The University of Reading International and Rural Development Department PhD Thesis Forest Policy and Income Opportunities from NTFP Commercialisation in Bhutan PHUNTSHO NAMGYEL Submitted in fulfilment of the requirements for the Degree of Doctor of Philosophy MAY 2005 Declaration I confirm that this is my own work and the use of all materials from other sources has been properly and fully acknowledged. …………..……………………… Phuntsho Namgyel May 2005 DEDICATION TO THE KING, COUNTRY AND PEOPLE OF BHUTAN Acknowledgement Studying for a PhD is a demanding enterprise of time, funding and emotion. I am therefore indebted to a large number of people and agencies. Firstly, I am most grateful to the Royal Government of Bhutan for granting me a long leave of absence from work. In the Ministry of Agriculture where I work, I am most thankful to Lyonpo (Dr.) Kinzang Dorji, former Minister; Dasho Sangay Thinley, Secretary; and Dr. Pema Choephyel, Director. I also remain most thankful to Lyonpo Sangay Ngedup, Minister for his good wishes and personal interest in the research topic. With the war cry of ‘Walking the Extra Mile’, the Minister is all out to bring about a major transformation in rural life in the country. I look forward to being a part of the exciting time ahead in rural development in Bhutan. I have also received much support from Lyonpo (Dr.) Jigme Singay, Minister for Health, when the Minister was then Secretary, Royal Civil Service Commission. His Lordship Chief Justice Lyonpo Sonam Tobgye has been a source of great inspiration, support and information. I remain much indebted to the two Lyonpos. Doing a PhD is a major investment. I am most thankful to the SDC/Helvetas for financial support for the first year of the study, and the IDRC for the second part. In particular I am grateful to Mr. Hansruedi Stierlin and Dr. John Graham. I also remain grateful to the Bhutan Trust Fund for Environmental Conservation, in particular Mr. Tobgay Sonam for the small research grant which facilitated the fieldwork for Cordyceps. For the fieldwork in the country, I am thankful to Dr. Lungten Norbu, RNR-RC Yusipang for staff and transport support. I am also thankful to research colleagues who joined me in the fieldwork, in particular Mr. Tshitila (RNR-RC Yusipang), Mr. Dawa Penjor (National Mushroom Centre) and Tshering Phuntsho (Zhemgang Dzongkhag). I also owe much to the people of Soe, Lingshi, Laya, Genekha and Nangkhor geogs for their most kind cooperation and time. I hope the research brings about a positive policy impact in their NTFP extraction and trading. i Here at the IRDD, I am most grateful to Patricia Goldey, my academic supervisor for her patience, advice and guidance in the research. We enjoyed a great supervisor-student relationship. I could approach her as and when I needed to contact her. I have through her also enjoyed warm friendship with David Goldey. My sincere gratitude and acknowledgement is also due to Dr. Howard Jones who was my internal assessor in the transfer interview. I have benefited much from his valuable comments. I also take this opportunity to express my gratitude to all academic and support staff at IRDD for the pleasant and friendly working environment. It is always a pleasure to walk in the corridor of the IRDD to be greeted by smiles and warm greetings. Time is a premium for a research student. I am most grateful to Kaspar Schmidt, Badri Prasad Bastakoti, Charles Murekezi and Paul Chatfield for their valuable feedback on the draft thesis. I was fortunate to be visited in April 2005 by Dr. Pema Gyamtsho, ICIMOD, and I thank him immensely for his valuable comments. I have enjoyed a wonderful time at the University. I owe this enjoyment to a great number of friends. First, I am thankful to my Bhutanese friends, in particular Lham Nidup, BN Bhattarai, Tsheten Dorji, Phuntsho Gyeltshen, Rekha Chettri, Manjusha Rai, Lhap Dorji, Wangda Dukpa, Sangay Wangdi, Choki Dorji and Naomi Feinstein. I am also much thankful to my international friends, in particular Kaspar, Badri, Miho Ota, Lisa Hauck, Abhay Nath, Kennedy Lweya, Naya Sharma, Sitaram, Cherish Ocampo, Dan Condor, Alejandra O. Mendez, and Christopher Vaughan. Doing a PhD is also an emotionally draining long journey. I have sustained and survived it in good health and spirit. I owe this immensely to the love and affection of my wife Kinley Yangzom, and my children Tenzin Phuntsho, Pem Dechen and Sonam Chuki. I also owe to my parents Gaytay Phueli and Leki Wangmo, and my brothers Sonam Wangdi, Gaylong Sonam Tshering and Tshering Wangchuk. By no means least, I equally owe to my mother-in-law Dorjimo, and my many nephews and nieces. ii Table of Contents Acknowledgement…………………………………………………………………………i List of Tables…………………………………………………………………………….vii List of Figures…………………………………………………………………………...viii Boxes……………………………………………………………………………………...ix List of Pictures……………………………………………………………………………ix Abbreviations………………………………………………………………………….......x Glossary of Bhutanese Terms…………………………………………………………….xi Abstract…………………………………………………………………………………..xii CHAPTER 1: INTRODUCTION ............................................................................................................ 1 1.1 NTFP: AN ISSUE OF POLICY NEGLECT IN DEVELOPING COUNTRIES AND BHUTAN...................... 1 1.2 RESEARCH AIM, OBJECTIVES, QUESTIONS AND PROPOSITIONS.................................................... 4 1.2.1 Research Aim.......................................................................................................................... 4 1.2.2 Research Objectives ............................................................................................................... 5 1.2.3 Research Questions ................................................................................................................ 5 1.2.4 Study Propositions.................................................................................................................. 6 1.3 CONCEPTUAL FRAMEWORK ......................................................................................................... 7 1.4 EPISTEMOLOGY AND MOTIVATION FOR THE STUDY................................................................... 11 1.5 THESIS OUTLINE ........................................................................................................................ 12 CHAPTER 2: BHUTAN BACKGROUND .......................................................................................... 15 2.1 AREA, POSITION AND CLIMATE.................................................................................................. 15 2.2 HISTORY, CULTURE AND SOCIETY ............................................................................................. 18 2.3 POLITICAL SYSTEM .................................................................................................................... 20 2.4 GROSS NATIONAL HAPPINESS – BHUTAN’S DEVELOPMENT PHILOSOPHY.................................. 22 2.5 FOREST SECTOR ......................................................................................................................... 23 2.5.1 Forest Ownership and Organisation .................................................................................... 26 2.5.2 Timber Stock and Production ............................................................................................... 28 2.6 THE NATIONAL ECONOMY ......................................................................................................... 29 2.6.1 Balance of Trade .................................................................................................................. 30 2.7 THE RURAL ECONOMY............................................................................................................... 31 2.7.1 Market Integration................................................................................................................ 33 2.8 DEVELOPMENT CHALLENGES FOR BHUTAN ............................................................................... 33 CHAPTER 3:LITERATURE REVIEW................................................................................................... 35 3.1 HISTORY OF STATE FORESTRY ................................................................................................... 35 3.1.1 Forestry in Medieval Europe and Origin of Scientific Forestry........................................... 36 3.1.2 Colonial and Post-Colonial Forestry ................................................................................... 38 3.2 DECENTRALISATION AND DEVOLUTION IN FORESTRY ............................................................... 40 3.2.1 Social / Community Forestry................................................................................................ 41 3.3 NTFP: WHY THE SUDDEN INTERNATIONAL INTEREST? .............................................................. 43 3.4 NTFP DEFINITION...................................................................................................................... 44 3.5 SIGNIFICANCE OF NTFP AT LOCAL AND NATIONAL LEVEL ....................................................... 46 3.6 DEVELOPED ECONOMIES AND NTFP.......................................................................................... 48 3.7 NTFP COMMERCIALISATION...................................................................................................... 50 3.7.1 Challenges to NTFP Commercialisation for rural development .......................................... 51 3.8 FOREST POLICY AND NTFP.......................................................................................................