KATHMANDU: Nepal is predominately an agrarian country. How-ever, recent data shows that the total population living off the farm has dwindled from 80 per cent to 65.7 per cent in the last two decades.

Lack of attention from the government has contributed to the decline of this sector, with only 3.27 per cent of the budget allocated to agri-culture in the FY 2010-11. This is one of the lowest among agro-based developing nations, even lower than conflict-hit African nations which allo-cated more than four per cent.

The current caretaker government of Nepal had declared 2013 as ‘Agriculture Year’ to change subsistence into commercial agriculture. However, such an initiative requires a proper mode of attracting people in the farming sector.

Farmers in Nepal are forced to sell their products to middlemen who in return sell to big business houses such as supermarkets at much higher rates. This means that farmers see only a small fraction of return compared to what consumers pay. Farmers are, thus, inclined to discontinue their business and search for alternative incomes. Below are some of the benefits which local sourcing can provide to the agriculture sector:

• Provides sustainable wage for local farmers and encou-rages product and process innovation. It helps big agro industries to create employment opportunities and better wages.

• Maintains sustainable supply of goods and services with relatively low transportation cost and higher flexibility of procurement terms.

• Helps companies reduce costs by substituting imports and helps local farmers compete against imported goods.

• Helps in gaining social cooperation and reducing conflicts related to lack of economic opportunities.

• Helps to motivate local small scale producers by providing them market access leading to wider impact across the value chain.

If you own a business which uses agro-products, run a hotel or resort or manage a supermarket, it is always good to consider buying raw materials or products from your nearest local farmers. This will build your relation with the comm-unity and contribute to

social harmony. Buying local products not only creates a better reputation for your industry in domestic and international fronts but also gains a strong support from your local community.

(The author is a project manager at National Business Initiative and can be reached through info@nbinepal.org.np)