United Nations
Information Centre | Nepal
Challenges and Opportunities for Nepal’s Small and Medium Forest Enterprises (SMFEs)
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This report is part of a cross-country research initiative that focuses on small and medium forest enterprises (SMFEs) and their potential to contribute to poverty reduction and sustainability. It is based on a scoping study designed to gather background information, present key issues, and identify research priorities. The study was coordinated and implemented in Nepal by ANSAB, in collaboration with FAO. This report builds on the findings of earlier ANSAB research and intends to synthesize the learning of different Nepalese stakeholders. SMFEs have traditionally served as a means of sustaining rural livelihood in Nepal. Most of the rural people, especially in the hills, depend on the collection of non-timber forest products (NTFPs) to sustain their livelihood. SMFEs are being established to help reduce poverty through employment generation, both through self-initiation of local communities and through technical and financial support from government agencies, bilateral and multilateral projects. The majority of SMFEs are associated with community
forest user groups (CFUGs) that are formed under Nepal’s three decades of community forestry program. At present, there are over 15 000 CFUGs and approximately one third of the population is participating in the management of 21 percent of the country’s forest area (CPFD, 2006). In addition to NTFP-based SMFEs, wood-based enterprises, such as furniture making and agricultural tool manufacturing, and wood depots are also increasing in local market centers.
The SMFEs sector has the potential for rapid growth in Nepal’s industrial sector. For instance, the Tenth Five-Year Plan (2002–2007) recognized the potential for sustainable use and management of forest resources for poverty alleviation, especially through the promotion of forest-based micro and small enterprises. More broadly, micro, small and medium enterprises (MSMEs) account for 70–80 percent of the total value of Nepal’s industrial production, 80 percent of the employment, and 70 percent of the value of all exports. These enterprises create local jobs and support the establishment of new industries in rural areas. In this study, we have compiled and presented information on some of the major SMFEs in Nepal. We have also presented a diagnosis of five major traded NTFPs i.e. Lokta (Daphne species), Jatamansi (Nardostachys grandiflora), Chiraito (Swertia chirayita), Kurilo (Asparagus racemosus) and Wintergreen (Gaultheria fragrantissima), and a timber species of Sissoo (Dalbergia sissoo). These six species and their products are the ones that are
commonly traded or cultivated. Through that we have attempted to reflect the status of the sector in general and the connectedness of SMFEs to markets, service providers and policy processes. Of the six products, Kurilo occurs in tropical and subtropical regions, and its root is used in Ayurvedic medicine for its tonic and galactogogue properties. It occurs in natural, government-owned forests and is also increasingly cultivated in private and community
lands for commercial purposes. About 60 to 200 tonnes of Kurilo are collected annually from Nepal and sold semi-processed in the Indian market (boiling and drying). Only a few Ayurvedic companies use Kurilo as their raw material; the main bulk is exported and the market price is increasing. Similarly, Chiraito occurs in subtropical and temperate regions of Nepal, and the whole plant is used as an antipyretic and bitter agent in beverages. In eastern Nepal,Chiraito is being massively cultivated and exported, mainly to India, and a small percentage to Tibet. Contrary to price trends since the 1990s, its price has steadily declined since 2003.
#Forest #NaturalResources
ANSAB, FC, FAO ,   (2009 )
Type / Script:
Progress Report in English
Thematic Group:
 FAO : Food and Agriculture Organization
04.05.00  -  Forestry
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