About Us
Nepal is an agricultural country. Agriculture is the most important sector in terms of income and employment generation Agricultural sector accounts for about 27 percent of national GDP. About 65 percent of total population derive it’s livelihood from agriculture and unallied activities. Krishi Samagri Company Limited (KSCL) was established in 1965 as a public sector enterprise to procure and distribute high quality and improved agricultural inputs (fertilizers, seeds, agro-chemicals and implements) at a reasonable price across the country.

Initially, AIC was named Agriculture Supply Corporation (ASC) before it was merged with the Food Management Committee under the new outfit, Agriculture Marketing Corporation (AMC). AMC dealt with both agricultural inputs and food grains for about two years. In 1974 the government decided to split AMC into AIC for the management of agricultural inputs and Nepal Food Corporation for the marketing of agricultural produce.

On May 8, 2002 government converted AIC into Krishi Samagri Company Ltd. (KSCL) and National Seed Company Ltd. under Company Act 1997 as a state owned enterprises. KSCL has been assigned by the government to procure and distribute fertilizers across the country. As Nepal does not have indigenous production of mineral fertilizers, demand for fertilizers is met through importation. The government has retained hundred percent equity of KSCL. Now, National Seed Company Limited has merged into the Krishi Samagri Company Limited. KSCL produces seeds and distributes all over the country through its own offices.

In a major policy decision to boost agricultural production and to ensure smooth supply of mineral fertilizers, the Government of Nepal has decided to reintroduce subsidy on mineral and organic fertilizer on March 25, 2009. KSCL has been entrusted with the procurement and distribution of subsidized fertilizers across the country.

Fertilizer Policy
Until 1972, cost plus basis of fertilizer policy was adopted owing higher price in the hills than in the terai plains. The retail price of hills was made higher in proportion to the actual transportation cost incurred. Following the oil crisis of 1972 and rise in the international price of fertilizers the government fixed the maximum retail price across the country and introduced subsidy regime.
In 1997, the government announced policy reforms in the fertilizer sector eliminating subsidy on non-urea fertilizers and phase wise withdrawal on urea. Likewise, the government established Fertilizer Unit under Ministry of Agriculture and livestock development to facilitate favorable policy and institutional environment for the participation of public and private sector.

Deregulation policy largely failed to bring desirable impact on improving supply situation and quality control of fertilizer. External factors such as rise in price in international market, heavy subsidy enjoyed by the farmers across the porous border and inflow of illegally traded fertilizers aggravated the situation. The government finally decided to provide subsidy on mineral fertilizers on March 25, 2009.

Silent features of current fertilizer Policy:
KSCL will be the sole agency to import fertilizers under subsidy scheme.
Provision of a high level “Subsidy Allocation Management Committee” under the chairmanship of Secretary of MOAC. The committee is mainly responsible for fixing retail price and subsidy reimbursement to KSCL.
Subsidized fertilizers will be available for up to 0.75 ha and 4 ha in the hills and terai respectively for three crops a year.
Fertilizers will be retailed through KSCL field offices and cooperatives.

Fertilizer Pricing

Under the new fertilizer policy uniform retail price of fertilizers is fixed for five entry points by the high level Subsidy Management Allocation Committee chaired by the Secretary at Ministry of Agriculture and livestock development. But at present as fertilizers is being imported through three entry points so the retail price of three entry points (Biratnagar, Birgunj and Bhairahawa) is fixed with due consideration of import cost, transportation cost, handling cost as well as effective retail price in India. Actual transportation cost incurred from three entry points to other districts will be added to determine the retail price of fertilizers for all districts.

Ministry of Agriculture and livestock development advances subsidy amount to Krishi Samagri Company Ltd. in three instalments and subsidy account is settled by the high level committee at the end of the fiscal year.

Fertilizer Distribution
KSCL field offices as well cooperatives are involved in the distribution of fertilizer across the country. KSCL administers retailers under dealership regulation as approved by the Board of Directors. At present 5,300 cooperatives and cooperative shops are retailing fertilizers.


Fertilizer Supply and Distribution Management Committee headed by Chief District Officer of the respective districts is being empowered to look after the affairs related to the supply and distribution of fertilizers at the district level. It is believed that district based committee acts promptly to ensure free, fair and smooth supply and distribution of fertilizers.

Fertilizer Procurement
KSCL is being made responsible to procure subsidies fertilizer from 2009. Fertilizer is being imported from the international market through global tender on the basis of CIF Kolkata/Haldia (India) port or CIF Nepal KSCL border warehouses entry points. (I.e. Biratnagar, Birgunj, Bhairahawa).
KSCL invites sealed tenders for the supply of fertilizer by publishing global tender notice in the reputed national newspaper. Invitation of global tender is based on seasonal demand. Normally KSCL invites eight to ten global tenders in a fiscal year. It takes four to five months to import fertilizer through global tender. At present KSCL have imported fertilizer from Turkey,Oman, Peoples Republic of China, Egypt, and India.

Beside global tender, KSCL is also importing fertilizer from India on government to government basis on Import Parity Price (IPP) of India. KSCL also procures as directed by the government fertilizer received on grant/aid by the donor government as buffer stocks and distribute it.


Objectives
The government of Nepal has re-introduced fertilizer subsidy scheme from 2009 to boost up agricultural production and to ensure food security, and KSCL is fully geared up to fulfill the expectation of the government. Objectives of KSCL as set out in the memorandum of association are as follow:

Produce, procure and import different types of mineral fertilizer and distribute it across the country on the basis of local demand.
Import raw materials for the production of different product mix of fertilizers and distribute and export as well.
Maintain buffer stock of fertilizers received under grant/aid from the government, donor countries and organizations to control supply interruption.
Procure and distribute the subsidized fertilizer across the country.
Conduct other business and service oriented activities to ensure reasonable profit.

Other Activities
Other Activities To sustain and to meet the multipurpose objective , KSCL is going to involve following activities too:-
KSCL is planning to diversify its business activities to ensure uninterrupted supply of essential commodities across the country.
To maintain the quality of soil company is introducing the agriculture limestone from F.Y 072/073.
The Company has got land and infra structures in Prime location through out the country. So the company has taken long term plan to utilize these unuse land and infrastructure by leased or sell out.
KSCL produces and distributes of seeds.(eg. wheat, maize, paddy through coperative and agrovet)

 
 

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Site Updated On : 2022-11-07

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