NRB guv tells banks to insure investments

KATHMANDU, OCT 07 -

Governor of Nepal Rastra Bank Yubaraj Khatiwada said on Friday that risks in investment in agriculture should be addressed through insurance in a bid to assuage bank jitters over its vulnerability to natural hazards.

The central bank has been urging banks and financial institutions to increase lending to the farm sector, but they have been holding back due to fears that disease and natural calamities could wipe them out. The susceptibility of agriculture to these perils is a major reason why the banking sector has been reluctant to put money in the sector.

Speaking at the fifth annual general meeting of the Nepal Agriculture Cooperative Central Federation, Khatiwada also stressed the importance of creating a value chain in agriculture by giving proper attention to the entire cycle from input, production and output to market. “It is necessary to pay attention to production, processing and storage,” he said.

He added that coordination among farm cooperatives was necessary to ensure both backward and forward linkage in the sector. He also stressed that farm cooperatives should concentrate on agro businesses, agriculture services and agro processing. Khatiwada also highlighted the government’s increased priority to agriculture cooperatives. “The government has been providing grants to cooperatives engaged in agro business including livestock farming and bio-gas production, among others,” he said.  

Meanwhile, Ekraj Upreti, secretary of the Nepal Agriculture Cooperative Central Federation, said the sector had been suffering from lack of infrastructure including irrigation and market. “In addition, lack of timely availability of fertilisers and improved seeds has also hit the agro business hard,” he added.

Source: The Kathmandu Post