Tuesday, January 8, 2013

Floriculture in Nepal

The consumption of cut flowers in the world is worth US$ 13,000 million. The main importers are the USA, Germany, France, UK, Switzerland, Sweden,Norway, the Netherlands, Denmark, Belgium, Italy, Australia, and Japan. Germany is the largest importer, followed by the US, France and Britain. Among the exporters , the Netherlands dominates the world trade (65%), followed by Columbia (12%) and Israel (6%). Thailand holds sixth position in export of cut flowers (Prasad and Kumar, 2005).In present context Half of the flowers produced in the world is consumed by western Europe alone and a large expansion in flower consumption is taking place in Eastern Europe,Japan, China, South Korea, Thailand and Indonesia.

Kathmandu valley is the central of Cut flower business in Nepal . The localization is mainly due to access to consumer-orientation and favorable natural conditions. The establishment of such industries takes place wherever consumers with sufficient purchasing powers are living. The existence of most of the star hotels, big business houses and international houses encourage the establishment of these industries in Kathmandu rather than in other places. Similarly, the topography and climatic conditions prevalent within the valley support the establishment of floricultural enterprises (Chhetri, 1999). Cut flower business has shown steady and continuous growth in Nepal. Due to urbanization and modernization, the demand of the cut flower has increased tremendously. There is ample scope for promotion of this business within Kathmandu valley as the demand is not fulfilled .Import of cut flowers from india and other countries by Hotels and other consumers can be substituted by Promotion of domestic production .

Mainly two seasons production are prevails for cut flower in Nepal i.e., summer season and winter season. In summer season, the demand of flower has been fulfilled by the Nepalese grower whereas in winter, wholesalers/retailers import flowers from India, as demand is not achieved by the Nepalese production. During the summer, the demand of the cut flower is accomplished by the production within Kathmandu, Bhaktapur, Lalitpur and nearby area from valley.

Organic Agriculture

A.G. Howard, one of the pioneers of organic agriculture observed farming in India for many years and established  the theory of organic agriculture. The theory provokes for the sustainable farming through balancing the soil by recycling organic materials back to the soil i.e. resource-cycle farming which existed in Asia for over a thousand years. However, modern agriculture has been focusing an economic efficiency without giving much attention on environment. Without doubt; such pursuits followed side effects and the green revolution is one of the example (Murayma, 2001).

Evidences from all over the world shows that the organic farming has increased the crop yield by doubled or trippled in land where resources are poor, diverse and complex. In irrigated condition, if maintained the yield. While, in the industrialized agricultural system, transition to sustainable agriculture could decrease the production per hectare by 10-20% in short form, but provides better level of financial returns of farmers (Yadav, 2001).

Sustainable means keeping efforts/things continuously, that is development without destruction (Dhital et.al. 2005). It is to meet the needs of present without compromising the ability of future generation to meet their own needs (WCED, 1987).

Traditionally organic agriculture has always been practiced in Nepal. Hill farmers depends primary on organic manure (FYM) either as compost prepared from locally available organic materials as a FYM (Budathoki et.al. 1993 cited in Neupane, 2004).

Organic agriculture sector is developing rapidly around the world and is being practiced in approximately 110 countries. World wide land under organic agriculture is estimated to be 30.4 million ha. Nepal has 26 organic farms, but Yadav (2001) reports two certified two farms in Nepal with 125ha land. Accordingly countries with greatest organic area are Australia (12.3 million ha), China (2.3 million ha), Argentina (2.2 million ha) USA (1.6 million ha). and study by IOFAM show that, increase in 1.8 million ha area at the end of 2006.

The global market of organic products is increasing. The estimated sales expanded by 7 to 9% . The higher growths of sales were observed in Western  Europe and North America. However, the home of  60% of the world population, Asia has a small market.

Organic certification or guarantee is required in Nepal. International certification is expensive. Affordable verification systems for the farmers should be developed (Bhat, 2005).

Major organic importer countries (like USA, Japan, EU) have developed extensive legislation for organic products to enter into their markets for which certification according to official standard is a precondition (Shakya, 2005).

Organic agriculture offers trade opportunities for farmers in the developing and developed counties. The market of organic product is expected to grow globally in the coming years and high growth rate (from 10-15 to 25-30%) are expected. The organic market expansion makes it possible for farmers to reap the benefits of trade with relatively high price premiums (Yussefi and Willer, 2002 )

POVERTY, INEQUALITY AND LAND REFORM IN NEPAL

The eradication of poverty is the biggest challenge faced by policy makers in Nepal. Poverty is increasingly concentrated among small farmers and agricultural labourers (WB, 2006). Present socio-economic structure of the country reveals that land is the main property and source of income for the majority of Nepalese people. Land reform is important also in the context of incipient industrial and commercial sectors which at present cannot cater for the rapidly growing population. In this respect, increase in agricultural productivity through secure access to land can potentially be one of the most effective approaches to alleviate rural poverty.

Over the last decade aggregate poverty reduced significantly from 42% to 31%. However, the decline was slow in rural areas compared to urban areas and is still high at 35% (WB, 2006). Whilst overall growth increased and overall poverty reduced, the Gini coefficient increased from 34.2 to 41.4, indicating a rise in inequality as the growth was seen most evident in the rich community. The country’s GDP may be constrained by unequal land distribution. For nearly one third of total agricultural land is occupied by 7% of upper households whereas nearly 20% lower households have to survive with less than 3% of total agricultural land (CBS, 2004a).

Land is often misallocated which then hampers agricultural development and perpetuates rural poverty. Those who have land don’t know how to use it most effectively and those who know how to use it, don’t have it. Consequently, the agricultural productivity of the country is much lower compared to other countries in the region (WB, 2006). These all suggest that there is potential for increasing farm production three to four-fold through land and agrarian reform (NPC, 1998). So, proper policy programme to transfer agricultural land from unskilled to skilled farmers through effective land reform program may be an important instrument to alleviate poverty and disparity.

In past fifty years, there have been many attempts to a redistributive land reform program to alleviate poverty and inequality, but without success. The land reform program of 1964 had heightened social and psychological consequences, but had little impact on agrarian structure. The government confiscated and redistributed only a very small fraction of land above the ceiling compared to its

expectation. In 1994 the High Level Land Reform Commission submitted the Badal Commission Report to implement land reform; however no steps were taken to do so. In 2001, another land reform program with a revolutionary tag was announced. The focus of the program was to amend the Land Act 1964 in order to reduce the legal size of land holding per family.But Thapa (2001) points out that this was merely a political ruse as the political pronouncement was made without weighing up of socioeconomic implications, and exclusive of any schemes and information of land appropriation and redistribution. In conclusion, there has been little progress in the last fifty years in land reform.

Thursday, September 1, 2011

Factors influencing agriculture marketing

Author: Govindarasan

FACTORS INFLUENCING AGRICULTURE MARKETING

Dr. M. Govindarasan. MA., M.Phil., Phd. Project Associate, Department of Humanities and Social Science, Indian Institute of Technology, Madras, Chennai - 600 036.

and

K.Valarmathi, Full Time Phd Research Scholar, Department of Economics, Presidency Colloge, Chennai 600 005.

India's farming crisis The distress of farmers in India can be traced back to the introduction of technology-led, capital intensive farming in the heyday of the Green Revolution. With the advent of 'economic liberalisation' and the globalisation of trade, this distress has been aggravated. Unfair rules of the multilateral global trading regime have depressed global and domestic prices, and denied Indian farmers adequate remunerative prices. The poor farmer is squeezed between high input costs and low returns. Credit obtained from formal or informal banking systems is unable to bail him out of this precarious situation. Caught in a vicious debt trap, many farmers have resorted to suicide. BT cotton and the debt trap Misled and misguided, the changeover to Bt cotton proved to be a total failure, causing severe losses for our cotton growers. The enormous loss and the resultant debt trap forced thousands of cotton growers to commit suicide. Bt cotton proved to be a total fiasco. Thousands and thousands of farmers have already committed suicide, and there seems to be no end to this tragic situation. Trends in suicide remain unabated even now, especially among cotton growers. Significantly, farmer suicide is reported mainly from the high-tech agriculture belts, such as Andhra Pradesh, Karnataka, Tamil Nadu and Punjab.

All these states have embraced capital intensive and 'cutting edge' technology in the name of boosting production. In areas where traditional agricultural practices and organic farming are prevalent, such as Orissa, Jharkhand, Bihar, Chhattisgarh, suicide is unheard of. The ripple effect As far as agriculture is concerned, it is alarming that India is moving towards a point of no return. From being a self-reliant nation of food surplus, the country is becoming a net importer of food. In this context, policies to promote contract and corporate farming, the use of genetically modified seeds such as Bt cotton, and genetic synthesis in aquaculture and industrial poultry farming, threaten to undermine food security and the livelihoods of poor farmers. There are authenticated reports that alarmingly high numbers of cattle have died from grazing on Bt cotton residues in fodder. And, the Government of India's Genetic Engineering Approval Committee (GEAC), under the Ministry of Environment and Forestry, is baffled at the news of sheep mortality, on account of grazing in the Bt cotton fields in Warangal district in Andhra Pradesh. The GEAC has already admitted that toxicity studies on Bt cotton leaves have not yet been conducted, and although it has now asked the department of biotechnology to conduct studies, the lukewarm attitude of GEAC to ascertain the level of Bt toxin responsible for killing livestock is highly questionable. Whose trade organisation? The production of transgenes through genetic manipulation is bad science, unethical, and totally against the natural order that is responsible for the evolution and sustainability of life. It is fraught with the danger of genetic pollution and contamination, the destruction of ecosystems, environmental degradation and DNA deviations.

The liberalisation of heavily subsidised edible oil imports led to the decline in oil seed prices in India, financially ruining oil seed growers in the country. This totally negated previous efforts to make India almost self sufficient in the oil seed sector by 1998. Now, almost 50 per cent of edible oil is imported, resulting in annual spending of $1,800 million in foreign exchange. Inept, amateurish and mediocre handling of our priorities is to blame for this ugly situation. The Government is playing a faulty game of cash crops over food crops, and promotion of corporate farming at the cost of traditional agro-rural systems, especially in the dry and arid zones of the country. Such policies will further add to displacement and migration to urban areas. Blind trade liberalisation and a market driven economy will throw the country into a cobweb of trans-national corporations. Importing oil seed is only the tip of the iceberg; it is a prelude to the beginning of the end of Indian agro-systems and their ultimate take-over by multinational corporations. Distorting, or not distorting... Heavy subsidies given to the farming sector in developing countries are basically responsible for dismantling India's agro-system, making it economically unrewarding. Some 'trade experts' and negotiators in the developed world try to justify their misdeeds by putting subsidies into categories: "trade-distorting" and "non trade-distorting

Government should remain determined in all future negotiations to focus primarily on the interests of small and marginal farmers. Agriculture is not only for trade; it is a way of life. RURAL MARKETING Rural marketing facilitate flow of goods and service from rural producers to urban consumers at possible time with reasonable prices, and agriculture inputs/ consumer goods from urban to rural. Marketing as a function has started much earlier when civilization started but not recognized as marketing. All economy goods are marketed in terms of goods and services (Barter system). Now money is being practiced as a good exchanging medium. The market may be a street, or a small town/ metropolitan city, Developments in infrastructure, transport, and communication facilities has increased the scope of the rural market. Environment The difference between rural and urban markets on the basis of various socio – economic factors, most dominant among them being the source of income, the frequency of receipt of income, the seasonal nature of income and consumption. Rural markets are small, non- contiguous settlement units of village relatively low infrastructure facilitates, low density of population, their life styles also being different. Rural consumers are mostly farmers whose income receipts are dependent on the vagaries of nature.

Agri-Marketing Rural population has been increased about 74% of the total population; the demand for products and services has increased a lot in rural areas. Green revolution in the North and white revolution in the West has brought about a new prosperity in the lives of rural people. Government emphasis on rural development has caused significant changes in the rural scenario. Moreover, the special attention given for infrastructure development through the successive Five-year plans has improved the buying and consumption pattern of rural people.

The Rural Agro – Products: The rural agro-products are * Fruits & Vegetables * Grains * Flowers Rural sale products * Milk & poultry products * Handicrafts and Hand loom products * Tribal village products like tamarind, Lac, soapnut etc The peculiar characteristics of agricultural produce are: * Bulkiness * Perishability * Wide varietal differences * Dispersed production * Processing needs for consumption * Seasonality India is the largest producers of mangos and banana in the world, and top ten producers of apples and pineapples. Other fruits, guava, sapota, papaya etc.

Area under fruits which was estimated to 1.45 millions hectares in 1970-71 grow slowly and gear up after 1991-92 to 2.8 million hectares. DAIRY India is the largest milk producer and processing of milk was largely in the cooperatives sector.Rural marketing depends on agricultural produce, the production is seasonal and the consumption is spread out equalization of demand and supply has to be done. In addition, the raw agricultural produce as marketed by farmers has to be processed by many middlemen This include collection and assembling, financing, grading and standardization, storage, transportation, wholesaling and retailing these functions performed by village merchants, commission agents, wholesalers, processors etc.

These people seek returns commensurating with their investments of capital, time and labour. As a result, the middlemen get more share of the price than the producers.

REGULATED MARKETS: There are more than 5000 primary and Secondary Agricultural produce wholesale assembling markets functioning in the country. These markets are meant for the farmers to take their produce for sale. These markets facilitate formers, immediate cash payments. The directorate of state Agricultural Marketing Board or Registrar of cooperative marketing societies is controlling these markets. The market is run by an elected committee comprising of members from the farmers community, commission agents/wholesalers and some government nominees from Directorate of state agriculture / cooperative societies.

COOPERATIVE MARKETING: Another major improvement for rural producers is the formation of cooperative societies. Farmer's common interest helped to increase the incomes of the farmers and avoid exploitation of the middlemen. There are about five lack cooperatives working but very few cooperative societies in selected areas like Dairy, sugar, oilseeds, Mahagrape in Maharastra, tomato growers in Punjab etc. succeeded in cooperative processing industry. Problems in Rural Marketing The rural market offers a vast untapped potential. It is not that easy to operate in rural market because of several problems and also it is a time consuming affair and it requires considerable investments in terms of evolving appropriate strategies with a view to tackle the problems. The problems are. * Underdeveloped people and underdeveloped markets * Lack of proper physical communication facilities * Inadequate Media coverage for rural communication * Multi language and Dialects * Market organization & staff Underdeveloped people and underdeveloped markets The agricultural technology has tried to develop the people and market in rural areas.

Unfortunately, the impact of the technology is not felt uniformly through out the country. Some districts in Punjab, Haryana or Western Uttar Pradesh where rural consumer is somewhat comparable to his urban counterpart, there are large areas and groups of people who have remained beyond the technological breakthrough. In addition, the farmers with small agricultural land holdings have also been unable to take advantage of the new technology. Lack of proper physical communication facilities Nearly 50 percent of the villages in the country do not have all weather roads. Physical communication to these villages is highly expensive. Even today, most villages in eastern part of the country are inaccessible during monsoon season.

Inadequate Media coverage for rural communication A large number of rural families own radios and television sets there are also community radio and T.V sets. These have been used to diffuse agricultural technology to rural areas. However the coverage relating to marketing is inadequate using this aid of Marketing. Multi language and Dialects The number of languages and dialects vary from state to state region to region This type of distribution of population warrants appropriate strategies to decide the extent of coverage of rural market.

THE MAJOR WEAKNESS AND CHALLENGES IN THIS SECTOR * Traditional mind not to react new ideas. * Agricultural income mostly invested in gold ornaments and weddings. * Low rural literature. * Not persuading new thinking and improved products EMERGING TRENDS IN MARKETS ON LINE RURAL MARKET (INTERNET, NICNET): Rural people can use the two-way communication through on – line service for crop information, purchases of Agri-inputs, consumer durable and sale of rural produce online at reasonable price.

Farm information online marketing easily accessible in rural areas because of spread of telecommunication facilities all over India. Agricultural information can get through the Internet if each village have small information office

NEED BASED PRODUCTION: Supply plays major role in price of the rural produce, most of the farmers grow crops in particular seasons not through out the year, it causes oversupply in the market and drastic price cut in the agricultural produce. Now the information technology has been improving if the rural people enable to access the rural communication, farmers' awareness can be created about crops and forecasting of future demand, market taste. Farmers can equates their produce to demand and supply, they can create farmers driven market rather than supply driven market. If the need based production system developed not only prices but also storage cost can be saved. It is possible now a days the concept of global village.

MARKET DRIVEN EXTENSION: Agricultural extension is continuously going through renewal process where the focus includes a whole range of dimensions varying from institutional arrangements, privatization, decentralization, partnership, efficiency and participation. The most important change that influences the extension system is market forces. There is a need for the present extension system to think of the market driven approach, which would cater the demands of farmers.

RECENT DEVELOPMENTS IN TAMILNADU: Many remote villages now connected to main roads and link roads with the help of innovative technique of grass root development by the people for the people of the people. "Uzhavar sandhai" the another development of rural farmers reducing middle men and also cost to the benefit of urban society. The Innovative –" Uzhavar sandhai" The recent changes in agricultural produce sale by farmers in Uzhavar sandhai leads to direct selling vegetables and other commodities to urban needs. Government of Tamilnadu started Uzhavar sandhai all over the state for the purpose of direct selling their produce to urban needs, not only selling of rural produce but also exchange of their ideas each others. Procurement Prices / Support Prices These prices are more than minimum prices, which facilitates government bulky procurement for Public Distribution System and maintains buffer stock levels.

Farmer has little control over prices, which are determined by the broad factors of, supply and demand market at large. CONCLUSION Considering the emerging issues and challenges, government support is necessary for the development of marketing of agricultural produce. The government may adjust suitable budget allocations to rural infrastructure plans, and proper supervision for effective plan implementation. The core areas like transport, communication, roads, credit institutions, crop insurance for better utilization of land and water at appropriate level. The rural people and markets will definitely develop rural income and reduce poverty, on the whole countries economy will boost at an expected level.

MANAGE an extension management institution may provide extension services to rural people in crop information, price information, insurance and credit information by using various media. MANAGE may recommend / advice to central and state governments on suitable infrastructure development, current problems in rural markets and problem solving techniques.

REFERENCES

1. Communication and Rural Development by J.B. Ambekar Yadav. Published by Mittal Publications (New Delhi). 1992.

2. Development of Agricultural Marketing in India by Dr. Rajagopal Published by Print well (Jaipur).

3. Marketing Management by Philip kotlar. 1992. 8th edition.

4. Rural Marketing by T.P.Gopal Swamy published by Wheeler publishings (New Delhi) 1998.

5. Indian agrl. Journal of agril.economics vol. 54

6.Krishan Bir Chaudhary, chairman of India's largest farmers' organisation

Article Source: http://www.articlesbase.com/social-marketing-articles/factors-influencing-agriculture-marketing-4196114.html

About the Author

Dr. M. Govindarasan. MA., M.Phil., Phd. Project Associate, Department of Humanities and Social Science, Indian Institute of Technology, Madras, Chennai - 600 036.

and

K.Valarmathi, Full Time Phd Research Scholar, Department of Economics, Presidency Colloge, Chennai 600 005.

Tuesday, August 30, 2011

Joint Venture of Nepal-Korea in BioTech

The medicinal plant is going to be established in joint venture of Nepali and South Korean investors.The industry will use medicinal plants available in Nepal as raw materials for their product.
Himalayan BioTech of Nepal and Korean investor are investing Rs. 400 million for establishment of this company. There will be 30 percent contribution of Himalayan Biotech and rest will be funded by Koreans.
According to Mr.Janardan Lamichheni ,consultant of Himalayan Biotech,the Plant will be established with in year."we are looking for the location in Sitapaila in Kathmandu and in Bhaktapur but the location is not fixed yet."said Mr. Lamichheni.
The plant will produce beauty products and food additives.These products will be produced by using herbal plants . The company is planning to produce beauty products in first phase and food additives in second phase and allopathic drugs in third phase.

Thursday, August 25, 2011

World Bank kept Nepal in the blacklist

World bank kept Nepal in the blacklist as it tops the lowest capacity for getting loan form international market.

The report published by world bank in Saturday kept Nepal in CCC+ .according to report CCC+ means high default risk (High risk for loan) .There will be problem in foreign direct investment and loans after rated as CCC+.

The rating is done by taking the reference of the gross national income(GNI),gross national product(GDP),export /loan ratio,deposit for import,movement of growth rate,devaluation of money fulfillment of legal obligations are the basis of the evaluation which indicated Nepal as poorest country and kept in black list .

But the government officials claims that the condition of Nepal is not poor as said by World bank.according to Mr. Keshav Acharya,ex-senior consultant of ministry of finance said that we have some weakness and it is not good reason for keeping in black list. he claims that due to lack of rule of law in the country may have bad impression in the report.

Till now Nepal hadnot taken large scale loan from outer world expect world bank, International Monetary Fund(IMF) and Asian Development Bank(ADB) .There was delay in repayment of loan from the Russia .The so called “Sovern” rating in the world bank report also indicates the economic development of the the nation.International investor and lenders analyse the and evaluate according to the sovern rating then they are going to lend money for any country.

The world economic forum also rated Nepal in 131 places In 2011.”This creates bad image of Nepal in international arena and threaten the small investor who are cooperating with Nepali investors.“ Said Economist prof.Dr. Bishombhar pyarakul.

According to report the condition is worst than that of Iraq.”This is responsible for the withdrawal of the previously committed international investments.” Mr.Pyarakul added.

He argued that such rating doesn't cause direct impact as Nepal had not any big international investments but the possibility of future investment will become low.

According to report ,the rating creates “ceiling” for taking loan although the nation had not taken loan from international market.

Wednesday, August 24, 2011

Business Developmant Plan -Graduate Seminar in Snapshot.

The Graduate Seminar of Business Development Plan of MBA IVth trimester was succesfully completed in August 23,2011,here is some of the snapshot of the program.