ADB lends $18 mln to Nepal for agri development

Singapore, Nov 24 (UNI) An 18 million dollar grant from the Asian Development Bank (ADB) will help commercialise agriculture in Nepal's eastern development region to expand economic opportunities for the rural poor.

This will bring together key stakeholders -- farmers, traders and processors -- to work together towards improving the efficiency of production, marketing and processing of high-value crops such as vegetables, fruits, tea and spices.

The project's total cost is estimated at 24.1 million dollar, with ADB financing upto 18 million dollars.

''It will help these districts build on existing strengths by helping the farmers to become more involved in commercial agriculture and helping processors and traders to improve their links to farmers and small entrepreneurs,'' said Jiangfeng Zhang, an ADB Project Economist.

''In doing so, the project will accelerate the process of agricultural commercialisation in the region and consequently, reduce poverty.'' He said the Government will contribute 8,00,000 dollars, Commercial Agriculture Alliance (CAA) members 4 million dollars while the balance will come from district development committees and the farmer communities.

The Ministry of Agriculture and Cooperatives in Nepal is the executing agency for the project, which is due for completion in December 2012.

The project will be carried out in 11 districts -- Dhankuta, Ilam, Panchtar, Terhathum, Udayapur, Jhapa, Morang, Saptari, Siraha, Sunsari and Taplejung -- which have favorable climates for agriculture, an existing entrepreneurial base, successful cases of commercial agriculture, and proximity to domestic and neighboring country markets.

He added that those value crops, with growing market demand and higher levels of return per hectare, can help improve incomes for small landholders who are producing cereals with relatively low returns.

Marketing of high-value crops, however, is constrained by weak links to markets, poor market infrastructure, and limited knowledge on part of the farmers, he said.

The project will help subsistence and semi-commercial farmers adopt high value crops to improve returns and to become more knowledgeable and capable in participating in commercial activities.

The commercial ones will be trained on social issues, gender concerns and environmental responsibility. The landless will be assisted through training to become employed in agriculture-related activities.

The project will promote the socially-inclusive participation of all stakeholders, including the poor, disadvantaged, and women in commercial agriculture, and help them receive fair benefits from such participation and in turn contribute to restoring peace and stability in the region.

A commercial agriculture fund will be established to provide a facility for the community to make investments in local market infrastructure, such as collection centers, small markets, storage centers and farm-to-market road improvements.

Commercial Agriculture Alliance (CAA), a non-profit company, has been established to manage the fund.

The fund will also support non-infrastructure investments that can add value to the agriculture products, such as pest management techniques, promotion of improved cultivation practices, greenhouse equipment and laboratory equipment for product testing and quality control.

Promotional activities like trade fairs will also be supported.

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