34.837

68.400

6.500.000

Nepal

Key figures

Number of cooperatives per sector
Employees and members per sector

Research overview

 

Responding to challenges and existing knowledge gaps facing the cooperative movement, this mapping research seeks to provide exhaustive information on cooperatives worldwide. This is achieved through a process jointly conducted by the ICA and its four regional offices – Cooperatives of the Americas, Cooperatives Europe, ICA Africa, and ICA Asia-Pacific – using a common methodology. Each office collected the input of ICA members present in the countries within its geographic area, by using the same questionnaire, and completing it with relevant national statistics, in order to obtain an accurate picture of the national situation. Mapping out cooperatives in each country provides a more precise picture of the cooperative context at national and regional levels, enhances the movement's visibility, networking, partnerships opportunities, as well as advocacy, and empowers cooperators by providing them tools for positive change.

This webpage presents a snapshot of the research results for Nepal. For more information, you can download the full report and the highlights here.

History

 

Nepal has a long tradition of informal community-based groups engaged in savings and credit, grain savings and labour exchanges. Since their formalization in the mid 1950s, cooperatives have grown significantly, are found in diverse sectors and play an important part in the development of the Nepalese economy by integrating people from different ethnic, social and marginalized backgrounds. In the current times, the cooperative movement is focused on poverty alleviation while promoting women’s participation in cooperatives in membership and leadership roles. 

Overview

 

ICA has five members from Nepal. 



In Nepal, the research questionnaire was distributed to and completed by 3 ICA member organisations in the country. The data collected was for the years 2017, 2019 and 2020.


 

Summary

As of 2019, ICA members represent 34,837 cooperatives in Nepal with 6.5 million members and 68,400 employees.

Cooperatives are present across diverse sectors including agricultural, financial and savings, consumer, multipurpose, electricity and health, among others. 

 

Legal framework

 

The legal framework analysis aims to provide general knowledge of the national cooperative legislation and of its main characteristics and contents, with particular regard to those aspects of regulation regarding the identity of cooperatives and its distinction from other types of business organisations, notably the for-profit shareholder corporation.

It aims to evaluate whether the national legislation in place supports or hampers the development of cooperatives, and is therefore “cooperative friendly” or not, and the degree to which it may be considered so, also in comparison to the legislation in force in other countries of the ICA region, or at the supranational level.

In addition, the research aims to provide recommendations for eventual renewal of the legal frameworks in place in order to understand what changes in the current legislation would be necessary to improve its degree of “cooperative friendliness”, which is to say, to make the legislation more favourable to cooperatives, also in consideration of their specific identity. This webpage presents a snapshot of the legal framework analysis results for Nepal.

 

 

The Cooperative Act of 2017 is the only law that regulates cooperative associations in Nepal. There are no special laws on different types of cooperatives in Nepal. However, the current law covers only mutual cooperatives and not social cooperatives.

 

Main laws relevant to cooperatives in Nepal


Cooperative Act,2017 - One general law for all types of mutual cooperatives.

Constitution of Nepal 2015 - Recognizes cooperatives as an important base of the national economy. Article 50(3) of the Constitution stipulates that the economic objective of the state shall be to achieve sustainable economic development, while achieving rapid economic growth, by way of maximum mobilization of the available means and resources through participation and development of public, private and cooperatives, and to develop a socialism-oriented independent and prosperous economy while making the national economy independent, self-reliant and progressive in order to build an exploitation free society by abolishing economic inequality through equitable distribution of the gains.

 

Section 2(Pa) of the act refers to the ICA principles of cooperative identity.


 

Cooperative Friendliness 

 

Nepal’s cooperative legislation is “quite cooperative friendly”. The key reason for the same is that the Act was made in consultation with the cooperative federation and confederation. Also, Chapter 13 of the Act includes certain concessions and benefits provided to cooperatives.

 

Key recommendations for improvement

 

  • One would be to remove the complexities in the course of registering a cooperative such as limitations of the savings and credit cooperative within a Metropolitan city and a Sub-metropolitan city, which is not there in other cooperatives.
  • Need for a solution to the double regulation of cooperative banks by Nepal Rastra bank and cooperative department.
  • Provisions should be there to advance the cooperative model through the principle of self-regulation and not punishment. The Act needs to be amended to include social cooperatives as well.

 

Conclusions 

 

The Cooperative Act 2017 has commenced a new stage in Nepal’s cooperative movement. It has given the opportunity to increase the capacity of the cooperative sector in an effective, productive and competitive manner by increasing the capacity of its members and not just by increasing the number of members.

 

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