May 5: Most of the projects that are eligible for start-up enterprise loans pledged by the government are projects related to agriculture and animal husbandry. A total of 1,658 projects were registered for startup ventures with the Industrial Enterprise Development Institute (IEDI), an autonomous body established by the government which is dedicated to developing human and knowledge resources for entrepreneurship and business promotion in Nepal through a number of impact-generating quality tools such as training, research, consultancy, enterprise education, and management development programmes.

The IEDI has listed 394 projects as eligible for the startup enterprise loans.

More than half of the eligible list, that is roughly about 200 projects, pertain to agriculture and animal husbandry businesses. 

Most of the startup projects eligible for startup enterprise loans are from Kathmandu, Bhaktapur and Lalitpur. There are 119 projects from these three districts.

Apart from these, some projects are also related to food processing.

The productivity of this sector is very low as most of the agriculture and animal husbandry in the country are subsistence oriented.

According to a report published last December regarding Nepal’s food security and agricultural commercialization program, supported by the Asian Development Bank, the productivity of Nepal's agricultural sector was found to be the lowest in South Asia. The report pointed out that the major obstacles for the commercialization of agriculture were widespread fragmentation of land, lack of appropriate cultivation and cropping techniques, lack of timely supply of chemical fertilizers and seeds, and limited financial and agricultural infrastructure.

Juna Mathema, chairperson of the Startup and Innovation Forum of FNCCI, says that it is positive that there are many projects related to this sector in the context of the challenges of commercialization of agriculture in the country.

“Neighboring India has already taken a leap in agriculture startups. There are startups related to agriculture in India's AG hub. It seems that the same kind of ecosystem has been developed by starting agro in a different way in Nepal,” said Mathema.

Stakeholders say that startups related to agriculture will also bring new technologies related to agriculture, which will help in the modernization and commercialization of agriculture. For example, China has succeeded in increasing productivity rapidly in 2023 through the use of technology, according to Chinese international television CGN.

According to a report published in December last year, despite extensive damage to agriculture due to natural calamities, agricultural production increased widely. Nepal is also implementing the Prime Minister's Agriculture Modernization Project for the modernization and commercialization of agriculture. Its purpose is to maintain food security, reduce import of agricultural products and increase exports.

The government has also announced the youth startup grant program in the budget of the current financial year to attract young manpower in agriculture and livestock business and develop entrepreneurship.

The implementation of this program under the Prime Minister's Agriculture Modernization Program has already started in nearly two dozen districts as per Dr. Jit Bahadur Chand.

 “Under this programme, we give a maximum of Rs 400,000 to a youth. But, those proposals should be innovative. We have also been instructing our offices in different districts to support innovative programs,” he said.

According to Mathema, there is plenty of room for innovation in the agricultural sector.

She said, “The criteria set by the government for giving loans to start-up enterprises must include innovation. Incubation center is the link of startup.”

Chand says that educated youth now want to engage in agriculture with the help of technology. Various technologies are being used in agriculture, including artificial intelligence. This will help increasing Nepal's agricultural production, make it competitive and sustainable.

Apart from projects related to agriculture and animal husbandry, proposals for restaurants, spice processing industry, bakery, cafe, small scale industry, chemicals, thangka/handicraft related businesses are also in the eligible list. In the current fiscal year 2080/81, the IEDI is planning to provide start-up enterprise loans to 200 projects and has fixed the date for the project presentation to the applicants who are in the list of eligible projects from April 29 to May 16. 

According to the annual national accounting estimates of the current year 2080/81 published by the National Statistics Office a few days ago, the growth rate of this sector is estimated to be 3.05 percent.