Siddarth Khadka from CASA Nepal reflects on the opportunities created by the Nepal Investment Meeting in Kathmandu at the end of 2022. The event provided inspiration, but the hard work starts now to ensure the priorities identified help create a more conducive investment environment for agribusinesses in Nepal.
Getting over 100 people together to talk about investment in agri-food SMEs in Nepal in December, was a great step forward. Feedback from delegates emphasized the need for good communication to help the stakeholders work together to bring about sustainable change in Nepali agriculture investment.
CASA is having interesting conversations on how to address the systemic challenges and bottlenecks that are holding back agri-food sector investment in Nepal. Our event partners, Federation of Nepalese Chambers of Commerce and Industry (FNCCI) and the Ministry of Agriculture, will be critical to delivering sustainable change.
I know change will not happen overnight. CASA’s work to make agri-SMEs in the vegetable and dairy value chains investment-ready has taken two-three years. This highlights the challenges of creating a pipeline of investable business.
The CASA team worked hard to consult with investors ahead of the Investment Meeting. These interviews dictated the theme and discussion points for the breakout groups. During the breakout groups, delegates outlined the main priorities for action, that were chosen through a smartphone poll.
The priorities that emerged were:
• Improve awareness of current government policies. Further, facilitate discussions on how these policies could be further improved. This is to support sustainable investment in the agri-food sector in Nepal
• Align priority value chains for government with those seen as profitable areas for the private sector
• Segment the agricultural loan portfolio mandated by the central bank. Making a distinction between interest rates for production and for trading
• Support agri-SMEs to understand the importance of technical assistance. This is so they are willing to pay for it. This then creates a sustainable market for business development services
CASA also took six investment houses to see two businesses that we felt were investment ready. These visits generated a lot of interest. However, process also reinforced the value of merging technical assistance/business development services and brokering access to debt and equity investment.
I see this as an area where CASA can add value. This can be done by using its convening power, networks, knowledge, and research to create new investment pathways. This is especially for SMEs sourcing from smallholders.
The resilience of the value chains in Nepal was tested from the outset of CASA. First, by the Covid pandemic, then, to a lesser extent the cost-of-living crisis. In response, we focused on short-term relief and long-term solutions that build resilience.
Surprisingly, climate adaptation was not seen as a high priority topic by participants at the investment meeting. This is an area CASA will keep under reviews as it seeks to build resilience along the value chains from farmer to processor.
CASA is currently looking at investment opportunities associate with food loss reduction in value chains. This is one way that the climate challenge can be mitigated and additional resilience can be brought to food supply systems.
Feedback from Investment Meeting
We asked participants at the event what could be improved. Feedback suggested that farmers, politicians and some key agencies should have been included. This would have led to a very different event, with perhaps less emphasis on investors. However this is something we will reflect on this before our next event.
One suggestion was to give investors more time to speak in the full panel sessions. A second suggestion was that overall, delegates need to be pushed for more statements about solutions and spend less time restating the problems.
A lot of the feedback focused on the next steps. Ideas emphasized on sharing the findings and building the necessary partnerships to make change happen. There was also a feeling that the event proved the value of dialogue. More conversations should be planned, with different panelists. There was appreciation that breaks allowed one-on-one conversations and further discussion on deals.
More broadly, the feedback emphasizes the need for technical assistance and advisory support to build capacity in the sector. Especially outside of the Kathmandu area.
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More information on the Nepal Agriculture Investment Meeting:https://www.casaprogramme.com/event/nepal-agriculture-investment-meeting/