Livelihoods Connect Policy, Institutions and Processes Sub-Group: HARP Paper

Hill Agricultural Research Project (HARP) Nepal - Lessons for the Policy, Institutions and Processes Dimensions of the Sustainable Livelihoods Approach: Karim Hussein (ODI) and Sarah Montagu (DFID)

2. Livelihoods Context and Summary Data: Nepal

Background
Agricultural services in Nepal are faced with a complex context that conditions and shapes the effectiveness of their work and the options that can be taken in trying to promote agricultural development. Some aspects of the context are summarised below.

People and Population
According to current estimates, about 22 million people live in Nepal in 75 districts. The highest concentration of people live in the Kathmandu Valley and over 90% of the population is rural. Nepal is a very heterogeneous society with a complex ethnic mix. This heterogeneity is overlaid by great disparities in social and economic opportunities. The poor and very poor are located predominantly in the mountains and very remote areas, in the mid and far west districts and also dispersed throughout rural areas. Causes of poverty are diverse.

Poverty and Vulnerability
According to the 1996 Nepal Living Standards Survey, 42% of Nepal's population lives under the poverty line - and the poorest live in the remotest areas. Rural populations are vulnerable to natural calamities such as floods, landslides, soil erosion and the particularly harsh environment of the mountain regions; in addition the escalating civil conflict due to Maoist insurgency is disrupting livelihoods in poorer, remoter rural districts.

Human Capital
Human capital is weak, indicated by: average national illiteracy rate of 64% (twice as high in rural as in urban areas); high infant, child and maternal mortality and malnutrition: nearly 50% of young children are underweight and have stunted growth.

Natural Capital
Access to adequate natural capital - land, water and common property resources - is constrained:

less than 20% of rural households are landless, but land fragmentation, dual ownership and size (2/3 of landholdings are less than 1ha) hinder productivity;
water is abundant, but access to drinking and irrigation water is unequal, only 44% of the population has access to safe, clean water and the physical infrastructure that exists has been poorly managed;
forest resources are critical, supplying 90% of total fuel, 50% of livestock fodder and potentially highly valuable non-timber forest products (e.g. medicinal herbs);
about 45 out 75 districts in the country are in food deficit and of these, about 13 mountain and hill districts have less than 6 months' food sufficiency most years.

Physical Access
This remains a serious constraint to the 14 districts without roads and in the context of a challenging mountainous environment where many settlements may only be accessible by several days' walk. Lack of roads also poses significant problems for farmers to access markets for the purchase of essentials and sale of produce. Few have access to sanitation or electricity.

Financial Capital
Access to financial capital through formal channels is restricted to 15% of borrowers, owing to limitations in the capacity of institutions to deliver services to the rural poor and the wider policy environment. However, pensions and remittances are important sources of financial capital.

Political Leadership and Instability
The continuing lack / instability of political leadership and weak commitment to change creates a difficult policy environment.

Patronage
Political patronage, afno manche (one's own people) and associated inequities in gender, caste, ethnicity and age limit access to resources and opportunities. Social capital, networks and trust as well as user groups are essential to people's livelihood strategies.

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Caste
There are at least four different caste groups and 36 different ethnic groups in Nepal. Indisputably, caste is an important issue in gaining rights to resources. Policy-making posts in Government or NGOs and international organisations tend to be held by people from relatively wealthy, high caste backgrounds from the Kathmandu area. Scheduled castes (or dalits), who constitute some 20-25% of the population, have little access to resources education and to influential posts.

Tenant Farmers
Through the addia system, tenant farmers have limited rights to control natural resources. Under this regime, tenants must usually give half of their production to the owner of the land as rent. These tend not to make enough surplus to cover the use of inputs and hence are the least interested in new technologies that require inputs. Research and extension therefore have difficulty in working with this group.

Bonded Labour
Despite being illegal, bonded labour, or kamaiya, is a form of virtual slavery that has been especially prevalent in western regions of Nepal. Essentially, in return for a what is usually a small loan, farmers have had to repay interest to landlords by living and working on the landlord's land. The landlord provides a share of food crops. The capital is rarely repaid and hence labourers are in reality frequently "bonded" to their creditor indefinitely. This bond can be inherited and so does not end upon the death of one generation. While often being very poor, bonded labourers have not usually do possessed their own land; hence it has not been easy to directly target agricultural services to them. In July 2000, the government proposed legislation to "free" all bonded labourers and is now in the process of establishing a resettlement scheme for them - providing small plots of land to the many that have already left the employment of their landlords. However, confusion remains as to who will be liable to pay remaining debts. The changing situation should permit agricultural services to identify more opportunities to involve them in development-oriented research and technology generation processes (see section 8 - case study).

Gender

Men outnumber women in urban areas. This pattern is influenced by the bias in employment and education that favour men, resulting in large male out migration from rural to urban areas. Nepal also has had a long history of male emigration with regional variation;
40.4 % of women and 59.6 % of men over the age of 10 are considered economically active. This indicates a lower participation by women as compared to men. This is due to the fact that activities such as weeding and harvesting, kitchen gardening, livestock, poultry rearing, and fuel and water collection, which are almost exclusively performed by women, are not considered as economic activities and hence excluded from surveys;
Sometimes only men participate in user groups set up for women as they are the only ones with the time;
The literacy rate for women is only 25 % and this compares with 54.5% for men.

Development Achievements Over Last Two Decades
Despite these statistics, many improvements have been observed over recent years showing development interventions to be having some significant impact:

increased access to drinking water;
improved communications and more access to electricity supply;
life expectancy increasing to 57 years · the advent of democracy after the 1990 people's uprising against autocratic rule.

(Much of this section is adapted from data collated by DFID-Nepal - with permission. See also section on Sources for further information)

		Contents:
		Summary
1		Relevance of the Study to Sustainable Livelihoods
2		Livelihoods Context and Summary Data: Nepal
3		Political Setting
4		Macro-Economic Policy and Agricultural Policy Context
5		DFID Policy and Approach to Development Assistance in Nepal
6		The Nepal Agricultural Research Council (NARC)
7		HARP - The Project and the Process
8		HRP - Funded Project Case Study: Combined Rice-Fish Farming in the Hills
9		Emerging Issues: How Does the Political and Institutional Setting Influence the Achievement of SL Objectives
10		Key Sources and Further Reading
		Annex 1: HARP Timeline and Process
		Annex 2: Programme for Nepal Visit
		Acronyms
		Research Biodata