November 8: The Government of Nepal has signed an agreement with the Asian Development Bank (ADB) for investment in the Nuts and Fruits in Hilly Area Project. As per the agreement, the government will bear about USD14.5 million (approximately Rs 1.88 billion) for the project while the ADB will provide a concessional loan of USD60 million (around Rs 7.79 billion) from the Ordinary Capital Resources, a special fund set up by the ADB to extend grants, loans and technical assistance to help reduce poverty in Asia’s poorest countries.

According to the state-owned national news agency of Nepal, RSS, the financing agreement also includes a grant of USD10 million (approximately Rs 1.30 billion) from the Asian Development Fund, and the ADB will administer a USD9 million (around Rs 1.17 billion) grant from the Global Agriculture and Food Security Programme.    

Finance Secretary Krishna Hari Pushkar and ADB’s Country Director for Nepal, Arnaud Cauchois signed the agreement amid a function on Monday.

According to the ADB, the project will increase agricultural income of approximately 40,000 farm households in 100 municipalities in hilly areas of five provinces: Province 1, Bagmati, Gandaki, Karnali and Sudurpashchim. This will be mainly achieved through the development of approximately 10,000 hectares of climate resilient fruit and nut orchards providing value-addition to the nuts and fruits produced by at least 30,000 farm households.

Nepal faces increasing demand for fruits and nuts due to income growth and improved knowledge of nutrition which is not met by domestic production. The commercial farming of fruits and nuts in Nepal remains marginal and the abandonment of cultivable land in hill areas is increasing as people are switching to other off farm employment and relying on external remittances.

"In this context, the project will help in optimal use of the country's favourable agro-climatic conditions to product quality horticulture crops and will support the government's declaration of the Fruit Decade 2016-2026," said Finance Secretary Pushkar.    

Stating that the agreement is a key part of the ADB's overall efforts to address potential risks on food, ADB Country Director for Nepal, Cauchois said, "Through this project we will support improving the livelihood and climate resilience of horticulture farmers in the hilly areas of the five provinces of Nepal."        (With inputs from RSS)