AIC to stockpile seed grains

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KATHMANDU, Feb 22 - Agriculture Inputs Corporation (AIC), a state-owned enterprise, has begun storing additional seeds, with an objective of avoiding possible shortage of seeds during plantation season.

In the first phase of the program, the Corporation has stockpiled 300 tonnes wheat seeds.

Talking to The Kathmandu Post, Nanu Jha, Chief of Seed Division at the AIC, said, "We have initiated this programme so that farmers would not suffer from shortage of seeds, when demand is higher than supply".

The Corporation has earmarked 10 million rupees for this purpose and if the amount suffice, AIC would store the seeds of paddy and maize, the staple crops of the country, in the second phase of their program.

Of the 300 tonnes of wheat seeds, 100 tonnes is stored in Daman and 200 tonnes in Palpa as the places are more appropriate for storing seeds due to their high altitude, which lessens the cost of storage.

The stored seeds of wheat are of improved varieties, of which 200 tonnes is Bhrikuti, 90 tonnes NL-197 and 10 tonnes RR-21. The stored seeds are replaced every two years to ensure better germination and quality of seeds, according to Jha.

Paddy, maize and wheat are the staple crops of the country and farmers often suffer from the shortage of wheat seeds. Since wheat seeds lose their quality in a shorter period, farmers cannot store it for long, which results in dearth of seeds.

Most of the farmers depend on the market for wheat seeds and around 95 per cent of such seeds is of improved varieties. Eighty per cent of the seeds transactions of the Corporation, which sells around 3,000 tonnes of wheat seeds annually, is wheat.

However, farmers exchange paddy seeds among them and the Corporation and other seed dealers have a very negligible role in the transaction of the seeds. So is the case with maize. But they are also using hybrid seeds of maize as well.

This programme is expected to stabilize the supply of seeds, which is the foundation of food security. When there is short supply resultant of low seed collection from pocket sectors, it will meet the demand of the seeds.

The Corporation can supply the stored seeds only with the permission from the National Seed Board.

Though the price of such seeds would not be much different from the regular supplies, its price would be determined by the Board during the time of sale.

Non-iodised salt smuggling on rise

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MAHOTTARI, Feb 22 - The smuggling in of substandard non-iodized salt in the frontier districts of Nepal from India is on the rise, which affects the public health.

The Ministry of Health took initiative to stop the smuggling in of the salt with the help of Home Ministry, but due to laxity of the local administration, such salt is being sold openly.

The reasons behind the growing sale of smuggled inferior salt are lack of awareness among the consumers and high margin in the selling price. Local shopkeepers say that they prefer to sell the illegally imported salt to the domestic one for higher profit.

"There is more profit in selling Indian salt and no one stops us from selling it either," says a shopkeeper of Shankar Chowk, Jaleshwor requesting anonymity.

Mostly, Taj, Tata and Bharat brands of smuggled Indian salts are being sold in the border districts of the southern Nepal, but Tata and Bharat brands are more expensive than the local iodized salt, they sale is negligible. But Taj brand is much cheaper than the local ones.

Narayan Adhikari, coordinator of Consumers’ Forum, Jaleshwor, says due to a lack of awareness among the people about the importance of iodized salt, consumers are attracted towards the cheaper brands.

Hari Nath Shah, a businessman of adjoining town of Sitamadhi in India, says some of the people there simply fill powdered salt in packets and sell with Taj trade mark to the Nepalese businessmen, which have no iodine content. Non-iodized salt not only affects the public health but also the animal health. Subhash Nepal, a local health worker, says the salt is harmful to even animals but neither the Salt Trading Corporation nor any other concerned authority is serious about it.

WTO, WB release book on financial services

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KATHMANDU, Feb 22 - The World Trade Organization (WTO) and the World Bank have jointly released a new book titled "The Internationalization of Financial Services: Issues and Lessons for Developing Countries," which offers a comprehensive review of the benefits and risks of internationalization of financial services.

According to a press release received here today, researchers in the book have highlighted the relationship between capital account liberalization and internationalization of financial services, and the importance of the supporting framework for reaping the gains and minimizing the costs of opening up financial sectors.

The book will be useful for policymakers considering further liberalizing their country’s financial sector in the context of the new round of multilateral negotiations on services, launched by the WTO’s Services Council in February 2000, and for policy makers interested in strengthening financial systems around the world, the release states.

The internationalization of financial services is an important issue for the strengthening and liberalizing of financial systems in developing countries. The elimination of discriminatory treatment between foreign and domestic financial services providers and the removal of barriers to the cross-border provision of financial service, which opens the door to the entry of foreign suppliers, the release says.

According to the release, the main findings, as presented in the book are: Internationalization of financial services helping countries build more robust and efficient financial systems by introducing international practices and standards; by improving the quality, efficiency and breadth of financial services; and by allowing more stable sources of fund. Given the present state of institutional development of many developing countries’ financial systems, these benefits could be substantial.

The extent of the benefits of internationalization depends largely on how it is phased in with other types of financial reform, particularly domestic financial deregulation and capital account liberalization. The experience of the European Union, in particular, shows that internationalization and domestic deregulation can be mutually reinforced, states the release.

The degree of capital account liberalization can determine the potential gains and benefits of internationalization. Internationalization does not, however, require moving to a fully open capital account. Analysis suggests that internationalization of financial services results in less distorted and less volatile capital flows while also promotes financial sector stability, according to the release.

The book includes: case studies focusing on the effects of opening up the financial services sector in various developing countries and transition economies; the motivations for and effects of foreign entry on domestic financial systems; the difference between foreign and domestic financial services; the relationship between internationalization and capital account liberalization; the importance of domestic deregulation and the quality of the institutional framework for the internationalization; the political economy of internationalization; the value to countries of committing to internationalization; the WTO Financial Services Agreement of December 1997, the release concludes.