Nepal’s Agriculture Budget: More Money for Fertiliser, But Where Is the Long-Term Plan?
Nepal is spending billions on imported fertiliser while domestic value chains, farmer protection and alternative agricultural inputs remain underdeveloped. The bigger question is whether this budget is building a stronger agricultural economy or simply managing Nepal’s dependence on imports.
Nepal's annual budget announcement often brings a mix of anticipation and scrutiny, especially within a sector as important as agriculture. This year, however, the numbers raise a more fundamental question: what kind of agricultural system is Nepal actually building? For fiscal year 2083/84, the government has allocated Rs 46.92 billion for agriculture and livestock development, while Rs 32.46 billion has been allocated for chemical fertiliser. That means roughly 69 percent of the agriculture and livestock allocation is going toward fertiliser. [Source: Ministry of Finance, Government of Nepal; Kantipur] There is a practical reason for this priority. Nepal has struggled with fertiliser shortages for years, and farmers cannot wait for procurement systems to catch up with the planting season. This year, Nepal also turned to India for emergency fertiliser supplies after global disruptions and rising prices put pressure on its farm input system. [Source: The Kathmandu Post] But solving an immediate shortage by repeatedly increasing spending on imported inputs does not necessarily solve the larger structural problem. It may simply make the country better at managing its dependence.
The Cost of Imported Inputs: A Vulnerability We Keep Repeating
Nepal's dependence on imported fertiliser is not just an economic issue. It is also a supply chain risk. When international prices rise, shipping routes are disrupted or geopolitical tensions affect production, Nepal feels the impact almost immediately. Farmers need fertiliser at a particular time, but Nepal has limited control over the international market from which that fertiliser comes. The issue is not that chemical fertiliser should disappear. Nepal's farmers need it, and shortages can directly affect yields. The problem is that fertiliser policy has largely remained focused on securing enough imported chemical inputs for the next planting season rather than building a system that gradually reduces vulnerability.
The new budget does include some longer-term measures, including a plan to establish a green urea industry and Rs 360 million in conditional grants to local governments for the promotion of organic fertiliser and green manure. [Source: Ministry of Finance, Government of Nepal] But the difference in scale is difficult to ignore. Against Rs 32.46 billion for chemical fertiliser, only Rs 360 million is allocated for organic fertiliser and green manure promotion. The question, therefore, is not whether Nepal should stop using chemical fertiliser. It is whether enough investment is being made in the alternatives
