Published by: Nuru
Published date: 25 Jan 2022
Agriculture, Trade, Industry, Services, and other occupations are the sources that drive the economy of the country. Reference notes of Grade 7.
Our country is an agro-based country. The economy of Nepal is dependent upon agriculture. It is the main source of income for Nepalese people. About 80% of Nepalese people are engaged in agriculture.
Agriculture is known as the backbone of the economy of Nepal.
Importance
Agriculture is the basis for human survival on earth. Agriculture has been the highest priority because economic growth is dependent on both increasing the productivity of existing crops and diversifying the agriculture base for use as industrial inputs. Some of the importance of agriculture is given below:
Supply of Food
The agriculture sector provides fodder for livelihood for nearly 35.33 crores people. Food is essential for survival. There should be sufficient production of grains, vegetables, fruits etc. This is only possible through agriculture.
Sources of Income
Agriculture is the premier source of our national income. People are engaged in trade, service, industry, commerce, agriculture etc for their livelihood. More than 80% of people are engaged in agriculture. So, it is the main source of income in Nepal.
Employment
Many people are unemployed in Nepal. They are going abroad for employment opportunities But, agriculture also can provide a lot of employment opportunities in our own motherland. All youth should be motivated to be involved in the agricultural sector to develop the nation.
The process of buying and selling goods and services on a market is known as trade. It is used in our daily life. All the goods and services that we find in our surroundings are the result of trade.
Trade can be classified into two types which are given below:
Internal Trade: The process of exchanging or buying and selling goods and services within the territory of a country is known as internal trade. It is done only inside the nation. For example, apple produced in Humla – Jumla is sold in Kathmandu and other different districts inside the nation.
External Trade: The process of exchanging or buying and selling goods and services to another country or outside the territory of a country is known as external trade. It is done outside the country. For example, the clothes of “Pashmina” made in Nepal are sold to England and other foreign countries.
Importing and exporting takes place in external trade. The process of buying goods from foreign countries is called import and the process of selling goods to foreign countries is called export. Trade is done for the benefit or to earn income by exchanging goods and services.
Trade in the context of Nepal:
Nepal is a least developed or a developing country. The main trade of Nepal is agriculture. But, it is insufficient to earn a better income for the people. Nepal is involved more in importing goods and less in exporting goods. So, it is one of the reasons to be an underdeveloped country.
Being a landlocked country, it has no good access to importing goods. Nepalese trade is limited to India and other countries. Nepal has a good trade relationship with India only. Nepal imports machinery, textiles, electronic goods, petroleum, etc. from foreign countries and exports only agro-goods like paddy, maize, timber, herbs, cardamom, etc.
Diversification
Trade diversification is the process of making the trade relationship good and wider with many countries. It is one of the solutions for the trade deficit of Nepal. Nepal followed the principle of trade diversification since 2013 B.S. At that time, Nepal had started trade with third countries apart from China and India. Now, Nepal has a good trade relationship with many countries like China, India, Germany, the USA, Korea, Japan, and so on.
Benefits of Trade Diversification
There are various advantages of trade diversification. Some of them are given below:
Source of Trade
It is the agricultural sector that feeds the country's trade. Cardamom, tea, sugar, tobacco, etc. are exported to other foreign countries. This amount can be well utilized to import other necessary inputs, raw materials, machinery, and other infrastructures which are otherwise useful for the promotion of the economic development of the country
Source of raw materials
Nepal has many agro-based small and medium scale industries which are based on agriculture. Raw materials required for these industries are obtained from agriculture. For example, sugar mills need sugarcanes, tea estates need tea leaves, rice and flour mills need materials from paddy and wheat.
There are some reasons which are slowing the development work of the nation. Some of them are as follows:
The problem of agriculture can be solved if the Government of Nepal focuses on it. Some of the measures to solve these problems are as follows:
Irrigation Facilities
Irrigation of Nepal is based on the seasonal climate or ‘monsoon’. It is difficult for a water system for irrigation in Nepal. There should be the provision of canals, channels, wells, etc. for the related sectors so that they can do irrigation at any time. The government should provide sufficient facilities and work with the local bodies to develop irrigation in Nepal.
Modern Farming Method
Nepalese farmers use the traditional way of farming, which results in less production in the field of farming. The modern and scientific methods of farming should be used. The farmers should be provided training and modern equipment for sufficient and smooth production. Farmers should be motivated, supported and farming also should be given priority by the government.
Management of Market
There should be a good market for the product or goods. The farmers should get easy access to the market so that they would get a good price for their products. The middleman or brokers should be controlled by the government.
Training
Training programs should be conducted frequently in the country for the farmers by the government and other different district-level organizations/departments. The training help the farmers to generate and update their skills and knowledge. Such training also helps in the modern method of farming.
Provision of loan and materials
Farmers need loans for seeds and fertilizers. The government should provide loans at the low-interest rates for the farmers so that they can easily buy sufficient seeds and farming equipment.
The industry is the home of production of raw materials goods into a final product. The word industry comes from the Latin word "industria", which means "diligence", which reflects the disciplined way of human energy, natural resources, and technology.
The industry is the group of people working in enterprises to form a final product. There are various kinds of industries that produce different products like gold, beverages, steel, textiles, lumber, and other physical items. There are also other industries that provide transportation services to the people like an airline, railway, road, etc., and also other industries that provide food and beverage services like restaurants, hotels, pubs, etc. Industries also may be classified as primary and secondary according to their products and raw materials used.
Importance of Industry
Nepal is an agricultural country. The development of industries is the basis for the development of the whole nation. Without industrial development, there is no progress in the development activities of a nation. There are several sectors of industries that help in the development of a nation like education, health, and communication. There are some significances of industries which are as follows:
Categories of Industries
The industries can be classified into the following on the basis of capital, manpower, and raw materials.
Industrial Estates in Nepal
| Balaju Industrial Estate (2016 BS) |
| Patan Industrial Estate (2020 BS) |
| Dhankuta Industrial Estate (2041 BS) |
| Hetauda Industrial Estate (2020 BS) |
| Bhaktapur Industrial Estate |
| Dharan Industrial Estate (2029 BS) |
| Butwal Industrial Estate (2032 BS) |
| Birendranagar Industrial Estate |
| Nepalgunj Industrial Estate (2030 BS) |
| Pokhara Industrial Estate |
| Rajbiraj Industrial Estate |
According to the Industrial Development Act, 2054, a cottage industry is an industry that can be established by local materials and skills. It can be established with low capital.
Small industries required fixed capital up to 30 million, medium industries required capital from 30 million to 100 million, whereas large industries required capital of more than 100 million.
Some of the large industries of Nepal are given below with their location:
Cement Industry: Hetauda, Udaipur, and Tanahu
Sugar Industry: Birgunj, Biratnagar, Nawalparsi, Bhairahawa, Mahottari, and Sarlahi
Paper Industry: Nawalparasi and Dhanusha
Cotton Textile Industry: Western Terai
Jute Industry: Biratnagar, Dharan
Apart from these industries, there are tea, cigarette, match, leather, and much more industries located in various parts of the nation. Although these industries pay large amounts of tax to the government which helps in the national economy of a nation, there are various kinds of problems. Some of them are as follows:
Tourism Industry
Tourism is another important factor of the Nepalese economy. It is the largest industry in Nepal and also the largest of foreign exchange and revenue. It is creating many opportunities for the people who live in rural places where there are no good roads or no roads. Our natural beauty is also one of the main reasons for the development of tourism.
Every year more than a million tourists come to visit Nepal which directly brings changes to the national economy. A tourist not only gets to enjoy the trip with majestic views of the various peaks but also gets an opportunity to understand the culture, hospitality of Nepalese people, and village life of our country.
A service is a social, economic activity where an intangible exchange of value occurs. Services are intangible and cannot be touched, gripped handled, smelt, tasted, etc. Services are categorized into governmental and non-governmental. They are as follows:
1. Non-Governmental Organizations (NGOs)
A non-governmental organization is a non-profitable organization. It works for the welfare and betterment of the people. It is also a social institution that provides free services to the people at times of necessity. Those people who work for these organizations are known as social workers. All NGOs have the same aim to provide free services to needy people. They provide services like drinking water, free health check-ups, sanitation, women empowerment, awareness programs, etc. to the people. There are many NGOs in our nation. Some of them are Scouts, Nepal Red Cross Society, Aama Samuha, Paropakaar, ABC Nepal, etc. Their services help the government as well.
2. Governmental Organizations (GOs)
Governmental organizations are established to provide facilities and services to their citizens. All the executive and administrative members are referred to be governmental organizations. Some of them are CDO, Education Office, Hospitals, National Banks, Nepal Electricity Authority, Nepal Drinking Water Authority, Court, Post Office, and so on. They help in our day-to-day activities for our easy survival in the nation. They manage all the problems related to a nation and its citizens. It plays a vital role in the development of the nation. It also provides security to its citizen by making different national forces and armies by their own citizen.
Different Occupations
There are different occupations and facilities according to the demands and needs of the people. People are involved in different occupations based on their interests, qualification, and will. Some people are involved in traditional jobs, like agriculture, animal husbandry, farming, beekeeping, etc. whereas other people are involved in offices and modern jobs like in banks, offices, companies, industries, etc. Some earn a large amount of money and some earn less. We respect all sorts of jobs whether they are higher or lower because they are the basis of our survival.