linkages between nepalese agriculture and poverty reduction
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Linkages between Nepalese Agriculture and Poverty Reduction. Krishna Prasad Pant, Ph. D. November 11, 2005. Consumption and income are highly skewed. Efforts in Agriculture to Reduce Poverty. Agriculture Perspective Plan High value commodities in pocket areas AGDP growth Poverty reduction - PowerPoint PPT PresentationTRANSCRIPT
Linkages between Nepalese Agriculture and Poverty Reduction
Krishna Prasad Pant, Ph. D.
November 11, 2005
Consumption and income are highly skewed
Per capita consumption and Income
0
5
10
15
20
25
30
35
40
45
Poorest Second Third Fourth Richest
Quintiles
Rs
000
Expenditure Income
Share of consumption by different quintiles
Poorest6%
Second9%
Third13%
Fourth19%
Richest53%
Efforts in Agriculture to Reduce Poverty• Agriculture Perspective Plan
– High value commodities in pocket areas– AGDP growth– Poverty reduction
• Poverty Reduction Strategy Paper – Agriculture development– Accessibility to backward/inaccessible areas– Targeted programs - access to resources, improving
infrastructures, skill generation, income generating activities, targeting
– Poverty mapping and monitoring• 10th Plan
– Access of poor to productive inputs and development• National Agriculture Policy
Reducing rural poverty is closely linked with food security
• Food Availability– Depends on global agricultural productivity– International and national market and distribution systems– International and national trade policy (make sure food is available to all
at a reasonable cost)
• Food Access– Poverty reduction (hunger is a result of poverty)– Food markets (processing and storage)
• Food Utilization– Nutrition education – Nutrition interventions to supplement food – Health care– Safe water provision– Sanitation
• Agriculture is linked both to poverty and food security
Agricultural household with
land (%)
Av size of agri land
(ha)
Irrigated area (%)
1995/96 83.1 1.1 39.6
2003/04 77.5 0.8 54.3
No steady growth in agriculture
-4
-2
0
2
4
6
8
10
12
% p
er a
nn
um
AGDP
NON-AGDP
Agricultural production index
0
50
100
150
200
250
300
94/95
95/96
96/97
97/98
98/99
99/20
00
2000
/01
2001
/02
2002
/03
2003
/04
2004
/05
Per
cen
t to
bas
e le
vel
Fishery
Industrial crops
Food grain
Livestock
Forestry
Fruit-veg-pulses
Capability poverty more severe than income poverty
• Elements that contribute to ‘capability’– Economic power– Social power, – Political power
• Deprivation of basic capabilities, rather than merely as ‘lowness of incomes’ (Amartya Sen, 1999)
• Simultaneous equations: – income is an important means to capabilities– enhanced capabilities expand ability to be more
productive and earn a higher income.
Distribution of wage earners in agri and non-agri
0
20
40
60
80
100
120
Poorest Second Third Fourth Richest
Quintile
Per
cen
t
In non-agriculture
In agriculture
Wage rate
0
50
100
150
200
250
Poorest Second Third Fourth RichestQuintile
Rs/
day
Non-agriculture
Agriculture
Agricultural households and literacy
0
20
40
60
80
100
Poorest Second Third Fourth Richest
Quintile
% h
ouse
hold
% agri household
Literacy of agri household head
Winter vegetable growing households & input use
0
10
20
30
40
50
60
70
80
Poorest Second Third Fourth Richest
Quintile
% h
ouse
hold Winter veg growing hh
improved seedfertilizerwater pump
Households keeping livestock and poultry
0
10
20
30
40
50
60
70
Poorest Second Third Fourth Richest
Quintile
% h
ou
seh
old
% hh with buffalo
% hh with poultry
%hh with pig
Less income elasticity of resources
Short period for resource adjustment is very long
Slow to catch new opportunities
Can not minimize loss quickly
Fluctuating markets for inputs and outputs
Fluctuating production & natural factors
Higher risks
Lack of insurance or high premium
Poverty in Agriculture Unfavorable price
parityLower productivity
Lower technologyUnfavorable
support and trade policy
Low resource mobility in agriculture
Trade liberalization enhances food security
• Increases rural growth and reduces rural poverty
• Keeps food prices affordable
• Improves access to imported agricultural technology, mostly embedded in inputs
• Provides cash to buy inputs
• Sustained trade reforms can double growth in agricultural sector
Attentions of international communities
• Reform food aid mechanisms: make them quicker and less disruptive
• Improve donor coordination of agriculture, nutrition, and rural development programs
• Pay more attention to closing technology gaps between industrial countries and low income countries
• Reduce industrial country agricultural subsidies• Provide duty free access to LDCs’ products• Simplify SPS/TBT provisions to the exports of
LDCs• Do not put non-tariff barriers to the products of
LDCs
Then What?
• AGDP growth for poverty reduction– Agri intensification & enterprise diversification – Productivity enhancing – Development of secondary and tertiary sector
activities linked to agriculture• Agro-processing enterprises• Storage and preservation• Quality control and certification• Marketing infrastructure and information • Export
• Agricultural growth can reduce poverty if1.Labor intensity does not decline2.Marginal/small farmers can participate in such
growth
Ways Forward1. Labor employment
– Employment opportunities– Productivity through
• productive assets• financial capital• education and skill training
– Wage rate– Transformation of employment structure towards
higher productive sectors2. Targeting
– Self targeted IG programs to poor households– Targeting IG programs to poor regions – Socio-political empowerment of the poor– Emphasize on small infrastructures suitable for the
poor
Hearty welcome to your valuable comments