A Study on Recent Trends of Organic Products in Developing Economy of Nepal
1. Problem Statement
2. Research Methodology
3.1 Data Collection
3.2 Data Analysis
3. Literature Review
3.1. Exploring recent trends of organic farming and its impact on Nepal’s economy
3.2. Response of the customers or consumers of organic farming.
4. Research Methodology
The topic of this proposal suggests a research-based study with two variables. First is the impact of organic farming on the economy of Nepal. The second is the consumer’s response on green marketing. Both of which are inter-related. This project proposal explores the dimensions of organic farming and provides resolution to the research question pertaining the title.
A Statement of The Problem:
The term “Green Marketing” is defined as, “endorsing environment friendly products or services which promote sustainable outcomes (Ward, 2020). One of the main issues is the rising concern of the cost involved with the implementation of “Green Marketing”. Following the green marketing adaption, inclination towards organic products has increased as learning the health benefits has pushed consumers to invest for it. However, the production of food has dropped due to the high use of fertilizers and also due to attraction towards the commercial production of crops. In order to produce in quality, the traditional and quality has been neglected (Adhikari, 2018; Acharya et al, 2017).
With a rising level of pollution in Kathmandu, the crops are being affected as well as investment on insecticides and pesticides are levelling up using is harming the natural surrounding (Bhandari, n.d.). The dependency of the economy of Nepal on it’s agricultural or other environmental resources displays the country’s determination towards a green and sustainable future (Bhuju et al, 2014). With the rising of various issue in the environment, Nepal is focusing on management practices and exploring different ways in meeting the demands of the consumer in a more sustainable fashion.
For directing Nepal’s economy to a meaningfully progressive state there is a need to implement concept of green marketing with the help of budding business volunteers (Joshi & NiranjanDevkota, 2019). Though, consumers do not exhibit clear understanding of green evolution and how it can help in attaining sustainable outcomes (Shrestha, 2016). Customer satisfaction is the key to identify the quality of the product (Baktash & Talib, 2019).
Research Aim & Objectives:
The main objective for conducting this research proposal is to analyze the growing need of organic products and its usefulness in achieving sustainable goals in the impending economy of Nepal. The study will expand the understanding how agriculture and consumption of organic products produced could of great benefit in improvising the quality of life of Nepalese people. The objectives for this research are:
1. To investigate how organic products are being marketed in Nepal
2. To evaluate consumers’ response to the consumption of organic products.
3. To explore the impact of marketing of organic products on the economy of Nepal.
Secondary data has been used in this research proposal. The collection of data is done through different resources such as website articles, based on research on Nepalese businesses which deals in procuring organic products and selling them. The following are the research questions which this proposal aims to answer:
1. How organic products are being marketed in Nepal?
2. What is the consumer’s response to the consumption of the organic products?
3. How can the challenges faced by organic sector and its consumers be resolved by effective marketing strategies?
Exploring recent trends of organic farming and its impact on Nepal’s economy
The organic farming impacts the social as well as healthy aspects of the life of people and ensures their over-all wellbeing and by maintaining the ecological balance. It is also vital for sustainability as it helps to provide conservation of natural resources. The role of government, non-government, private segments, the farmers as well as the consumers are crucial stakeholders the sustainability of organic farming or organic agriculture (Kumar, 2020).
Nepal experiences high profits by exporting organic products such as tea, honey, large cardamom, coffee as well as organic ginger and certain medicinal herbs, which specifically grow in the Himalayan region and therefore is an asset for the Nepal’s economy. The international market of Nepal’s organic products has significantly expanded after it became a part of WTO (World Trade Organization) (Pant, 2006) and after the passing of the bill for “National Standards of Organic Agriculture Production and Processing”. It has also collaborated under CertAII for organic labelling regulations. With all these accolades, Nepal’s domestic market for organic products is also exponentially risen with the price of these products ranging between 10%-200% more than it’s actual cost.
Other markets such as local organic bazaars, various supermarkets, retail outlets, internet marketing and direct selling of organic products is thriving are a Signiant revenue generator for the economy of Nepal. describes the link between family farming for achieving sustainability. In his research, the term “family farming” is highlighted theme for rising of the family economic as well as social status. Work force within the family is far more superior than the hired labourers and is noticed to produce plenty of quality harvest (Mamgain, 2019). Such method or the technique of farming has established a possibility for not only producing jobs opportunities and generation of income in the rural areas but has also led the consumers and other stakeholders in the path of sustainable development.
This type of farming should be encouraged in Nepal due to its geographical asset of producing plenty of organic harvest without using commercial methods of agriculture or using any other industrialized farming techniques. It can be cost effective and used for upliftment of the rural population in Nepal, integrating them as an important contributor toward the economy of Nepal instead of letting them being a burden.
A number of researches point towards the fact that organic agriculture can be used as a vehicle for eradication of poverty. Furthermore, an empirical research favors that there is a positive link or association between organic farming, security related to food and reduction of the ratio of poor population in the context of emerging economies (Devkota et al, 2017) In 2002, The Food and Agriculture Organization (FAO) generated a long and wide report for understanding the potential of organic farming in providing food security. It concluded that organics is a positive strategy not only for trade, but for sustenance farmers attempting to meet family food necessities and perhaps sell surplus in local markets.
Conducted an elaborated research regarding the potential of organic farming and its contribution for providing food security. The research deduces that “going organic” is quite an enterprising idea not alone for the purpose of trade, but also, for the farmers who are searching for means to survive and sustain the needs of their families in respect to the provision of food (Bhandari, n.d). They can also contribute their share in the economy by selling their natural produce in surplus in the local markets of Nepal. Various developing countries are also conduction researches which help them to reduce the costs involved in the organic systems.
Mainly two types of crops, the organic maize and organic coffee, did not show positive results in the market in terms of profits (Lamsal, Pant & Bhatta, 2014). However, the profit generated was found to be more in maize and coffee as compared to traditional sold coffees. From the universal point of view, it can be seen that the tradional crops are more expensive than to produce than organics. Organic farming may face many political hurdles based on the amount of cost involved and funding required from the government.
On this note, technological options for instance, suitable variety of seeds, use of bio-fertilizers, vermi-compost, and improved farm yard manure will prove to be helpful in boosting productivity in organic farming. Increasing the value or price premiums is also the solution for improving economic status of the organic farming in Nepal (Paudel, 2016; Singh & Maharjan, 2017; Shrestha, 2016 ). The share of Nepal in Organic agricultural land is only 0.12% in South East Asia.
On the other hand, according to various studies, it has been deduced that even without increasing in the price premiums, farmers are adopting organic farming practices in order to save costs and attain feasible outcomes. The conceptual idea of sustainable organic farming illustrates an interrelationship between diverse factors which play a vital role in sustaining organic farming. As per the research, any new technology which is introduces in the society goes through first, a process of testing, and rejection before it is widely or openly accepted in the market. Therefore, different marketing strategies should also be explored to enhance the sales output of the organic products.
Response of the customers or consumers of organic farming
Consumers buy expensive branded products instead of local supply chain markets in Nepal. This is because the organic products manufactured in Nepal are not as popular as manufactured in other countries. Examples of such products are- Organic Tea Green Tea; Good Earth; Organic Kitchen, etc. Consumers should give the first priority to purchase the pure Nepalese organic products and must involve in the broadcasting information and knowledge of organic products as an effective marketing strategy also termed as “word of mouth’. Consumers must be made aware of the benefit of organic farming in terms of improving their health as well as using it as a driver for benefiting the socio-economic status of people (Banjara & Poudel, 2016; Khanna, & Tripathee, 2018).
Mainly two types of crops, organic maize and coffee, have known to show negative profits in both conventional and organic systems. It accounts for 60% of the GDP of the country which is higher than most of the countries in the world. Nearly 75% of the organic Nepalese are exported However, the profit generated was found to be more in organic maize and coffee as compared to their traditional counterparts because of lower costs (Babu & Sah, 2019). From the universal point of view, it can be seen that the conventional crops are more expensive than to produce than organics. In respect to the sustainability aspect of organic farming, numerous researches have concluded that there are many different ways and techniques to attain sustainability.
In one of the recently published book of a Japanese philosopher Osamu Soda, he describes sustainability as a “process of growing total wellbeing or appreciating complete values.” The book is named, “Philosophy of Agricultural Science.” This idea offers an equilibrium of different value systems such as ecological, economic, as well as values of a sustainable life. The resolution of the challenges posed in the manufacturing of the organic products lies with the local farmers, researchers and the governmental policymakers.
It will be difficult for the, nations, the local communities, and the individuals to make difficult decisions regarding the manufacturing of the methods in organic farming (Ghimire, 2019; Bhuju et al, 2014). Marketing lays a vital role in impacting the consumers. The organic products should be sold in a more lucrative manner. More enterprising schemes should be implemented in order to promote locally agriculture. Organic agriculture is also a way of family farming. It leads to increase in employment opportunities and promotes further manufacturing of organic products and economic growth (Pokhrel & Pant, 2009).
Data Collection: The data is based on more than 20 authentic journal articles, a majority of those were sourced from the country Nepal itself. Exploratory strategy or methodology was incorporated to have a deep understanding of the organic farming from the perspective of consumer as well as the business point of view. The sources include primarily the reliable government websites of Nepal.
Data Analysis: It is the qualitative analysis which reveals there is a direct relationship between the marketing trends in organic farming and the economy of Nepal. It accounts for 60% of the GDP of the country which is higher than most of the countries in the world. Nearly 75% of the organic Nepalese are exported, pushing the economical profits to a great extent (Dahal et al, 2016).
Conclusion: The study establishes valid relationship between marketing of organic products and the economy of Nepal. The study answers the research question by revealing a relationship between the aforesaid variables. It signifies the importance of organic farming and its scope in the future of Nepal’s economic status. There have also been some limitations in the proposed project, such as the analysis of the study is based on the last 10 years of journals and articles, this results in a decreased impact of the study. The review of literature from English peer reviewed journals and articles, hence, other potential sources of strong evidence of literature which are in various languages cannot be included. Conclusive study of the data reflects that effective sales and marketing strategies and exploring business ideas such as family farming; multi-level-selling, new branding, can improve the sales of organic farming, thereby, encouraging sustainable outcomes for the consumers and sustainable growth of the economy.
Adhikari, S. (November, 2018). Organic Farming Booming In Nepal. New Business Age. https://newbusinessage.com/Articles/view/2430
Acharya, A. K., Joshi, B. K., Gauchan, D., & Poudel, Y. P. (2017). Chapter V. Associated Biodiversity for Food and Agriculture in Nepal. The State of Nepal’s Biodiversity for Food and Agriculture, 60.
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Bhandari, R. (n.d.) Green Economy- The Way Forward. The Rising Nepal. http://therisingnepal.org.np/news/111
Babu, S. C., & Sah, R. P. (2019). Agricultural research and extension system in Nepal: An organizational review. In Agricultural Transformation in Nepal (pp. 291-319). Springer, Singapore.
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