Inflation In Bhutan Essay

Retails in Bhutan which has become modern can be seen from the fact that there are many shops that sell food items, non-food items, alcoholic items, and clothing are increasing day by day, and as a result a great demand for product is being created. If such an increase in demand can’t be met by an increase in production, prices begin to rise, which is generally termed as inflation. The high and volatile inflation can be damaging to both individual businesses and consumers and also to the economy as a whole.

In Bhutan, inflation has been on consistent rise since many years back. Previous studies narrate imported inflation, rise in the fuel price, increasing demand, rise in income level of the Bhutanese population among others as the prime determinants of inflation. The first factor, imported inflation although not relevant to many other countries, it is one of the prominent factors affecting inflation in Bhutan. This is because of the fact that Bhutan shares a common currency area with India, Bhutanese currency (Ngultrum) being pegged to Indian Rupee.

The biggest problem that has upset each and every retailer not only of Chukha dzongkhag but also retailers of a whole country is inflation. Inflation provides an easy excuse for even the smallest retailers to try and raise prices and hurts the buying power of the consumers. Here the rising price means we have to pay more for the same goods and services.

The major groups of product that our group did take are the food and beverages and Non-food items and Services. The markets targeted by our group are Tshimasham, Gedu and Phuentsholing were there is more number of retailers.

Inflation has another bad side-effect, once people start to expect inflation, they will spend now rather than...

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...e encouraged voluntary participation from the public and hence, no coercion was practiced.

c. Confidentiality of their information was ensured and this was made clear to them before their involvement in the study.

d. The participants are also well informed about the nature and purpose of the research.

1.6: Limitation of the study:-

This study is not without any problem however. Our study is constrained by the following problems.

 Time and cost constraint.

 The findings of this research are based on survey conducted only in Chukha Dzongkhag and it may not be applicable for other Dzongkhags of Bhutan.

 The literature on the matter is very limited.

 Because of time which was very limited we could only interview 50 retailers from the three locations. This might be very small but they are representative of the general business owners of the region and the country.