Organic Agriculture: A promising sector for income generation in Nepal

The farm production system in Nepal is highly integrated and interlinked, and is characterized by subsistence farming. The majority of the farming communities have extremely small landholdings of less than 0.5 ha. Farming in Nepal has always been based on production techniques that are healthy and promote healthy existence of inter-related elements of the ecosystem – soil, plants, animals and people. Synthetically produced fertilizers and pesticides have hardly been used or never been used in the case of some hill areas in Nepal. The advent of commercialization of agriculture has exacerbated environmental problems and to top it up climate change is affecting communities who already have limited options for coping with adverse weather conditions. Therefore farmers are now exploring farming systems that can help to produce more from the available land, water and labor resources without either ecological or social harm, and increase their resilience to climate change. Organic agriculture represents one such potential area that is gaining momentum in economic, health and environmental aspects.

There is growing trend among urbanites for organic products, especially vegetables. An increase in purchasing power, education and awareness about health and quality of organic foods and the willingness to pay for healthy foods among consumers have increased the demand for organically cultivated vegetables in urban areas. This has also resulted in a vague mechanism of organic pricing and premiums although there is no established framework for organic product pricing. Market practices of organic agriculture in Nepal show individual farmers, entrepreneurs and cooperatives that are taking the practice forward as a remunerative enterprise. For example, one of the organic farm entrepreneurs in Nepal – Mr. Prem Lama of Aashapuri Organic Farm, Sanga, who has been farming about 5 hectares of land, is selling about 300 kg of organic products daily and generating more than NRs. 500,000 (US $6,250) a month. He is providing more than 50 organic products including ground apple, shitake mushrooms, cauliflower, cabbage and cucumber to restaurants and star hotels in Kathmandu. He has also been exporting asparagus, ground apple and mushrooms to Singapore. Currently there are also many private companies like Organic village, Kheti bazaar, Organic World and Fair Future working in partnership with local farmers and bringing organic products from different parts of the country to the Kathmandu Valley. In addition, many organic shops specially targeting the elite society and tourists are increasing in Kathmandu and Pokhara.

As the organic agriculture sector is gaining momentum in Nepal, it also possesses a great scope for its competitiveness, as Nepal is home to many potential products, namely spices, essential oils and medicinal plants, fresh fruits and vegetables. A significant area of agricultural land in Nepal is also organic by default, and is gradually increasing.  The enabling environment for the sector also seems to be favorable in Nepal with the recent establishment of the National Organic Agriculture Accreditation body (NOAAB) and the National Coordination Committee for Organic Agriculture Production and Processing System (NCCOAPPS), and policies supporting organic agriculture. The National standard for organic agriculture has also been established and endorsed by the government, and working guidelines for two certification systems (Internal Control System and Participatory Guarantee System) are being developed, both of which will serve as an important instrument for taking advantage of the international and domestic markets. The latter is a certification scheme particularly for small farmers whose products are of high demand in the local market, but who cannot meet the high cost of certification.

The role of organic agriculture in enhancing soil fertility and nitrogen inputs and addressing food security is well known. A participatory assessment of the organic agriculture conducted by ANSAB based on current price rates and growth potential also shows that the sector possesses high prospective of income generation in the peri-urban areas. In addition it can  involve youth and thus reduce the current alarming rate of youth migration to urban areas and abroad in search of better livelihood opportunities and higher incomes.