Donors pledge big money to transform agriculture sector

- SANGAM PRASAIN, Kathmandu

Nov 13, 2014-

Donors engaged in drafting the ambitious Agriculture Development Strategy (ADS) have pledged to make large investments in Nepal’s farm sector and also asked the government to endorse the draft at the earliest so that they can plan accordingly.

The Asian Development Bank (ADB) on Thursday unveiled a scheme, as part of its commitment, to support Nepal jointly with other donors with an outlay of Rs 20 billion next year for the agricultural transformation process.

The proposed draft has recommended spending Rs 502 billion in 10 years, or around Rs 50 billion annually, including the contribution from the private sector and donors.

The strategic document that has envisioned an ambitious growth pattern in output and land and labour productivity for the next 20 years has been prepared with technical support from the ADB and 12 other development partners.

The ADS is expected to supersede the Agriculture Perspective Plan (APP) by 2015. On July 1, 2013, the ADS formulating team submitted a draft to the government. The document cost Rs 200 million and took 26 months to complete.

Amid concerns that Nepal’s farm sector would suffer from under-investment like in the past, the donor agencies who had pledged to bridge the investment gap in agriculture had been asked to appear before a parliamentary Agriculture and Water Resources Committee to clearly explain their commitment.

“We would like to see the draft finalized as soon as possible so that the development partners will be able to prepare their respective strategies for the implementation of the project under the common draft,” Kenichi Yokoyama, the ADB’s Country Director for Nepal, told lawmakers at Thursday’s consultation.

He said that the APP had not been implemented as per the objective. The APP, which was also prepared by the ADB, has been described as one of the best strategic documents, but it failed to attract investment due to a decline in donor support to the agricultural sector from the mid-1990s in the name of economic liberalization. The government followed suit by cutting farm spending.

“Experiencing the past, the new plan should be implemented in an effective manner so that it can address the disadvantaged and poor communities too,” he said. “A government-oriented approach will not be adequate to address Nepal’s farm sector as the issue is really the implementation part. Hence, there is a need for a collective approach to ensure that there is no resource gap while implementing the projects.”

Similarly, Beth Dunford, USAID Nepal’s mission director, said that USAID would be aligning its existing and new projects on agriculture with the ADS framework. “USAID is also ready to provide additional support for Nepal’s farm sector,” she told lawmakers. FAO representative Binod Shah said that the FAO would be aligning its five-year programmes with the ADS while International Fund for Agricultural Development (IFAD) representative Basu Aryal told lawmakers that its future programmes would be part of ADS.  

Likewise, the European Union (EU) representative suggested that the government form a steering committee to effectively implement the ADS and added that the private sector’s role needed to be defined clearly in the draft.

A sub-committee under the Agriculture and Water Resources Committee formed to look into ADS affairs will be submitting the final recommendation to the main committee by the end of November.

The chairman of the parliamentary committee Gagan Thapa told the donor agencies that the draft ADS would be submitted to the government by the first week of December, and that it was likely to be endorsed by the Cabinet by mid-December.

“The parliament’s role is to be a watchdog. Hence, we have asked the government for the document to study it further and make the government feel that the issue should not be taken for granted and that the ADS should not be kept as a piece of paper,” Thapa said. “Once the draft is okayed by the parliamentary committee, it will be easy for any government to take its ownership as past experience has shown that policy documents are often put on ice.”

The ADS has targeted boosting the average annual growth rate to 5 percent from the present 3 percent for the agricultural sector, and increase land productivity to $5,000 per hectare from the current $1,600. It also aims to increase labour productivity to $2,000 from $800 per worker.

Likewise, exports of farm items have been targeted to increase to $1.6 billion from $250 million through the implementation of the ADS.

The document has envisaged increasing round-the-year irrigation coverage areas to 80 percent from the current 18 percent. One of its ambitious targets is to halve poverty in less than 10 years through an agriculture-led economy.

The National Planning Commission has said that the ADS would help the government’s goal to graduate from the current status of a least developed country to a developing country by 2022, and so the document needs to be implemented wisely.

Published: 14-11-2014 09:20

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