ADB grant to spur agribusiness, higher incomes in hilly districts

The Asian Development Bank (ADB) is to help thousands of households in remote mountainous areas of Nepal gain more income from the production and sale of valuable agricultural produce.

A grant of $20 million from ADB’s concessional Asian Development Fund for the High Mountain Agribusiness and Livelihood Improvement Project will be provided to small farmers and rural enterprises to help them increase the value and salability of their goods, said the Manila-based agency.

The initiative is expected to generate new jobs for an estimated 7,500 people, directly benefiting about 5,000 households in 10 districts across four development regions.

"The goal is to make mountain agribusinesses more commercially viable and to take advantage of improving rural infrastructure, as well as rising private sector interest in their goods," said Hans Woldring, agriculture and natural resources economist with the ADB.

Agriculture employs about two-thirds of Nepal’s population and contributes over a third of the country’s gross domestic product (GDP). Despite the sector’s importance, growth has been constrained by farmers’ limited access to services, marketing, and employment opportunities.

The country is not only a net food importer, but it is also witnessing a rising private sector demand for many mountain products such as wool, seeds, off-season vegetables and medicinal plant products.

By supporting activities such as improved processing, packaging, distribution and marketing, the project will help agribusinesses add quality and value to their goods, increase investment opportunities and links with the private sector, and boost off-farm employment.

"It will be especially beneficial for women as many farm households are headed by them, and they are heavily involved in small rural enterprises engaged in producing high-value items from local materials," the bank added.

The government will provide over $4.5 million equivalent, while beneficiaries sponsoring private sector investments in the industry will extend over $5.7 million equivalent, for a total project cost of over $30.2 million. The Ministry of Agriculture and Cooperatives is the executing agency for the project which has an expected completion date of April 2017.

Zhao leaves Kathmanu

KATHMANDU: Vice-President of ADB Xiaoyu Zhao reiterated ADB’s continued assistance for Nepal’s efforts to reduce poverty and promote inclusive growth and at the same time urged Nepal to remain focused on the country's reform and development agenda, while taking the peace and constitution drafting process forward. Zhao was informed of the government’s plan to address the energy crises and he affirmed ADB’s support to help address the power shortages. He stressed that developing alternative and renewable energy in a sustainable manner and strengthening Nepal’s economic and infrastructure linkages with neighboring countries through regional cooperation were also important and also called upon greater investment in public-private partnerships for sustainable development. He also congratulated the new government and expressed confidence that the new government would continue to forge a broad-based political consensus for taking the peace and constitution drafting process forward, along with creating a conducive environment for development activities and inclusive growth for all. Zhao made the comments at the end of a three-day official visit to the country. During his visit, Zhao held consultations with the newly-elected PM Jhala Nath Khanal and DPM and Finance Minister Dr Bharat Mohan Adhikary. Zhao also made field trips to various ADB-assisted projects in Lumbini and the surrounding areas, and met up with the project staff and beneficiaries. He visited the South Asia Tourism Infrastructure Development project, where ADB is supporting development and improvement of infrastructure and services in Lumbini. Zhao also visited the Bhairawa-Bhumai road that was constructed under the ADB-assisted Subregional Transport Facilitation Project.