Agribusiness Promotion Act issued

Kathmandu, November 18

The government has issued the model ‘Agribusiness Promotion Act, 2017’ for the promotion and professionalisation of agriculture by strengthening relations between farmers and agribusiness persons.

The act allows the rural municipalities or municipalities to establish agricultural market in any place of the areas falling under their domain. Similarly, a cooperative of a professional organisation related to agriculture may set up agricultural market by obtaining approval of the concerned local levels.

It has classified the agricultural market into wholesale market, retail market, haat bazar (temporary weekly market) and collection centre. The assembly of the concerned local levels shall fix the fee to be charged for operating such markets.

The act has also provisioned a seven-member Local Agribusiness Promotion Committee led by the chief of the local level.

“The committee shall formulate necessary policies and plans for the promotion of agribusiness at the local levels, and maintain coordination and collaboration with the federal and provincial agencies in this regard,” the Act reads.

One of the most important functions of the committee is to operate Agribusiness Promotion Fund. The fund shall have the amount to be received from the federal and provincial government, rural municipality/municipality, Government of Nepal, and foreign governments, donors and persons. The amount received by the fund shall be deposited in a bank account.

As per the law, the local levels may grant exemptions to agribusiness in export duty while providing subsidy for the use and expansion of technologies (like transport vehicles and machinery) related to agribusiness promotion.

Any bank or financial institution may also extend loans to farmers or agribusiness persons by accepting professional agricultural contract as collateral. “The bank or financial institution may deduct the loan amount extended to the farmer or agribusiness person from the net taxable income of the concerned year payable to the government if the loan so provided could not be recovered,” it reads.

According to the act, the concerned local level may provide land and other physical properties to a person or firm or cooperative to run an agribusiness by concluding a contract between the two parties. “Any person or firm or cooperative willing to run an agribusiness shall get registered with the local level,” it says.

The law has also made a provision of insuring the agricultural products of the concerned farmer or firm or cooperative.