PUBLIC-PRIVATE-PARTERSHIP FOR SUSTAINABLE AGRICULTURAL DEVELOPMENT in Nepal

1. PUBLIC-PRIVATE-PARTERSHIP FOR SUSTAINABLE
AGRICULTURAL DEVELOPMENT IN NEPAL
GOVERNMENT OF NEPAL
MINISTRY OF AGRICULTURAL DEVELOPMENT

2. Presentation Outlines
 Agriculture Scenario in Nepal
 Government Programme and Policies on Agriculture
 Public Private Partnership for Agriculture Development
 Some Agricultural Development Program that have PPP Components
 Potential Areas for PPP in Agriculture
 Problems of PPP Approach for Effective Implementation in Nepal
 Provision in ADS (the main policy document 2015-2035) for Small Farmers
 Activities Included in ADS on Improved Resilience of Farmers to Climate
Change, Disasters, Price Volatility, and Other Shocks
 Contract Farming Practices
 Agricultural Value Chains (AVCs)
 Acts Related to Agriculture
 Agriculture Subsidy Provision
 Pro-poor Policy Should Include
 Glimpses of Nepalese Agriculture

3. Agriculture Scenario in Nepal
Sustainable agricultural growth is crucial to ensure food and
nutrition security in a country like Nepal
Agriculture still contributes about one-third to the country’s
GDP and provides direct livelihood to two-third of its
population
The Government of Nepal recognizes the importance of
agriculture in the Agriculture Perspective Plan, the Nepal
Agriculture Policy, and the Three-Year Interim Plan
However, the agriculture sector faces several challenges in
Nepal which includes low productivity, high instability, shocks
due to climate change, lack of adequate infrastructure and
insufficient investment

4. Agriculture Scenario in Nepal Contd…..
Figure 1. Composition of AGDP
Contribution of Different Sub-sector to AGDP

5. Agriculture Scenario in Nepal Contd…..
Total edible cereal production and requirement in different years
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6. Agriculture Scenario in Nepal Contd…..

7. Agriculture Scenario in Nepal Contd…..
 The

8. Government Programme and Policies on Agriculture
 The Periodic planning for development including agriculture
was first started from 1956
government has made increasing efforts, especially in the past
decade, to adopt policies appropriate to addressing food
insecurity problems, particularly through the Agricultural
Perspective Plan (APP) (1995-2015), National Agricultural
Policy 2004 and Agriculture Development Strategy (ADS)
2015-2035 and Different periodic plans
The National Agricultural Policy (2004) includes various
provisions for marginalized and vulnerable groups having less
than half a hectare of land to improve food security

9. Government Programme and Policies on Agriculture
It has also mentioned to create food storage provisions, a
mobilization network on a local participatory basis and to
develop food and nutrition safety nets for poor farmers
Nepal offers tremendous opportunities and has great
potential for agriculture. It has agro-ecological variations
that allow it to growing up to three crops per year, bio-
diversity, ample water resources, and market opportunities

10. Public Private Partnership for Agriculture Development
Government of Nepal (GoN) has recognized Public Private
Partnership(PPP) as an important approach for development
Local Self Governance Act 1999, Agriculture Policy 2004,
Agro-Business Promotion Policy 2006 and ADS 2015 highlight
diversification, service delivery and private sector involvement
to transform from subsistence to commercial agriculture
The successful areas of public private partnership are in services
delivery, and in infrastructure for post-harvest, marketing and
processing have been successful, and could be replicated with
further investment

11. Some Agricultural Development Program that have PPP
Components
One village one product (OVOP) and One District One Product
Program
Commercial Agriculture Alliance formed for Commercial
Agriculture Development Project (CADP)
Project for Agricultural Commercialization and Trade (PACT)
Raising Income of Small and Medium Farmers Project ,
(RISMFP), High Value Agriculture Project (HVAP) includes
private sector, especially the Federation of NepalesChamber of
Commerce and Industries (FNCCI)
Market Management Committees
Micro-irrigation construction by WUG
FUG that have preserved and protected the local forests
throughout the country could also be cited as a general example
of the PPP.

12. Potential Areas for PPP in Agriculture
Agriculture Education
Agricultural Extension Services
Agricultural Research
Seed Production
Fertilizer Production
Establishing Agro-export processing zone
Quality testing and certification - Lab for TBT & SPS
Adoption of good agriculture practice
Export promotion
Food security

13. Problems of PPP Approach
At local level, though the Local Self-Governance Act 2055
(1999) (LSGA) has taken the policy of promoting the private
sector in sustainable service delivery, it is silent regarding the
operation of PPP projects and PPP procurement
Notwithstanding a decade of experience in the area of PPP,
Nepal’s approach to it has had limited success
While there may be a number of reasons for this, such as the
protracted political transition and ensuing economic instability
and social transformation, a major reason is the lack of an
authentic document containing clear-cut vision and a road map
of future actions on GoN’s part for systematic uptake of PPP in
Nepal
The private sector has also pointed to the lack of clear policy
guidelines on PPP by the government

14. Provision in ADS (the main policy document 2015-2035) for
Small Farmers
The ADS activities will have impact on three groups of farmers
(commercial, subsistence and landless)
The direct effect is very strong in the case of the ADS measures
related to gender, social, and geographical inclusion; land (eg
addressing the issues of tenancy, land leasing, cooperative
farming, reversing the trend towards degraded land); access to
quality and timely inputs (eg vouchers targeted to subsistence
farmers, improved resilience); and access to microfinance and
agricultural insurance
 Landless or near landless will benefit from the ADS measures
related to targeted food and nutrition programs; gender and
social/geographic inclusion; access to forestry products; and
growth of small and medium enterprises.

15. Activities Included in ADS on Improved Resilience of Farmers to
Climate Change, Disasters, Price Volatility, and Other Shocks
Conduct research on stress tolerant varieties and breeds
Establish an early warning system
Establish climate information and weather indexation systems
Promote agricultural insurance
Improve capacity of extension staff and farmers in climate smart
agricultural practices through training, FFS, and demonstrations.
Strengthen the food reserve system
Establish a fund for preparedness and response

16. Contract Farming Practices
 Contract farming so far has not been a common phenomenon in
Nepalese agriculture. However, it has been practiced in some
cases especially in seed production and procurement in Nepal
though the experience is not that encouraging in absence of any
regulatory mechanism both in terms of the quantity and the
quality aspects of seed production
Contracts Act (2000) has been working for contract farming,
however, need of Contract Farming Act is being considered
address some of the land use practices prevalent in the rural
sector
For this Government of Nepal has prepared a final draft of new
Agribusiness Promotion Act-2015, which includes a legal
framework for contract farming

17. Agricultural Value Chains (AVCs)
Agricultural Value Chains (AVCs) have become very important
in determining countries’ trade competitiveness in a globalized
world
ADS clearly mentions to enhance the development of the value
chain through production, marketing and policy/institutional
support and
Promote the development of a suite of products for market
information and market intelligence using ICT
The ADS has provisioned farmers’ participation in different
institutional mechanisms to ensure their functional involvement
in center and local level

18. Acts Related to Agriculture contd……
Critical land issues such as tenancy, fragmentation, degradation,
land use planning have been addressed by ADS
Land Act 1964 has clearly mentioned about the equitable
distribution of the cultivable land and by making easily
accessible the necessary know-how and resources on agriculture
and to keep up the convenience and economic interests of the
general public by providing encouragement to make maximum
increase in agricultural production.
Consumer Protection Act 1997and the Essential Commodities
Act 1961 have provision for protecting consumers from
irregularities concerning the quality, quantity and prices of food
(food safety).

19. Acts Related to Agriculture contd……
 Government has formulated and adopted Natural Calamity
(Relief) Act 1982 focusing to relief
Food Act, 2023 having provisions for the determination of
quality on food items
Patent , design & Trade mark Act, 2022

20. Agriculture Subsidy Provision
Government has subsidization as a strategy to address issues
including: (i) supply of fertilizer; (ii) technology, seeds,
irrigation; (iii) transport to remote areas
Subsidies are ingrained in the being of the average Nepali
farmer and so is the case with Customs Duties and Excise Duties
There is no tax on income from agriculture. In addition, a
number of agricultural commodities are exempted from VAT a
Special programme on farming and agri-enterprise
development for poor and disadvantage group including
Kamaiya, women , Dalit and Raute and Mukta Kamaiya
cash and kind subsidies provided
Government provides 75 % subsidy on agricultural insurance
premium paid by farmers

21. 21
Subsidy on chemical fertilizer, organic industries, and
seeds effectively implemented
Special provisions on import custom duties on agri-
equipments being provided
Government support for establishing cold stores through
cooperative provided
Credit subsidy on tea, coffee, ornamental flower and
cardamom
Agriculture Subsidy Provision

22. Pro-poor Policy Should Include
Smallholder farmers can do farming in their own land if credit
facilities, inputs and technology are provided. But it will not be
sufficient for landless. Due to which provision of contract
farming, land leasing, value chain development and inclusion of
private sector for service delivery and infrastructure
development is important for them

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