The first cooperatives in Nepal were formed in the Chitwan district as part of a flood relief and resettlement program in the 1950s. These cooperatives were credit societies with unlimited liabilities; in the event of any credit default, the members of the society are jointly liable for its obligations to contribute to any deficiency in the asset of the society. It was not until 1959 when the Nepalese government enacted the first Cooperative Societies Act, as part of government initiatives to use cooperatives as part of its development program. Over the course of seven Five-Year Plans, the Nepalese government embarked on several programs to organize and increase agricultural cooperatives in Nepal. The government controlled the majority of cooperatives in Nepal up until the Cooperative Act of 1992, which provided freedom for the farmers themselves to organize and form their own cooperatives.
A number of successful cooperatives are being run by local communities in Nepal. In particular, Panchakanya Agriculture Cooperative Ltd. uses of organic methods pumpkins, beans, and tomatoes. Panchakanya was loosely formed in 2001 when Uddav Adhikari, who worked as a travel agent in Kathmandu, noticed his clients enquiring about natural and organic foods in the area. Uddav Adhikari decided to introduce organic farming methods to farmers in Kathmandu. He raised awareness about the impacts of pesticide use on soil productivity, the health of farmers, and the nutrition of the produce.
It was not until 2003, that Uddav’s Village Development Committee (VDC) and four surrounding VDCs formally created Panchakanya. Following this, under the leadership of Uddav’s wife, Nirmala, the cooperative became a collective effort of women farmers—something that had never been established before in Nepal. Panchakanya’s mission is “to improve the social and economic well-being of the members by promoting self-help and mutual cooperation.” Today, the cooperative is run exclusively by women. It focuses on promoting organic production by its members and by non-members and other farmers in surrounding villages.
Currently, Panchakanya has a total of thirty-five members but there are many more women are eager to join. The average land holding of each member-farmer is about 0.3 hectares, which is used to grow tomatoes, beans, cucumbers, pumpkins, and other crops. During the winter, when off-season vegetables command a higher price, members focus on peas, potatoes, leafy vegetables, cauliflower, and cabbage.
All of Panchakanya’s members are farming organically and their incomes have also increased. Besides this, the women of Panchakanya have also created a microlending enterprise, whereby each member deposits NPR 100 (US$1.30) per month and loans are made available to buy agricultural inputs and meet household costs. To further develop Panchakanya, members established a village input center to supply seeds and other materials to cooperative members. This has helped prevent member-farmers from purchasing seeds and other materials from sources outside the community, which tend to be more expensive.
Another benefit to the community has been a lower cost for healthcare. The reduced use of pesticides has resulted in less diarrhea and dysentery in the community. Following in the footsteps of Panchakanya, many other cooperatives in Nepal have started replicating their organic approach to farming.