Project description / objective
Sahaj aims to increase rural smallholder farmers’ income by facilitating their engagement in commercial agriculture markets which provide them with better opportunities to increase their income and improve their livelihood and competitiveness.
Phase II focuses on growth and investment in forward market linkages, strengthening the country’s commercialisation, processing and export of value-added agriculture products. It will provide financial and technical support towards increased provision of services and access to innovation for agri-businesses
Market system focus
Cardamom
Nepal is the world’s largest producer of large cardamom with 55 per cent share of the global market. It exports around 98 per cent of its produce to India. The large Nepali cardamom is not properly recognised for its quality and price. There is little value addition and branding of large cardamom in Nepal. Export diversification and new product development are of paramount importance for the cardamom sector. There is the opportunity to produce value-added premium products and create good domestic employment opportunities. If scaled, all actors in the value chain will benefit.
Dairy
Dairy production is spread across all districts in Nepal. The irony is that Nepal is a net importer of dairy products, importing more than 2,500 MT of skimmed milk powder (SMP) and many more other essential dairy products. There are a sizable number of dairy processors spread across the country, but they are limited to producing traditional products such as milk, ghee, plain yogurt etc. There are ample opportunities for improving the processing sector to produce value-added products which will create employment opportunities, increase domestic trade of diversified milk products and reduce imports.
Vegetable Processing
Increased demand of processed food has led to a surge in their imports. However, the number of vegetable processing units has also grown. They need both agriculture and non-agriculture services, such as investment, simple technologies and low intermediate inputs. Promotion of such units can benefit poor farmers, create employment opportunities in the value chain and contribute to poverty reduction by increasing the incomes of low-income households.
Maize
With the growing poultry industry in Nepal, the demand for maize has also increased every year. More than 70 per cent of the maize required by the feed-mills is being imported from abroad. Work in the maize sector, and the promotion of Nepali maize, can help reduce imports. The domestic supply of maize can be strengthened by improving post-harvest activity. Required changes to the sector also involve improvement and development of agriculture services such as custom hiring services, warehousing and storage, management of supply chain. Maize is the second most important crop in Nepal with high employment potential across the value chain and can contribute to employment generation and income increment.
Start up and innovation
The ‘ecosystem’ to support business start-ups is still at a nascent stage in Nepal with many challenges to creating a conducive environment for innovation and economic development in agriculture. Sahaj will put its efforts into building a sustainable and resilient ecosystem for start-ups in order to encourage the innovative business models and ideas in agriculture in Province 1 of Nepal.
Programme interventions
Cardamom
- Technical support to the Federation of Large Cardamom Entrepreneurs of Nepal (FLCEN) and its members to identify/develop/produce value-added products and support their promotion.
- Support FLCEN to explore the international market for cardamom and its diversified products.
- Assist in registration of collective trademark in different potential export markets.
- Facilitate the signing of bilateral and multilateral trade agreements with cardamom importing countries.
Dairy
- Support medium and big enterprises to build their capacity to include SMEs in the supply chain.
- Capacity-building of businesses that provide product diversification or value addition support to SMEs.
- Increased access to finance for milk processors through tailored loan products.
- Support to improve/develop standards and quality control of dairy products (protocol, registration, licensing).
- Support in awareness programmes to consumers on importance of proper packaging and required quality labelling.
Vegetable processing
- Support to improve the technical capacity of Food Technology and Quality Control (FTQC) businesses providing technical services and business skills training to SMEs in vegetable and allied crops processing.
- Support to improve/develop standards and quality control of processed products (protocol, registration, licensing).
- Support to improve the capacity of machinery manufacturers and packaging material manufacturers so that they produce machineries and innovative packaging materials as per the need/demand of SMEs in vegetable and allied crops processing.
- Increased access to finance for processors through tailored loan products so that financial institutions can offer tailored SME loan products.
Maize
- Support in capacity development of businesses that work to improve the technical/business skills of Custom Hiring Centres (CHC) , traders/aggregators, warehouses along the value chain.
- Support warehouses and BFIs to promote warehouse receipt financing so that warehouses and Banks and Financial Institutions (BFI) initiate warehouse receipt financing system.
- Assist in advocating about development of warehouse receipt financing policy (including minimum standard protocol for storage/warehouse facility to maintain the quality of related crop).
- Support in creating linkages between large traders/feed mills with small/local traders to help large traders/feed mills form networks with small/local traders for collection of maize in bulk.
- Increased access to finance for processors through tailored loan products so that financial institutions are capable of offering tailored SME loan products.
Ecosystem for start-ups
- Partner with relevant market actors to conduct innovation Bootcamps (experts working with business start-ups to develop a prototype and work on the basics and test it in the market).
- Link up with research and academic institutions to start incubation facility.
- Organise regular networking platforms (events where start-up owners, investors, experts share their experiences and expand their network).
Notable results (systemic change, poverty impact)
Phase II is in the early stages. Results will be published in due course.
[Uploaded July 2021]