I NTERNATIONAL T ELECOMMUNICATION
Telecommunication Development Bureau
Date : 11-15 August 2003
Partnership Round Table for Least Developed
Coventry, United Kingdom, 11-15 August 2003
Project Proposal for Building ICT
Infrastructures for Rural
Communities in Bhutan
23 May 2003
Bhutan Telecommunications Authority
Ministry of Communications
Royal Government of Bhutan
Table of Contents
1. Country background ...................................................................................................... 4
2. Present information and communications technology (ICT) scenario ............... 5
3. Previous projects and existing research results ....................................................... 6
4. Project background ........................................................................................................ 6
5. Project objectives............................................................................................................... 8
6. Expected outcomes ......................................................................................................... 9
7. Project beneficiaries ....................................................................................................... 9
8. Technology choice ......................................................................................................... 10
9. Project partners and their work scope..................................................................... 11
10. Project implementation strategy ............................................................................... 12
11. Local partner obligations and commitment............................................................ 15
12. Project budget and financing ..................................................................................... 16
13. Project management structure .................................................................................. 18
14. Project sustainability .................................................................................................... 19
15. Economic analysis ......................................................................................................... 19
16. Implementation plan .................................................................................................... 20
16. Environmental impact assessment ............................................................................ 20
17. Monitoring and evaluation ......................................................................................... 21
Annex 1: Existing Telecommunications Network - Bhutan Telecom ...................25
Annex 2: Kanglung IP Network Schematic .........................................................27
Annex 3: Trongsa IP Network Schematic ...........................................................30
Annex 4: Damphu IP Network covering Sarpang Dzongkhag ............................33
Annex 5: Samtse IP Network Schematic .............................................................35
Annex 6: Samdrup Jongkhar IP Network Schematic...........................................39
Annex 7: Proposed project sites ........................................................................43
1. Country background
The Kingdom of Bhutan lies in South Asia, in the Eastern Himalayas. It is landlocked, between
the Tibetan Autonomous Region of China to the north and India to the east, south and west, with
a total surface area of 46,500 square kilometers and a population of about 700,000. The country
is almost entirely mountainous, with land rising from about 160 meters above sea level in the
south to the high Himalayas in the north that rise to over 7,500 meters. Administratively, Bhutan
is divided into 20 Dzongkhags (or districts) which are further sub-divided into 201 geogs1.
Bhutan has only recently ended its self imposed isolation and joined the
international community. The process of planned modern development began
with the First Five Year Plan (1961-1966). As it has gradually joined the
international community, Bhutan has adopted a unique approach to
development: Gross National Happiness (GNH). Articulated by the fourth
and present King Jigme Singye Wangchuck in the 1970s to underline that
development has more dimensions than just those associated with Gross
Domestic Product (GDP), GNH has served to direct change within Bhutan.
Development is understood as a process that seeks to maximize happiness
rather than economic growth. The five themes of GNH are human
development, good governance, balanced and equitable development,
preservation of culture and heritage, and environmental conservation.
Into the second year of the Ninth Five Year Plan, 9FYP (2002 – 2007) now, the basic
infrastructures in the country have been considerably improved. This in turn has allowed new
economic activities such as the sale of hydroelectric power and construction to be developed.
Indeed, the electricity sector provided almost 45% of the national revenue in 2000 – 2001 and is
increasingly pivotal to the country’s economic development. At the same time, the government
has sought to improve the basic level of education and the efficacy of government. In late 1999,
the government released a report aimed at facilitating good governance through enhancing
efficiency, transparency and accountability that has subsequently been acted upon.
A vivid demonstration of Bhutan's willingness to embrace the international community can be
found in its membership of international organizations such as the International
Telecommunications Union (ITU). Through these organizations, Bhutan has begun to
internationalize its decision-making processes. Bhutan has also applied to join the World Trade
Organization (WTO), with a working party being established in 1999 to examine its application.2
A geog is the smallest administrative block comprising a number of villages. A village population in Bhutan
normally ranges from 50 to 300.
Bhutan applied to join the WTO on the 17th September 1999, with a working party being established in October
1999. However, it was not until February 2003 that the Director-General of the WTO welcomed the commencement
of 'serious work' on its accession process with the delivery of the Memorandum on the Foreign Trade Regime to the
WTO (WTO, 2003).
2. Present information and communications technology (ICT) scenario
Telecommunications (telecom) and information technology (IT) in Bhutan is also a fairly recent
affair. The Royal Government of Bhutan (RGoB) initiated the first telecom network in 1963,
which then consisted of three separate analogue networks. Modern telecom development
process began only in the late 1980s.
Internet services were introduced in 1999 with the establishment of DrukNet, the first and only
Internet Service Provider (ISP) so far. The 77th Session of the National Assembly passed the
Bhutan Telecommunications Act 1999. Division of Information Technology (DIT) was created to
promote IT development and Bhutan Telecom Authority (BTA) to regulate the telecom sector, in
January 2000. The erstwhile Department of Telecom (DoT) was transformed into a wholly
government owned corporation, Bhutan Telecom (BT), in July 2000.
An accelerated development of the telecom sector in Bhutan started with the formulation of the
National Telecommunications Master Plan (the Master Plan) in 1989 and subsequent funding by
Japanese grant aid from 1991 onwards. This Master Plan was implemented in four phases over
a 7-year period. Bhutan now has a reliable digital telecom network interconnecting all the 20
Dzongkhag headquarters and major commercial centers. The main transmission backbone
network consists of 34Mbps digital microwave routes connected to digital switching systems at
some of the populous Dzongkhag centers and other urban areas while the lesser traffic spur
routes consists of 8Mbps microwave radios connected to Remote Line Units. Digital Radio
Multiple Access Subscriber System (DRMASS) was also deployed to extend services to some of
the Dzongkhags and few other urban centers with smaller capacity requirements. Annex 1
depicts the existing national telecommunications network.
Present connectivity is limited to the Dzongkhag headquarters, satellite towns, places with close
proximity to roads and very few rural areas. Rural services have been extended using Very High
Frequency (VHF) and Very Small Aperture Terminals (VSAT) technologies. High Frequency
(HF) wireless communications still play a vital role in serving isolated remote areas. Teledensity
is about 3% but actual penetration in the rural areas is less than 0.01%. In the fourth year of its
establishment, DrukNet has about 1,750 customers nationwide. There are at present about
7,000 computers in the country, most of which are concentrated in the capital and other urban
centers. These give a clear indication of the Digital Divide that exists between the urban and
rural areas in Bhutan.
BT has implemented a wireless Voice over Internet Protocol (VoIP) rural
access pilot project, in 2002, with some valuable assistance from the ITU. The
first phase of the project to introduce mobile cellular communications in the
country is well underway and should commence operations by end of 2003.
BT is also negotiating with the Danish Government for funds to implement the
Rural Telecommunications Master Plan (the Rural Plan). BTA is
coordinating, a capacity building programme for new technologies and
management, with the ITU, designed to train 20 BT middle and senior level
technical and management staff during the second half of 2003.
The Dzongkha3 Development Commission has developed the software needed to include
Bhutan’s national language directly into the Windows Operating System. Towards the end of
2003, users around the world will be able to use Dzongkha automatically in all Windows-based
programmes, without loading any plug-ins. This will make computers and information more
accessible to users who are Dzongkha literate, and help schools teach Bhutan’s national
Meanwhile, DIT is coordinating a UNDP-assisted project to formulate an ICT
Policy and an ICT Act for Bhutan. A “Bhutan E-Readiness Report” is being
prepared as a preliminary requirement of the project.
3. Previous projects and existing research results
BT had conducted numerous field surveys of various sites and feasibility studies across the
country prior to implementation of the Master Plan in 1998. These reports are available for
reference. BT has valuable data and information on several remote and rural sites identified in
the process of drawing up the Rural Plan in 2000. This Plan document, updated recently, is also
DIT has conducted a nationwide IT survey in March 2001. The findings of this survey are useful
and informative. A report to this effect is also available. DIT has successfully implemented a
wireless Local Area Network (LAN) system for the Ministry of Communications, Thimphu.
Experiences from and findings of this work can be used.
BTA has implemented a “computerization of schools” project during the first half of 2003.
Research results and valuable information can be extracted from this project experience.
Private ICT firms have the capability – manpower, technical and financial - to
undertake networking projects and assemble computers locally. A few of
these firms have successfully implemented fiber-optic networking projects in
the country. Some of these firms have the resources to train people in IT and
4. Project background
Bhutan as a landlocked country, far from regional markets, with no major industries, and few
export products, has everything going against it in a traditional economic model. It is further
away from opportunities, knowledge and information than many other countries. Thus, the need
for ICT is very large, as are the potential benefits.
BT has expanded the national network to provide services to some rural areas. However, as
about 80% of the people still live in rural and isolated areas, rural teledensity is less than 0.01%.
The very low teledensity in rural areas calls for the need to establish mechanisms to bridge the
gap between the rich and poor, the information 'haves' and 'have-nots', the urban and rural. The
Dzongkha is the national language of Bhutan.
objective of the telecom sector during the 9FYP is to provide 10 telephones for each of Bhutan's
201 geogs, to enhance communications, promote e-governance and accelerate private sector
participation. Facilitating access to and enabling use of ICT for rural communities would
underpin achieving these national goals. The need to establish reliable access infrastructures,
facilitate hardware and software availability, educate and encourage rural people to use ICT for
socio-economic development, and raise awareness among ICT users, is timely.
The Internet/World Wide Web allows access to countless resources, including community,
national, and world facts, reference materials, and information on any topic. Simply providing
access to ICT use isn’t enough. Experiences elsewhere show that technology must be
integrated with local activities if learning is to take place, meaning that users must make use of
technology’s powerful ability to gather data, expedite communication, and analyze information.
In Bhutan, there exists a unique environment that greatly improves the chances for development
of a knowledge-based society to succeed: widespread knowledge of English language; good
national telecommunications network; significant and relatively well-educated population; limited
previous computerization and networking, allowing the adoption of new and open standards;
manageable amount of data; and the Royal Government’s commitment to adopt ICT as a
development tool. This favorable environment sets Bhutan apart from other countries in the
region and therefore presents an opportunity for the development of ICT.
Donors have realized Bhutan’s potential in ICT, and several have already
supported a number of ICT initiatives. Others are keen to join, and help the
country in its quest to develop ICT and bridge the Digital Divide. Compared
to other countries in the region, they feel Bhutan stands a good chance to
achieve its goals of going “ICT-savvy”.
The main factor that has aggravated the Digital Divide in Bhutan is the huge amount of
capital investment required to extend ICT services into rural areas, at very low commercial
returns. The difficult geographical terrain and sparsely distributed population pose
additional hurdles. The lack of commercial power supply facilities, in rural and isolated
areas, escalates project costs, as solar power supply systems need to be deployed at repeater
and terminal sites.
The demand, however, for ICT services in the rural areas is ever increasing.
The new rural population realizes that the three basic infrastructures required
for balanced development are motor roads, electricity and ICT access. It is
thus likely that demand would far exceed the Rural Plan forecasts depending
on the number of villages under each geog.
The initial Rural Plan envisaged coverage of 90% of the rural villages. The plan proposed
deployment of DRMASS, as this technology was widely used in Bhutan then and BT employees
were familiar with its installation, operation and maintenance. However, this technology was
becoming obsolete and the manufacturer discontinued further production of such equipment. BT
therefore had to study the possibility of deploying various technologies for rural connectivity,
including the widely acclaimed and rapidly evolving wireless Internet Protocol (IP) technology,
which supports both voice and data.
BT has satisfactorily deployed VoIP over wireless technology in two
geographically distinct sites in Bhutan during 2002, as a pilot project. This
ICT infrastructures project utilizes the findings of the pilot project and will
complement the new Rural Plan through building ICT access infrastructures
to serve about 46,400 inhabitants in 29 rural communities geographically
located in 7 Dzongkhags.
5. Project objectives
This project is designed to connect 29 isolated rural communities to the
“global information infrastructure” through facilitating individual access and
establishing networked Community Access Points (CAPs) using low cost
wireless IP networking technology. These communities could not be
incorporated in the Rural Plan due to their difficult geographic conditions and
limitations of the technology that would be used for implementation of the
Rural Plan. Some of these sites are almost physically inaccessible.
With the proposed wireless IP network interconnected to the Public Switched
Telecommunication Network (PSTN), these rural communities can
communicate with the outside world. It is an initiative dedicated to closing the
Digital Divide gap, aimed at linking rural people to their families, relatives and
friends who live far apart in the country and abroad. It will lay the foundation
for an inclusive Information Society and will go a long way in complementing
the Rural Plan.
The specific objectives of the project are to:
• Promote ICT at the grassroots level.
• Improve access to ICT up to 9% of the total rural populations, of which penetration is
• Develop ICT applications through networked CAPs in rural areas: e.g.,
Promote e-learning and increase access to education facilities;
Increase access to information and knowledge;
Stimulate the development and growth of local businesses; and
Develop ICT skills among the local population.
• Give impetus to RGoB’s decentralization initiatives and rural development activities.
• Contribute towards progressive achievement of GNH.
• Foster partnerships among all stakeholders.
6. Expected outcomes
With the implementation and commissioning of this project, 29 isolated rural communities
with about 46,400 people would have access to ICT services. The priority policy of the
RGoB is to decentralize developmental activities to the grassroots. Hence, facilitating ICT
services would not only accelerate this noble objective but also foster information sharing
among all stakeholders and users.
The expected outcomes of the project are to:
• Establish wireless IP networks covering 29 rural communities.
• Establish a networked CAP in each of these communities.
• Provide low-cost ICT access to a rural population of about 46,400 inhabitants.
• Penetrate into rural areas not covered under the Rural Plan.
• Enhance literacy, in particular ICT literacy, in the country.
• Facilitate ICT user training, awareness and support.
In the Information Age, access to ICT is as vital as the basic human needs. The shared and
common use of the CAPs in these rural areas will ensure affordable and sustainable access to
ICT services. Furthermore, the availability of ICT facilities provides equal opportunities for both
genders to exploit the benefits of the digital age.
7. Project beneficiaries
The beneficiaries are the general public in the service coverage areas, including geog
employees, teachers and students, health workers, agriculture, animal husbandry and forestry
agents and local entrepreneurs. About 6,600 households, i.e. about 46,400 people, in 29 rural
communities located under 7 Dzongkhags will ultimately benefit from the project. This is about
7% of the total population, which is about 9% of the total rural populace.
Table 1 shows the beneficiary sites proposed to be covered under the project. Refer Annex 7
for geographical location of these sites on the country map.
Table 1. Beneficiary communities
Sl. Dzongkhag Number of households Total population
No Name of @ 7/household
1 Samtse Tendu 470 3290
Biru 142 994
Gumouney 401 2807
Bindu 85 595
Denchuka 193 1351
Dorokha 463 3241
Mayona 185 1295
Bara 474 3318
Sengdeng Included in Dorokha -
Jumsa Included in Tendu geog -
Lahereni 347 2429
Dumtoe 252 1764
2 Zhemgang Bjoka 153 1071
Pangkhar 203 1421
Ngangla 517 3619
Gongphu 50 350
3 Haa Sombekha 258 1806
4 Samdrup Jongkhar Samrang 41 287
Martsala 512 3584
Dalim 158 1106
Debarli Included in Martsala
5 Pema Gatshel Chongshing 123 861
6 Mongar Thangrong 280 1960
Ngatshang 268 1876
Chaskhar 401 2807
Yadi Included in Chaskhar
Sherimuhung 269 1883
7 Sarpang Deorali 249 1743
Nichula 124 868
Total 6,618 46,326
8. Technology choice
Facilitating ICT access to rural and remote areas is a challenging task. Choosing the right
technology is a much more difficult task. A feasible and future-safe technical solution must
emphasize scalability, cost-effectiveness and a choice of vendors offering compatible
equipment. Furthermore, the solution should provide adequate reliable connectivity capabilities
for both voice and data.
Rural Bhutan is characterized by settlements dispersed over wide areas across mountains and
narrow valleys. Thus, wireline telecom is not a feasible option. BT has successfully integrated
and tested multi-vendor IP (packet) radios on a pilot basis at two geographically distinct sites in
the country and found it feasible for satisfactory rural connectivity.
The IP over wireless LAN is a forward-looking technology and promises to be the most cost-
effective. This utilizes wireless LAN as the transport mechanism (using repeaters) to deliver
services. The low power requirements and falling costs of wireless LAN equipment make this
ideal for multiple repeaters. IP is run over this infrastructure to provide voice services to rural
and isolated areas.
IP over wireless infrastructure (also called Wi-Fi) for rural communications is being tested in
many parts of the world with the cooperation of the ITU. Advantages include:
• Global trend towards IP-based networks;
• Ability of the network to carry both voice and data effectively;
• Low power consumption of the wireless LAN equipment making them ideal for
• Faster rollout times;
• Lower maintenance costs;
• Greater network flexibility and scalability;
• Cost-effective for rural deployment;
• Wirelines extendable up to 7 km from the nearest wireless access point;
• Possibility of remote network management; and
• Power saving mode features.
9. Project partners and their work scope
Potential project partners include:
• Funding agency(ies) – the source(s) of funds to facilitate implementation of the
• International Telecommunication Union (ITU) – the international organization within
the United Nations System, which coordinates and facilitates governments and the
private sector for development of global telecom networks and services.
• Bhutan Telecommunications Authority (BTA) – the telecom regulatory body in
• Bhutan Telecom (BT) – the incumbent and only telecom operator and service provider
• Division of Information Technology (DIT) – the body responsible for promoting IT
development in Bhutan.
• Private ICT firms – the business community.
• Rural communities – the beneficiaries, comprised of the local population including
schools, geog-based governmental and other agents.
The scope of work of partners is as follows:
• Funding partner(s) will provide funds necessary to implement the project. Partner
strategic interest lies in the global initiative to bridge the Digital Divide and open up
digital opportunities. Linking rural communities to the Internet and each other is a
gracious step in this direction.
• ITU will coordinate and mobilize funds necessary for implementing the project. One of
the six programmes of the Istanbul Action Plan (IsAP), to be implemented by the
Telecommunication Development Bureau of the ITU, is the Special Programme for the
least developed countries (LDCs) “aimed at integrating LDCs into the world economy
through telecommunication development”. The IsAP is a comprehensive package that
will enable developing and least developed countries to promote the equitable and
sustainable deployment of affordable ICT networks and services.
• National coordination is in the capable hands of BTA. Recognizing that ICT is an
enabler of social growth and economic development, BTA's interests lie in achieving
local delivery of universal, affordable ICT access through creating an enabling
regulatory policy environment and stimulating investment in reliable ICT infrastructures.
• BT has experienced engineers and managers capable of choosing the appropriate
access technologies and establishing networked CAPs. As the incumbent and only
telecom operator in the country, BT is driven by both commercial interest and social
obligations. DrukNet under BT is the only ISP, as of date, operating throughout the
• DIT has the capacity to establish LANs (both wired and wireless), initiate and develop
content and applications, train and raise awareness among users.
• Bhutan's private ICT firms have undertaken several networking projects and have
successfully implemented them. They possess local computer assembling capabilities.
Most of these firms and their businesses are concentrated in the urban areas. This
project will let them learn, explore and draw best practices and configure business
models for sustainable investment in a setting relevant to rural and sub-urban Bhutan.
• Local people are keen to learn new things and use these for individual progress, social
growth, and economic development. Governmental organizations at the local level
must be encouraged to participate in ICT development programs in the context of their
job responsibilities. ICT literate locals must be encouraged to share their know-how
with their fellow villagers willing to learn and use ICT in their daily lives.
BTA is responsible for preparing the project document in close coordination with DIT and BT.
However, BTA will require assistance in preparing tender documents, drawing up technical
specifications and evaluating the tender proposals for the project (if applicable). This would
require hiring consultants. It may be necessary to hire experts in IP radio, switching, and power
plant system during the implementation of the project. Costs to cover these professional
services have been included in the overall project budget estimate. ITU will be responsible for
fielding two experts/consultants, one international and a local counterpart, to guide during project
initiation and through the installation and commissioning processes.
BT, BTA and DIT will be directly involved in the implementation of the
project. It is also in the interest of BT to train as many people during the
implementation process, as BT would be operating and maintaining the system
after commissioning and handing-taking over of the facilities. This would
offer good opportunity for project members to gain firsthand knowledge on
the system installation works, testing procedures, operation and maintenance.
The costs for on-the-field training will be borne by the local partners.
10. Project implementation strategy
The main objective of the project is to facilitate ICT access to rural areas. In doing so, the
strategy is to use the existing primary links, build new point-to-point backbone wireless
links and add-on wireless point-to-multipoint secondary infrastructures for ‘last-mile’
connectivity to homes and CAPs in rural communities.
The project budget is roughly estimated at US$ 4.139 Million. IP-PSTN
gateways would be installed at Kanglung, Trongsa, Damphu, Samtse and
Samdrup Jongkhar. Refer annexes 2, 3, 4, 5, and 6 for network schematics
corresponding to the five gateway locations. A CAP will be established at each
of the 29 selected sites. The CAP system requirement with associated costs is
shown in Table 2.
Table 2. Community Access Point (CAP) system requirements
Cost/unit Total cost Additional
(US$) (US$) Information
Access Point 1,500 1 1,500 With antenna
Switch 700 1 700 12-port
Gateway 400 1 400 Wireless IP to analog
Personal computer 1,000 5 5,000
IP and analog telephones 400 1 400 385 + 15
Printer (Basic Laser) 1,500 1 1,500
Solar power supply 7,500 1 7,500 Solar panels, charger,
batteries, Inverter, etc.
Figure 1 shows the generic schematic of a networked Community Access Point
Figure 1. Generic schematic of a networked Community Access Point (CAP)
Gateway Switch Access Point
Analog phone IP Phone
PC PC Laser printer
Figure 2 below depicts solar power supply system configuration. Each CAP site would need
about 10 solar panels (70W/17V), 5 batteries (150AH), a charger, and an inverter.
Figure 2. Solar power supply system configuration
Pr PC PC PC
The project will be implemented within a 2-year timeframe. The details of coverage areas
are indicated in Table 3 below.
Table 3. Project coverage areas
Sl. Gateway Location Geogs/Communities Covered Remarks
1 Kanglung Yadi, Chaskar, Ngatshang, Sherimuhung (4) See Annex 2
2 Trongsa Gongphu, Bjoka, Ngangla, Pangkhar (4) See Annex 3
3 Damphu Nichula, Deorali (2) See Annex 4
4 Samtse Gumouney, Biru, Lahereni, Tendu, Bindu, Bara, See Annex 5
Jumsa, Sombekha, Denchukha, Dorokha,
Sendeng, Mayona, Dumtoe (13)
5 Samdrup Chongshing, Thangrong, Dalim, Samrang, See Annex 6
Jongkhar Debarli, Martsala (6)
5 Gateways 29 Communities Total
11. Local partner obligations and commitment
Development and field training of human resource is a key factor in the
operation and maintenance of the rural ICT infrastructures during
installation and commissioning of the project. The local project team will be
comprised of 7 BT, 2 BTA and 2 DIT members. The team will provide
installation support activities, coordinate with local communities for
equipment accommodation, furniture and utilities (where available) and
participate in formal project evaluation exercises with the ITU.
BTA can assist the ITU in recruiting a local counterpart expert to guide
through and supervise the implementation of the project. Cost components
related to local transportation, on-the-field training, installation, site access,
etc. will be managed locally through coordination among the local partners
and target beneficiaries. See Table 4 for cost contribution details.
12. Project budget and financing
This project is designed to complement the implementation of the Rural
Telecom Master Plan during the ongoing 9FYP and covers 29 communities in
7 Dzongkhags. Financing is sought for this project to the tune of US$ 4.139
Million (equivalent to local Nu. 194.533 Million, US$ 1 = Nu. 47) 4. The
detailed project cost estimate for implementing the project is shown in Table
Table 4. Detailed cost estimate for implementation of the wireless IP network
No Item Description Rate Total Remarks
1 Network Equipment
IP Router 12000 8 96000
Ethernet Switch 4000 4 16000
IP-PSTN Gateway Platform/Application 40000 8 320000
Gate Keeper Platform and Application 20000 4 80000
Network Management Platform and
Application 25000 4 100000
CDR Data Collection Platform and
Application 80000 4 320000
Wireless Switch/Hub (802.11a/b/g
compatible) 1000 29 28000
Packet Radio (802.11a/b combo) 3000 72 216000
Antenna and Accessories 1000 72 72000
Terminal Gateway with FXS Interface (4
ports) 2000 29 58000
19-inch Rack and Accessories 3000 9 27000
2 Network Power Subsystem
2a Repeater Sites (-48 V DC)
Solar Panel 300 326 97800 Packet radio sites
Battery 150 AH 600 168 100800 located at the
Charger -48V 40Amps 800 21 16800 existing Microwave
repeater sites will
Cables and Accessories 1500 21 31500
Nu. is the abbreviation for Ngultrum, the Bhutanese currency. Nu. 1 = 100 Chhetrums (Ch.).
Antenna Pole and Mounting 150 21 3150 use the existing
Accessories power supply
Outdoor Weatherproof Enclosure 500 21 10500
2b Terminal Sites (12V DC)
Solar Panel 300 29 8700
Battery 60 AH 150 29 4350
Charger (12V 10 Amps) 25 29 725
Cables and Accessories 500 29 14500
Antenna Pole and Mounting
Accessories 150 29 4350
Outdoor Weatherproof Enclosure 500 29 14500
See Figure 1, Table
3 Community Access Point (CAP) 17000 29 493000 2
Total 1 2,134,675
4 International Freight & Insurance 320201 15% of Total 1
(CIF Phuentsholing, Bhutan)
5 Consultancy/Expertise (IP radios) 2 100000 1 international (6
months) and 1 local
6 Factory training 5000 12 60000 Training at supplier’s
/ manufacturer’s site
7 Field study visits 5000 12 60000 To sites where
technology has been
deployed for delivery
of both voice and
Total 2 (External component) 2,673,876
8 Installation costs 320201 15% of Total 1
9 Local transportation 100000 P/ling to Thimphu to
sites: To be borne by
BT and BTA.
10 On-the-field training 15000 12 180000 8 BT staff, 2 BTA
staff, and 2 DIT staff
for 18 months: To be
borne by BT, BTA
11 Training of trainers and end-users 1000 145 145000 Assuming 5 trainees
per site for 1 month.
DIT will be involved.
12 Antenna mounting mast and erection 300 40 12000 Couple of sites use
cost existing towers and
13 Earthing/grounding 2000 29 58000
14 Land acquisition 1665 40 66600
15 Fencing of repeater and terminal 1415 40 56600
16 Other local inputs (access road to 150000
repeater and terminal sites, site
clearance, CAP sites, equipment
accommodation, furniture, etc.)
Total 3 (Local component) 1,088,401
Total 4 3,762,277 Total 2 + Total 3
17 Contingency 376228 10% of Total 4
Grand Total 4,138,505
This budget would be utilized for building ICT infrastructures for 29 rural communities with a
population of about 46,400 people through facilitating individual connections and establishing
CAPs at each of these sites. The costing takes into account all costs associated with the project
including costs for network equipment, power subsystem, installation, international freight and
insurance, local contributions, training requirements and professional services. BTA will
coordinate local commitments and obligations. Local cost components are reflected in Table 4
above under serial numbers 8 through 16.
13. Project management structure
The project team will be comprised of 11 members, led by a Project Manager. Given BT’s
experiences with the VoIP pilot project and familiarity with IP radios, the Project Manager will be
recruited from within BT. He/she will work in close cooperation with the experts fielded by the
ITU. Other prominent project partners and stakeholders are BTA, DIT, private ICT firms and
rural communities. Each partner is a part and parcel of the project.
The project management structure is shown in Figure 3 below.
Figure 3. Project management structure
Local counterpart Project Manager International expert
4 (2 + 2)
Project Team (12) 7
BTA/DIT Bhutan Telecom
• Preparation of project document • Collaborate in project
• Mobilizing funds document preparation
• Tendering (if applicable) • Technical support through
• Procurement implementation
• Delivery • Operation & maintenance
• Training of trainers • Evaluation inputs
• Monitoring and evaluation • Future expansion
Private ICT firms:
• Equipment supply
• User training
furniture, etc. Telecommunicatio Ministry of Communications
• Other commitments n Union Royal Government of Bhutan
Note: Numerals denote project team manpower contributions.
14. Project sustainability
ICT business is very capital intensive and hence will require prudent planning to optimize on
investment and at the same time meet national objectives. This is especially the case for rural
Bhutan where sparsely distributed population and mountainous terrain make it extremely difficult
to provide ICT infrastructures. Rural ICT access, thus, does not present a commercially viable
business case but has proven to sustain through revenues generated from associated ICT
opportunities inherent in providing access.
Multipurpose access points could be established, additional connections can be provided at very
minimal or no cost to BT, e-learning and e-health facilities could be established, and e-business
opportunities could be explored into. Facilitating ICT infrastructures in rural and remote parts of
the country integrates the population and fosters multi-sector business partnerships and
ventures. ICT can be used as a tool to expose small-scale cottage industry products to an
In essence, ICT, as an industry and as a tool, has the potential to create immense digital
opportunities for village entrepreneurs, women and men, who at present are further away from
basic knowledge and information.
Given the commitment of the Royal Government to encouraging affordable access to ICT for all
Bhutanese, and in particular the enthusiasm shown by the rural populace, the sustainability of the
project is assured.
Communities can access the Internet via a negotiated monthly flat rate DrukNet dial-up
connection at the CAPs. Nominal fees can be charged to users to recover subscription cost,
monthly call charges and rental. These fees charged to users will also support costs for personnel,
paper and other consumables, making the project fully sustainable immediately upon
commissioning of the project.
Other resources in the local communities can lend assistance, and local businesses may
underwrite some of the operational costs.
15. Economic analysis
Social cost benefit analysis is a perfect necropsy where the identification and determination of
the best among project alternatives is made with reference to a country’s economic and social
priorities. It is a systematic procedure for comprehensive review of all costs, benefits and effects
of the project. It is therefore important to identify the major economic, environmental, social and
other factors that may be influenced, directly or indirectly, by a project. Telecommunications is
viewed as a catalyst to help enhance socio-economic development. Hence, rural
telecommunications is viewed from the social point of view rather than commercial returns.
The rollout of this rural ICT connectivity initiative will provide affordable access to data and voice
services. The social cost and benefit of the project is viewed by its influence on other
developmental activities in the rural areas and expected indirect socio-economic benefits.
16. Implementation plan
The importance of realizing the objectives of the 9FYP through implementation of the rural
telecommunications network has been time and again stressed and is a priority project. This
ICT infrastructure project will contribute, in whatever small and valuable ways, towards achieving
these national objectives.
In the event of a funding agency coming forward to finance this Digital Divide bridging ICT
initiative, a concrete implementation plan could be negotiated. The project will be implemented
within a 2-year period.
A tentative schedule of implementation of the project is shown in Table 5.
Table 5. Tentative implementation plan
Sl. Activities Tentative schedule
1 Submission of project proposal by RGoB/BTA Month 1
to the LDC roundtable meeting organized by
2 Final appraisal of project by ITU Month 2
3 Approval of the project by ITU Month 3
4 Tendering (if applicable), procurement, factory Month 4 – Month 6
training, field study visits
5 Installation of the project Month 7 – Month 20
6 Testing and commissioning of the project Month 21
7 Training of trainers/users Month 22
8 Monitoring and evaluation report Month 24 (Month 30, Month 36)
16. Environmental impact assessment
The ICT infrastructures project will have very little or no impact on the
environment in Bhutan.
Rollout of ICT infrastructures to rural areas will have slight environmental
and visual impact in areas currently not served by BT. Repeaters and
terminal sites will need to be installed on hilltops and protruding positions,
which will give a maximum area of coverage. This will require site clearance
by way of minimal flattening of hilltops (in some areas) and felling of few
trees. Likewise, the secondary networks connecting terminal sites with the
primary backbone network will make use of ‘thin’ radio links consisting of one
or more hops. The masts of these links will also be visible. Fencing will
protect repeaters and terminal sites physically.
It may be necessary to erect poles and pull wires to individual customers to provide the ‘last mile’
connectivity but in any case the visible installations of the access network will appear to be
vanishing in the dramatic landscape of rural Bhutan.
Environmental impact assessment requirements, if any, would be locally coordinated with the
National Environment Commission and other concerned parties.
17. Monitoring and evaluation
BTA, as the coordinating national agent, will closely monitor the
implementation of the project. On completion and commissioning of the
project, BTA will submit an evaluation report to the ITU and other project
stakeholders after thorough study, observation and assessment of the project
outcomes. Local and national partners will participate, with the ITU and
project experts, with inputs for the project evaluation report.
SES & VSAT DAMA Annex 1: Existing Telecommunications Network -
M/W Active repeater Bhutan Telecom
M/W Passive repeater
Planned routes DRMASS Gasa
Dobchu Punakha Yotula Namnapan Ngalamdun
Thimphu Dochula Lobesa Chummey
Limukha Pelela P Trongsa Tangsbi Tshenkharl
Damthang Yusipan Wangdue
Semtoka Tsemila Terang Thrumsingla Yangmeer Rangjung
Khasadrapchu Rurichu Tandi P Korila Trashigang Samchellin
Chelel J.J Peak Baling
Yongkol Kanglung Rangshikh
Panjurmani Mongar Yongphula
Chapcha Zhemgang Khaling
Chimakoti Samkhar Yongla
Gedu Dagana Setipokhari Tamal gompa
Padechu Damphu Pemagatsh
Saure Pepch Namchella Surey
Gomtu Tala Sarpang Deothan
Phuentsholing Pasakha Gelephu
Source: Bhutan Telecom (2003)
Annex 1: Existing Telecommunications Network - Bhutan Telecom
Annex 2: Kanglung IP Network Schematic
Annex 3: Trongsa IP Network Schematic
Annex 4: Damphu IP Network covering Sarpang Dzongkhag
Annex 5: Samtse IP Network Schematic
Annex 6: Samdrup Jongkhar IP Network Schematic
Annex 7: Proposed project sites
T Gongphu Chongshing
Ghumo Denchukha Martsala Debarli