Agriculture is the largest economic sector in Nepal contributing to more than one third of GDP (32% - 36%) and employment and livelihood opportunities to more than two thirds of its population (76%). Given that many Nepalese depend on agriculture for their livelihoods, the investment into the development of the sector can make a difference in the lives of millions of people.
The sector, however is largely dominated by the smallholder farmers hence an accelerated growth of agriculture and its multiplier effects will require market oriented production, value addition and equitable distribution of benefits. While opportunities exist, the agricultural sector faces some major challenges such as weak governance, limited capacity and human resources, access to quality input and market access as well as constraints to access suitable financial products and services. Hence, the current competitiveness of Nepal agricultural products is low and declining.