Secretary Dr Sharma requested the stakeholders to propose an action plan, detailing required changes in the policy that will address the underlying issues limiting agriculture investment in Nepal.
The meeting progressed with three separate parallel panel discussions on three priority areas of interest and the champions discussed opportunities to call for action as follows
Investment opportunities and forms of capital
Technical assistance needs
The SMEs in Nepal have a low capital base, poor access to technology, and inadequate knowledge and information regarding business opportunities and marketing (Pandey 2004)1. Similarly, SMEs in Nepal also suffer from poor access to finance brought about by high-interest rates, large collateral requirements, inconveniences associated with the process, a lack of information, and inadequate institutional capacity, among other things (NRB 2019)2.
The outcomes of the panel discussions were summated for the whole participants offering a platform to deep dive into specific investment constraints and opportunities in Nepal.
The Ministry of Finance (2016) mentions that SMEs contribute 22% to the gross domestic product (GDP) and employ around 1.7 million people, without specifying the basis for the numbers. The contribution of SMEs to output, employment, and exports in the manufacturing sector is unknown3.
“At present, Nepal invests only 1% of its total foreign direct investment in agriculture,” said Mr. Chandra Prasad Dhakal, Acting President, FNCCI. “Investors want security and return on their investment and Nepal must work towards providing an enabling environment if we want FDIs which could help our farmers modernize farming with the latest technologies.”
Swisscontact is committed to initiating dialogue between the policymakers, private sector, development actors and financial institutions in Nepal towards promoting Nepal as a global destination for agriculture investments and developing synergies across the agriculture investor community.
The CASA programme is implemented by Swisscontact, NIRAS, and CABI and is funded by the Foreign Commonwealth Development Office (FCDO).
1) Pandey, G.D. (2004). Problems and Prospects of SMEs in Nepal. In N. Dahal. and B. Sharma (Eds.), WTO Membership: Opportunities and Challenges for SMEs in Nepal. Kathmandu: SMEDP and SAWTEE.
2) Nepal Rastra Bank (NRB). (2019). Nepalma sana tatha majhaula udhyamma bittiya sadhan parichalan [SMEs Financing in Nepal]. Kathmandu: NRB.
3) The Census of Manufacturing Establishments, 2011/12, which collected more detailed information than the National Economic Census, 2017/18, enumerated firms with ten or more employees only, and its raw data are not available in the public domain. The Survey of Small Manufacturing Establishments 2008/09 sampled firms with less than 10 employees in the manufacturing sector, but its raw data are not available in the public domain