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Finance

Private equity comes to Bhutan

Foreign investors see opportunity in the kingdom's cash-strapped companies

Bhutan’s economy is among Asia’s fastest growing, but private companies like Gagyel Lhundrup Weaving Centre lack sufficient access to capital. (Courtesy MyBhutan.com)

HONG KONG Bhutan is one of the fastest-growing economies in Asia, but the Himalayan kingdom has a fundamental problem: Its private sector is relatively underdeveloped and starved for capital.

The Asian Development Bank projects gross domestic product growth of 8% for the fiscal year ending in June, but the expansion is being driven by investment in hydropower construction, largely financed by the Indian government. Meanwhile, farming and the public sector together account for three-quarters of employment in Bhutan due to "the lack of dynamism in the private sector," according to a recent World Bank report.

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