Nepal is an agrarian country where majority of the people live in rural areas. The incidence and severity of poverty is twice in rural areas compared to urban areas (Human Development Report, 2014) which is largely due to poor agricultural economy. Alleviating poverty in such a situation is largely determined by the performance of the rural economy.
Livelihood of rural people largely depends on agricultural produces and natural resources. Agriculture sector remains the most important sector of the Nepalese economy. It employs around 75% of the population and accounts for 33% of the GDP. However, rural people who are reliant on agriculture have seen very little changes with regards to their economic status. Small scale animal husbandry is practiced through the country but product quality is poor, diary and meats produced are not adequate for the families themselves, let alone selling in local markets.
Poverty fell from 41.2% in 1995/1996 to 25.2% (Nepal Living Standard Survey 2010/11). Nepal is still considered a least developed country: Nepal ranked 149 out of 189 countries (UNDP Human Development Index Report 2018). For Nepal to graduate from a least developed country to developing country, it is crucial to increase the pace of economic growth, engage youth in income generation activities and promote high value cash crop production.
Nepal has a huge potential to increase agricultural productivity. However, it has to put efforts to improve agricultural productivity by innovating and importing improved technologies, minimizing migration, improving financial access to quality inputs, and building capacity of change agents, which will provide a robust and sustainable foundation for achieving poverty reduction.
GNI Nepal implements grassroots income generation and promotion activities through community-based social enterprises, and by mobilizing local resources. Agriculture development (high-value crops: seasonal and off-seasonal vegetables, medicinal, and aromatic plants) and livestock development (pig, poultry, fish, cow, goat, mule, yak, and buffalo) are major components of our income generation program. GNI Nepal has also been focusing on groups and cooperatives formation in order to establish community-level social enterprises.
Poverty reduction and alleviation remain central to GNI Nepal’s livelihood program. GNI Nepal has been implementing income generation and promotion activities through community-based social enterprises to enhance the food security of the communities by mobilizing local resources. It is an integrated approach that aims to reduce poverty in rural communities.
Objectives of livelihood enhancement activities are as follows:
- To establish self-reliant community institutions to provide financial and marketing services for economic activities
- To promote micro-enterprises for income and employment generation
- To enhance food security of ultra-poor households through income diversification
A large majority of the rural communities are poor and they cannot access credit and other financial services due to low and unsteady income. Cooperatives and income generation groups have the potential to foster economic growth in the communities and build a spirit of cooperation. With local ownership and control, and profits also get distributed locally. As such, these institutions could be vehicles for local economic development.
GNI emphasizes establishing cooperatives and promoting them as social enterprises. The objective of promoting cooperative’s establishment is to develop business service providers at the local level so that financial and non-financial services are available in the communities.
To meet the economic necessities of rural people and in particular to address the needs of those living below the poverty line, GNI collaborates with cooperatives and income generation groups. It aims to help low-income families to become entrepreneurs, promote the development of their enterprises, and create a strong partnership between marketing actors of micro-enterprise products /services and local service delivery institutions.
The goal is twofold: To reduce poverty among low-income families in rural areas and ensure institutional development and capacity building of local service delivery organizations so that they work as catalysts in the development of rural micro-enterprise sector. It also supports local economic development and helps strengthen the capacity of communities.
Livelihood support is especially targeted at the landless, small-scale farmers, and marginalized families that cannot afford or are not willing to take risks to invest in a business. These small-scale farmers do not have enough land to meet their food requirements. The aim of this program is to enhance food security of small-scale farmers and ultra-poor families by diversifying their income source.