Country Context

Agriculture sector engages around 66% of the total population in Nepal. It contributes one-third of the nation’s GDP with significant contribution to national economy. It creates a diverse array of jobs and employment from farming to small-scale enterprises. Nepal is vulnerable to food insecurity and recurring natural disasters like floods, drought, landslides, earthquake, diseases and pest outbreaks. The agriculture sector in the country is still dominated by subsistence farming resulting in low productivity and production of agricultural commodities.

FAO Nepal is working in close coordination and cooperation with the Government of Nepal (GoN) from 1977 A.D aiming to promote agricultural development, achieving food and nutrition security, uplifting livelihoods of rural farming community and promoting sustainable natural resource management through policy support, strengthening institutional capacity and providing technical assistance in the implementation of projects and programmes aligning with government strategy and priorities. 

FAO incorporates a gender-responsive approach in the project cycle management to safeguard the sustainability of the intervention and ensuring equitable growth. It focuses on the ecosystem restoration, adaptation and mitigation actions against the impacts of climate change in the agriculture and forest sectors encouraging synergies and trade-offs between the two.

Food insecurity remains a serious challenge for Nepal. Agricultural growth provides the principle pathway to tackle this problem. For agriculture to make this contribution, land and labour productivity have to grow to start with. This is the only way to break the current vicious circle which prevents farmers from transacting in the food markets due to low productivity and thus in purchasing modern farm inputs to raise the productivity. Public investment has to lead this process, notably in irrigation and infrastructure, technology generation, prevention of animal and crop diseases and pests and natural resource conservation. It is equally important to take steps to improve access to nutrition and safe food for vulnerable communities.

Complementary to the existing Government efforts as well as those of the DPs, FAO will contribute to enhancing national and local capacities for improving productivity and ensuring food security through the achievement of the following expected outcomes and outputs.

Effective implementation of the Government policy and programmes depends considerably on the completeness of the policy and related institutional environment. One long-standing weakness in this area is incomplete design of supportive policies and acts, and weak monitoring of the compliance to existing policies. Institutional capacity for strategic planning and implementation is also limited. Quality and timely availability of agricultural and livestock statistics has also constrained the formulation and implementation of programmes to boost agricultural production and productivity.

The GoN is in the process of formulating a National Food and Nutrition Security Plan and the long-term Agriculture Development Strategy, as well as to conduct a new agricultural census. All these processes would benefit considerably from FAO technical assistance. Several UN agencies and development partners are also assisting in these activities and therefore this priority area involves possibilities for high level of partnership and collaboration.

Almost all of Nepal’s development strategy and policy documents have emphasized the urgency of market to orient and commercialize the country's largely subsistence-economy, as one of the pathways to breaking the vicious cycle. The other pathway is to enhance productivity. A value chain framework is deemed essential for identifying appropriate interventions from farm to the market. Public investments in key infrastructure and service areas, notably irrigation, rural roads, post-harvest technology and storage and market and price information, should play an important role, but the bulk of the investment has been envisaged to flow from the private sector.

The latter will not happen automatically but will have to be encouraged through appropriate pricing and other policies. Many countries around the world are increasingly promoting this approach, i.e. public-private partnerships in a value chain context. FAO has the comparative advantage of tapping this knowledge base and best practice.

Nepal’s natural resources are being over-exploited beyond their retaining and regenerative capacity for a number of reasons which include unsustainable land use practices, unsustainable exploitation of bio-diversities, deteriorating watershed services, increasing conversion of forest land to other uses and more recently adverse effects of climate change. FAO jointly with the Government and other development partners will contribute to enhancing the national capacity to promote improved sustainable management and development of natural resources, including land management, forestry and watershed management, and climate charge mitigation and adaptation.