Background and Justification

Poverty in Nepal is largely a rural and agricultural phenomenon, and revolves around the issues of slow pace of rural development and low level of agricultural productivity. About 85 per cent of the Nepalese live in rural areas and 66 per cent work in agriculture to generate 38 per cent of the country’s GDP. Agriculture is not only a dominant economic sector but also the most important source of livelihood for a vast majority of rural people, including the poor, in Nepal.

Despite continued emphasis, agriculture has not progressed fast enough to meet the needs of small and marginal farmers, who constitute majority of the poor in Nepal. Over 70 per cent of the farmers operate on less than 1 hectare (ha) and 40 per cent on less than half ha of land. Small, traditional and subsistence crop farming dominates Nepalese agriculture, and crop yields are among the lowest in the region. The vast ecological and climatic diversities that exist in Nepal provide unique opportunities for poor farmers to produce a range of high-value agricultural products that can compete in local, regional and international markets. But this potential has remained largely untapped mainly due to limited or no access to the needed technologies and support services, including market. The needed technologies are either unavailable within the country or, even if available, inaccessible to farmers.

The agricultural research system in Nepal is dominated by the Nepal Agriculture Research Council (NARC), which is a public sector agency operating through a number of research farms and stations around the country. There are concerns that technologies generated by NARC have not been sufficiently responsive to the needs of the poor farmers in terms of the production environments in which they operate and the ecological potentials which they can tap for increasing production and incomes from their limited land. In the past three decades, NARC has developed and released a large number of improved production technologies, mainly in the form of high-yielding crop varieties. But only a few of them have been adopted by farmers because either the technologies do not meet the needs of the farmers or the extension system has failed to deliver these technologies to them.

Agricultural extension services in Nepal are delivered mainly by the Department of Agriculture (DoA) and the Department of Livestock Services (DoLS) under the MoAC through a network of district offices located in all seventy-five districts of the country. Over the past two decades, NGOs and local community-based organizations (CBOs) have also been providing agricultural extension services in some commodities and in some geographic areas, and this has generated positive results. But the number, as well as operation, of such NGOs is limited and the overall extension system of Nepal remains a public sector operation dominated by DoA and DoLS.

It is widely believed that agriculture development is the key to pro-poor economic growth and sustainable poverty reduction in Nepal. If agriculture is the engine of pro-poor economic growth, which it is, then pro-poor research and extension systems provide fuel for this engine to operate efficiently and effectively. For this, Nepal’s present agricultural research and extension system must be reoriented and redesigned to respond to the needs and priorities of the poor farmers.
How can the agricultural research and extension system be made pro-poor? What specific policy measures should be implemented to address the current gaps in policies and improve access of the poor farmers to appropriate technologies and support services in order to tap the potentials for high-value, competitive agriculture production? The present policy analysis is designed to address these issues.

Objectives of the Policy Analysis

The overall objective of the policy analysis is to investigate the current situation and provide justification and empirical basis for the formulation and implementation of pro-poor agricultural research and extension policies in Nepal. The specific objectives are:

• To study, analyse and assess the current system of agricultural research and extension service delivery from the point of the conditions, problems and needs of poor farmers in Nepal;
• To identify the policy gaps that have constrained the backward and forward linkages of agriculture and expansion of sustainable, high-value, commercial agriculture benefiting poor farmers in Nepal; and
• To recommend specific policy options and measures to make Nepal’s agricultural research and extension system pro-poor.

Methodology

The study will be based on both secondary and primary sources of information, and will include the following methods:

• Review and analysis of existing policy and regulatory frameworks, institutional structures, programmes, operating processes and procedures, and key gaps related to agricultural research and extension as well as technology development and dissemination mechanisms;
• Consultations with experts of related agencies (ministries, departments) in Kathmandu for the identification of study districts and key research issues for use in the research tools;
• FGDs with poor farmers, women and men of Dalit and Janajati households, of six districts representing the Mountain, Hill and Terai regions;
• FGDs with agro-entrepreneurs of the selected districts;
• Interactions with staff of relevant line agencies, NGOs and private sector organizations, especially agro-entrepreneurs, on pertinent issues, including the feasibility of proposed new policies; and
• Organization of national-level workshops with national stakeholders to validate the study findings, solicit feedback on the policy paper and discuss the proposed recommendations with a view to building awareness of the policy concerns and advocacy of pro-poor policies.
• Dissemination of the results of pro-poor policy analyses and dialogues through the use of information technology to establish specific websites and/or links with the websites of relevant development institutions.

Checklists will be developed for the FGDs and interviews. The analysis will be largely descriptive with the use of field-based information and findings of literature review.


The Lead Agency and Working Teams

IIDS will be the lead agency to carry out the policy analysis and will be responsible for meeting the reporting requirements with acceptable quality. It will work in close coordination with the NFP and the Planning Division of the MoAC.

The policy analysis team will be guided by a Steering Committee and working teams formed by the MoAC. The Steering Committee, led by the Secretary of MoAC, will review the study process, provide inputs to the study team, periodically appraise the study progress and review and provide feedback on the draft report. It will approve the final outputs/reports to be submitted by the lead agency, and recommend to the government through the MoAC for necessary actions. The working teams will support and assist the lead agency in policy analysis and in maintaining linkages, coordination and collaboration with related agencies.