Context
Nepal is undergoing profound political and social transformation. Although its economic potential is promising, this country’s difficult political situation and structural deficits make economic and social integration challenging, in particular for disadvantaged rural communities.
Adopted in September 2015, the new constitution denotes the public, private and cooperative sectors as the three pillars of economic order required to bridge the rural-urban divide. To create an environment that is conducive to socially balanced economic development, the relevant actors in these three sectors must improve their performance. In particular, they need to coordinate their activities, develop appropriate and innovative approaches for business promotion and roll out comprehensive training and service systems.
Objective
Selected value chains and responsible businesses in the focus districts have grown and become more inclusive.
Approach
Inclusive Development of the Economy (INCLUDE) is a joint Nepali-German initiative under Nepal’s Ministry of Land Management, Cooperatives and Poverty Alleviation (MoLCPA). INCLUDE is the anchor programme at the heart of Nepali-German development cooperation in the priority area of sustainable economic development and trade.
INCLUDE aims to:
Design and implement strategies for inclusive growth
Strengthen partners’ access to markets and improve service quality
Develop and promote innovative and inclusive business models
Focusing on the six districts of Banke, Bardia, Dang, Kailali, Pyuthan and Surkhet in the Mid-Western and Far-Western Development Regions, the programme is assisting MoLCPA to strengthen institutional capacity and develop client-centred services.
The main target groups and beneficiaries are poor and ultra-poor people who are or could be economically active, women, marginalised castes, ethnic and religious groups, conflict-affected people and people with disabilities (social inclusion). The programme also targets people in the following selected value chains: honey, medicinal and aromatic plants (MAPs); ginger, fruits and vegetables (in riverbed farming); as well as dairy and tourism. By the end of the current phase, the programme aims to include some 15,000 disadvantaged people in various stages (production, processing and marketing) of the selected value chains, and so enable them to generate additional income of up to EUR 200 per year. INCLUDE also aims to bring the main actors’ (cooperatives and private companies) average turnover into line with the country’s general economic growth rate. In addition, the programme is also supporting the creation of new inclusive and green business models outside the selected value chains to give 1,000 people from the target group the opportunity to earn an additional EUR 200 a year.
INCLUDE is a multi-stakeholder programme. Besides the lead executing agency MoLCPA, other actors include the Nepalese Ministries of Industry; Commerce; Agricultural Development; Livestock Development; Forestry; Culture, Tourism and Civil Aviation; and the Ministry of Federal Affairs and Local Development. Furthermore, the Federation of Nepalese Chambers of Commerce and Industry, the National Cooperative Federation and the District Cooperative Unions are also taking part.
Results
By April 2017, some 14,000 people – 80% of whom belong to the prime target groups – had benefited from the programme. Furthermore, one in two people had managed to increase their income by more than EUR 200 per year.
By strengthening the institutional capacities of key actors and simultaneously building linkages between the public, private and the cooperative sectors, INCLUDE has helped to improve the performance of key institutions required for socially balanced economic development. For example: Guidelines developed by the partner organisations for the purpose of public-private cooperative consultations are now fostering local economic development in the afore-mentioned districts.