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Title page 1

Contents 9

Executive Summary 4

1.0. Introduction 12

2.0. Bhutan Country Overview 13

National Context 13

Economic Context 15

Environmental Context 15

Social Context 17

3.0. Bhutan's Mining Sector 18

Key Mining Laws, Policies, and Institutions 26

Key Government Institutions 26

Mining Legislation 30

Environmental Laws 31

Tax Laws 32

International Commitments 33

4.0. Assessment: Bhutan and the MPF 35

Laws, Policies, and Institutions 35

Financial Benefits 44

Socio-Economic Benefits 51

Environmental Management 54

Post-Mining Transition 58

5.0. Conclusions 61

6.0. Recommendations 63

Recommendation 1: Laws, Policies, and Institutions 63

Recommendation 2: Post-Mining Transition 64

Recommendation 3: Socio-Economic Benefits 65

References 67

Appendix A. List of Laws and Policies Reviewed 70

Appendix B. List of Consulted Stakeholders 72

Tables 10

TABLE 1. Key strengths and gaps of each pillar of the MPF 5

TABLE 2. Mineral reserves/resources and locations in Bhutan 23

TABLE 3. International agreements and commitments relevant to the mining sector 34

TABLE 4. Bhutan Permitting and Clearance System 38

TABLE 5. Bhutan's fiscal regime 45

Figures 10

FIGURE 1. Administrative map of Bhutan 13

FIGURE 2. Protected areas of Bhutan 16

FIGURE 3. Geological map of Bhutan 18

FIGURE 4. Dolomite production (export and domestic consumption data in tonnes) 20

FIGURE 5. Institutional structure and related regulations for the mining sector 29