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The Power of Farmer Cooperatives: How Nepali Farmers Can Effectively Unite to Jointly Purchase, Process Products, and Access Large Markets, Avoiding Past Mistakes
Nepal's agriculture presents a fundamental paradox. On the one hand, the sector is the basis of life and employment for the vast majority of the population. According to various estimates, between 62% and more than 70% of all workers in the country work in agriculture. On the other hand, its economic output is disproportionately small. The share of agriculture in Nepal's gross domestic product (GDP) has been steadily declining and today stands at around 21-27%. This disparity - with two-thirds of the population creating only a quarter of the nation's wealth - is evidence of a deep crisis of productivity and profitability.
The root of the problem lies in the very structure of Nepal's agricultural sector. It is dominated by small-scale, mostly subsistence farms that are poorly mechanized and focused primarily on self-consumption. The average farm plot size is only 0.9 hectares— an area that is insufficient to achieve economies of scale, implement modern technologies, or generate significant profits. Farmers are forced to resort to labor-intensive terracing of slopes to reclaim every bit of arable land from the mountains, highlighting the acute shortage of resources.
This structural weakness is compounded by a complex of systemic challenges. Soil depletion and erosion, accelerated by massive deforestation for fuel, reduce fertility. Global warming is disrupting normal farming cycles, and the spread of new pests, such as the white woodworm, is threatening entire plantations.
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By Alpha Business MediaNepal's agriculture presents a fundamental paradox. On the one hand, the sector is the basis of life and employment for the vast majority of the population. According to various estimates, between 62% and more than 70% of all workers in the country work in agriculture. On the other hand, its economic output is disproportionately small. The share of agriculture in Nepal's gross domestic product (GDP) has been steadily declining and today stands at around 21-27%. This disparity - with two-thirds of the population creating only a quarter of the nation's wealth - is evidence of a deep crisis of productivity and profitability.
The root of the problem lies in the very structure of Nepal's agricultural sector. It is dominated by small-scale, mostly subsistence farms that are poorly mechanized and focused primarily on self-consumption. The average farm plot size is only 0.9 hectares— an area that is insufficient to achieve economies of scale, implement modern technologies, or generate significant profits. Farmers are forced to resort to labor-intensive terracing of slopes to reclaim every bit of arable land from the mountains, highlighting the acute shortage of resources.
This structural weakness is compounded by a complex of systemic challenges. Soil depletion and erosion, accelerated by massive deforestation for fuel, reduce fertility. Global warming is disrupting normal farming cycles, and the spread of new pests, such as the white woodworm, is threatening entire plantations.