Bringing in foreign investment in contract farming will give the local farmers a chance to find a market. In contract farming, the companies and organizations also provide the farmers with the skills and techniques they need. It helps in making the farmers efficient.
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After one of my friends and family relative passed away from cancer, we learned about cancer from a US doctor involved in the treatment. According to them, toxic foods reduce the body's immune system and attract cancer.
In Nepal, it was also heard that farmers do not follow safety standards when spraying pesticides on crops, and because of that, skin diseases and even cancer occur. The facts of my friends dying of cancer, farmers getting cancer continued to disturb me.
That's why I got the idea of organic agriculture business. Due to this, in 2015 Golyan Group started agricultural work from Rangpur in Jhapa under Corporate Social Responsibility (CSR). Farmers in Jhapa initially refused to do organic farming. We ourselves leased 10 paddy fields and produced non-toxic rice in a place where there is no agricultural production.
The product did well but did not make the market. Farmers and our cost was Rs 7/8 per kg. But the market price is only Rs. After seeing the risk of failure of this concept, we bought it from farmers at Rs 12 per kilo and sold it at Rs 4. For that, the 'Mato' brand was born to work professionally. So far, the firm has been established in 6 places namely Jhapa, Kavre, Nawalparasi, Lamjung, Arghakhanchi and Gorkha.
We have three objectives. Now there are only issues of agriculture, not farmers. The farmer's stomach is hungry. Most of the young people who go abroad are from farming families. Therefore, the first thing is to increase the income of farmers. That is our first objective.
Second, the objective is organic production. The Ministry of Health and Agriculture should take charge of organic production. Organic produce increases exports, improves our health. Another objective is that the local level should work on this. Because the three tier government has the strongest local level. Therefore, we have also entered into an agreement with the municipality regarding the agriculture we are doing. Farmers are at the top of the
deal. For that we have established Janata Agro and Forestry Limited Company. From family farming to commercial farming and contract farming, we have developed high-tech entrepreneurial skills at the community level to promote export by processing and packaging high-value crops. We have partnered with the government and farmers to promote commercial productivity and clean business to support the quality of life and economic growth of Nepalese through green enterprises.
After this campaign started with farmers since 2015, my experience is that the government should work the most in the agricultural sector. The government should do various things through this year's budget to reduce the use of pesticides, expand organic farming and increase exports.
In the Budget and Economic Act of 2081/082, 2081, it is said that the laws necessary to open up foreign investment in contract farming will be amended. It is said that the local government will make sure that the amount that the farmer should receive from the contract farming organization or company for the produce ordered to be produced by the contract farming organization with the local government (village/municipality) will be given to the farmer. Since there is a lot of potential in agriculture in Nepal, bringing in foreign investment in contract farming will give the possibility of getting the market for the products of local farmers.
In contract farming, the farmers are given the skills and techniques needed by the organization. It makes farmers efficient. Incorporating crop calendar planning in contract farming is very beneficial for farmers.
Farmers have not been able to earn income due to the fact that the agricultural produce produced cannot reach the market. There is no provision for storage and processing of agricultural produce. Nepalese farmers are attracted towards crops that bear fruit in a short period of time and generate immediate income. Due to the geographical diversity of Nepal, it is able to produce various fruits that are currently in demand worldwide. But it may take 3 to 6 years for these fruits to become commercially fruitful. Therefore, contract farming organizations and companies need concessional loans to attract farmers to such farms. Irrigation system, organic fertilizer subsidy facility is needed.
It must be a public company to enter into a tripartite agreement. The company and its subsidiary companies should have an agro-processing unit within at least one hundred kilometers of the contract farming area. Public companies doing contract farming and processing need subsidized loans at 2 percent interest rate for a period of at least 7 years for processing, storage, and raw materials. Government owned forest lands should be made available on lease by the government for processing units and research development, electricity tariff rate of Rs 2 per unit should be implemented.
A one-door system is necessary for all decisions to be made by one body quickly. In Nepal, the cost of foreign products is lower compared to domestic products. There is a situation where foreign products are available in the market at lower prices than Nepali products. Therefore, in the purchase of such agricultural products from the government agencies, provision should be made to purchase Nepali products even if the price is slightly higher. This will encourage Nepali entrepreneurs.
Farmers have not received fertilizer as per demand. Competition is more open for the private sector to enter the market. Fertilizers are readily available in the market at lower prices than currently available. The government's expenditure on subsidy for garbage will also decrease significantly. Various reports have shown that the use of chemical fertilizers reduces the productivity of the soil and even the production is harmful to health.
Policies are needed to encourage the use of organic fertilizers instead of chemical fertilizers. Attracting investment in agriculture is inevitable. Investments should be made in agricultural industries involved in contract farming, agricultural production, processing, storage, distribution and marketing. Ready-made agricultural products imported from India in Nepal are also affecting the production here. In proportion to the subsidies and concessions given by the Indian government in agriculture, the import tax in Nepal is normal, which has created inequality for Raithane production. The 'level playing field' of India and Nepali agricultural production is not the same.
Therefore, agricultural reform fee is also necessary to increase the revenue of the country. According to the Economic Act, agricultural reform fee is currently 5 percent on some items and 9 percent on some items. 9 percent should be maintained in the next financial year. In order to encourage industries related to agriculture and forest products, 8 percent subsidy should be given to the export of agricultural and herbal products produced 100 percent in Nepal.
Since Nepal is a landlocked country, exporting its products abroad has to bear significant transportation costs. In this situation, if the government cooperates with the Airline Corporation or provides air transport services at a cheap price, it will be easier to deliver Nepali agricultural products to foreign markets. There is a lot of barren arable land in Nepal.
Such land should be leased by the local level for a reasonable amount and the amount should be contracted with farmers and agricultural industries to implement a system of leasing for agricultural purposes. This leads to proper utilization of the available land.
Countries including India have taken steps to ensure monopoly over the intellectual property rights of various food products such as basmati rice, millet. It is very important to register the intellectual property rights related to the original Raithane crop with the necessary authorities in order to achieve Nepal's monopoly. Exporting any agricultural product usually requires some form of certification. Such certification fees are very expensive. Local farmers are facing financial burden. The government should make a situation where the farmers can get assistance to export their products in case of paying the duty.
An internationally recognized food laboratory is indispensable for agriculture. There is a situation where food inspection takes months. Therefore, paving the way for private investment in currently operational laboratories leads to the upgradation of laboratories.
According to the existing legal provisions (Forest Act and Regulations), there is a provision to obtain permission from the Forest Office for herbs and forest products that are produced and used for commercial purposes. This has made smooth supply difficult. The regulation of herbs and forest products produced for commercial purposes should be brought under the Department of Agriculture by creating some exceptions.
There is a possibility that Nepal can do business of 7 trillion annually from wood alone. To take advantage of this opportunity, zero customs duty should be maintained on timber exports. If these issues are addressed in the upcoming budget, it will help to address farmers' issues and attract private investment and make the economy viable.
