Agriculture Innovation & Its

Impact in Commercialization

Basudev Sharma
M.Sc.Ag. (Agribusiness Management)
1 st S e m e s t e r
H I C A S T, K a t h m a n d u
2 9 th J u l y 2 0 1 7
 Presentation Outline
Present Situation of Nepalese Agriculture
Agriculture Priorities
Challenges and Gaps
Innovation Concept
Agriculture Innovation
Technology Movement
Elements of Innovation
Objectives of the Agriculture Innovation System
Commercialization via Innovation
Agriculture Innovation System
Barriers to Innovation
NABIC (Nepal Agribusiness Innovation Center)
Conclusions
References
 Present Situation of Nepalese Agriculture
Agriculture contributes 32.12% to the Nepals
GDP, employs about two thirds of the workforce
and more than 50 % of export depend on
agriculture.
Small, extremely diverse and landlocked
Its topography determines that only less than
20% of its land is cultivable.
Main source of food, income and employment
for the great majority of the population (65.7%)
 Present Situation of Nepalese Agriculture
Monsoon dependent, under developed
Subsistence and mixed farming system with
domination of small holder farmers (about
60% farmers), Conventional Farming
Low level of public and private investment
Suffered massively from natural calamities;
floods, land slides, cold weather, drought and
earthquakes
Fast growth in some high value commodities:
vegetables, spices, dairy, poultry, fish etc
 Present Situation of Nepalese Agriculture
Dominated by food grains (>one third),
followed by livestock (one fourth) and cash
crops.
Due to the traditional farming system and
small size of landholding, labor productivity is
low.
Frustrated with low labor productivity and
living standard in agriculture, the labor force is
shifting from agriculture to non-agricultural
sectors.
Migration from farm to urban centers and
foreign countries is getting popular.
 Agriculture Priorities
Increasing production and productivity of key
agricultural crops
Promoting agriculture commercialization and
modernization for increased efficiency and
farm income
Addressing both food and nutrition security
Local economic development through
agribusiness cluster development
Alleviating poverty through smallholder
agriculture development
 Challenges and Gaps
Develop the key institutions and instruments
for policy implementation
Increase factor productivity
Expand the commercialization of agriculture
based on high-value crops
Improve the enabling environment for private
sector development
Strengthen the partnership approach
Improve cross-sectoral interaction
 Innovation Concept
The process of creating and putting into use
combinations of knowledge from many different
sources
This knowledge may be brand-new, but usually it
is new combinations of existing knowledge.
Process of constant learning and adaptation
For an invention to become an innovation, it has
to be used by farmers
Process by which social actors create value from
knowledge.
Innovation leads to things being done differently
in unpredictable ways.
 Agriculture Innovation
Agricultural innovation is an understanding of
how a countrys agricultural sector can make
better use of new knowledge and design
interventions that go beyond research
investments.
It is collaborative arrangement bringing together
several organizations working towards
technological, managerial, organizational and
institutional objectives.
Innovation is a major source of improved
productivity, competitiveness, and economic
growth throughout advanced and emerging
economies, and plays an important role in
creating jobs, generating income, alleviating
poverty, and driving social development.
 Technology Movement
Production system approach to Farming system
Farming system to farmers first and
participatory approaches
Participatory to Agriculture Knowledge &
Innovation System (AKIS) approach
AKIS approach to Innovation approach
 Elements of Innovation
Innovation capacity can be collective and
individual and has four elements
1. Individual and organizational expertise
2. Attitudes and routines developed through
training and trial & error
3. Communication and networks that allow
individuals and organizations to access a
wide array of ideas and expertise for
innovation
4. Policy environment and the way its shapes
the first three elements of capacity
Objectives of the Agriculture Innovation System
To support the small & medium enterprises
(SMEs) in their capacity development
To contribute for commercialization and
industrialization of the agribusiness sector
To foster collaboration among ecosystem actors
in promoting agribusinesses
To make analysis of the solutions to the
problems on agribusiness and help to get
healthy decisions
 Commercialization via Innovation
a) Generation of more marketable surplus in
subsistence oriented food grain crops
b) Increasing production of market oriented
commercial crops and other products
(collectively known as high value adding
enterprises)
c) Increase in food grain production through
improvement in productivity of land and
diverting area for the high value adding crops
or other enterprises will ensure food security
and commercialization simultaneously
 Agriculture Innovation System

Exporters Research
Agro System
Processers
Producer Producers
Organizations Farmers
Input
Suppliers Advisory
Education
Service
Credit System
System
Agencies
Land
Agencies

Government Policy & Regulatory Framework

 Barriers to Innovation

Linkage
Culture
Policy & Knowledge
Adverse
Bureaucracy Deficiency
Market
Condition
Capacity
Resources
Lack of
Attitude and Incentives
Behavior

Risk

Infrastructure
 NABIC
(Nepal Agribusiness Innovation Center)

Supported by: PACT, MoAD

Funding Agency: World Bank Group
Technical Assistance: InfoDev
Executed by: Practical Action Nepal
Executing Partner: School of Management, KU
 NABIC Service Portfolio
Mentoring and Business Advisory Services
Management and Business Consultancy
Marketing and Market Access
Facilitation of Access to Financing and
Investments
Access to Technology
Office Space, Facilities and Services
Networking and information
 Business Incubation Services
Pre-incubation: Services for entrepreneurs to translate their
product ideas into demo products, product testing, market
research and validation, development of a business plan and
entrepreneurship training. This will be a cohort based program
with duration of 4 months.
Incubation: Structured incubation program with wide-range of
services to support growth of emerging high potential agri-
enterprises. The incubation program duration will last a
minimum of 12 months. This program will also run on a cohort
basis.
Intensive incubation: Holistic business services that support
business development of high performing agri-enterprises to
take them to a new growth trajectory. This program will also
require engagement for a minimum of 12 months. This
program will admit clients on a rolling basis.
 Conclusions
Knowledge created by research is a fundamental building block
of an innovation system.
The context of agriculture is continuously evolving.
The need to integrate social and environmental concerns can be
viewed in various ways.
Even when competitive incentives to innovate are very strong,
they are not always sufficient to bring together all of the actors
needed for innovation to function or to reach sufficient scale.
Dynamic and coordinated interaction among actors in an
innovation system often is frustrated by a range of deeply
entrenched attitudes and practices that originated when
research through a linear process of technology transfer was
seen as the main driver of innovation, or when the main source
of competitiveness was considered to be low cost (rather than
innovation).
 Conclusions
The organization of rural stakeholders is a common
element of value chain approaches and community-
driven development.
Innovation systems depend on intermediary
organizations to facilitate interaction or access to
technology and information, and they also depend on
coordinating bodies to help integrate the activity of
different actors in a sector.
Interaction is only one (albeit important) practice to
promote innovation.
The innovation systems concept pays attention to the
enabling environment as an important promoter of
innovation capacity.
 References
The World Bank, Agricultural Innovation Systems, AN INVESTMENT
SOURCEBOOK

The World Bank, 2013, PROMOTING AGRIBUSINESS INNOVATION IN

NEPAL: Feasibility Assessment for an Agribusiness Innovation Center.
2013. infoDev, Finance and Private Sector Development Department.
Washington, DC: World Bank.

The World Bank, Enhancing Agricultural Innovation: How to Go Beyond

the Strengthening of Research Systems, Agriculture & Rural Development
(ARD)

http://siteresources.worldbank.org/INTARD/Resources/Enhancing_Ag_In
novation.pdf

https://www.infodev.org/infodev-
files/promoting_agribusiness_innovation_in_nepal_-_full_study.pdf

http://www.infodev.org/press-releases/world-bank-group-launches-new-
center-promote-agribusiness-nepal
 References
http://pact.gov.np/?option=publication&page=publication_type
&publication_type=Agri-
Business%20Innovation%20Center%20(AIC)%20Nepal%20Report
http://www.infodev.org/articles/infodev-captures-growing-
interest-agribusiness-nepal
http://www.nabic.agribiznepal.com/index.php
https://www.infodev.org/infodev-
files/m1_traineemanual_20101029.pdf
http://www.ukspa.org.uk/sites/default/files/factsheet%201%20-
%20A%20Brief%20Introduction%20to%20Business%20Incubatio
n.pdf
http://www.netfund.go.ke/images/2016/April/The-Effect-of-
Business-Incubation-in-Developing-Countries.pdf
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