Allo value chain

Poverty and male outmigration are affecting lives in far western Nepal, especially that of women (around 50 percent). Inaccessibility of location, lack of access to resources and services, and limited skills and capacities have traditionally constrained women’s participation as market actors. Under these circumstances, allo (Himalayan Nettle, in English) has become a high-value niche product around which women form groups and start small enterprises as home-based workers. With provisions for innovations in product design and for addressing quality expectations and needs, raw allo transforms into a viable value-chain product. Increased efficiency and innovation at the local level (turning mere barks to high-quality, branded, finished products) has not only enhanced the livelihood of rural women, but also increased their influence in the community.

 The issue

Naugad Rural Municipality, located in the remotest far western part of Nepal, is a pilot site of the Kailash Sacred Landscape Conservation and Development Initiative (KSLCDI) by ICIMOD. Housed in the Api-Nampa Conservation Area (ANCA), the municipality is characterized by poor accessibility, limited economic opportunities, and high outmigration, which leave women and marginalized communities behind. An estimated 20 tonnes of raw allo bark is produced annually in Darchula, with eight to nine tonnes of this sourced from Naugad (ICIMOD 2015). However, despite allo’s substantial availability, local people had limited knowledge and awareness until recently about the possibility of developing sustainable allo-based enterprises.

The solution

KSLCDI initiated its work in allo to mainstream the product into a commercial value chain, with a focus on conservation and sustainable development. In Naugad, a value-chain intervention was designed to bring possible innovation/value additions to this nature-based fibre, with the aim of providing sustainable incomes, and thereby building the resilience of the target community.

A community-owned common facility centre (CFC) was established with private-sector support from the SAARC Business Association of Home-Based Workers (SABAH) Nepal, a social business organization, which now has 82 members (69 women), with 150 households benefiting directly and indirectly from the centre. The centre has played a key role in demonstrating the various stages of product designs and ensuring quality, and in teaching about market needs and expectations and entrepreneurship. On the back of its initial success, the scope of the centre is increasing day by day. At present, 76 people work as active members of the CFC, of whom more than 75 percent are women. A majority of the women members are involved in stitching, tailoring, and weaving the fibre’s products. The centre has nurtured a number of women-owned enterprises at different nodes of the chain and provided various exposure opportunities in cities in India and Nepal. A buy-back guarantee provides security to the CFC members. The quality and range of allo products have increased markedly, opening up a greater possibility of value addition, as well as additional income to the community. Today, the CFC is trading various other products, such as beans, ghee, rice, and medicinal herbs to SABAH, as well as to other local and regional traders.

The involvement of marginalized groups, despite the restrictive socially constructed rules of participation, especially for women, has changed, as the marginalized groups are now viewed as important actors in the chain. Traditionally, the allo fibre has been processed, spun, and woven as a coarse product for household use; today, following the training, women have considerably increased their skills in allo thread-making, stitching, and weaving. They are now able to produce diversified products such as bags, purses, suits, cushion covers, scarves, shawls, pot holders, and runners to meet the market demand in both local and international markets. Through enterprise development and leadership training, the community enterprise today is run by these women leaders. Training programmes have featured picture series manuals so that women who are mostly uneducated can understand the market chain in a holistic and participatory way.

KLSDCI focused on strengthening the backward-forward linkage between SABAH Nepal and the community in order to build the resilience of the community. The initiative developed a mechanism with SABAH Nepal to build capacity at the local level, which strengthens their supply chain, reduces logistics costs, and increases the share of benefits to the community. A Kailash transboundary brand, “Kailash – Truly Sacred”, was created to provide these local products brand recognition in high-end international niche markets.

With investments toward enhanced production of allo, linkages with other line agencies, networking between individual groups/clusters, transboundary market interface between SABAH Nepal and Riva Organics, India, and water and energy conservation actions, the foundation was laid for sustaining the interventions. The following interventions helped minimize the effects of climate change and maintain a sustainable allo business in the area: establishment of a nursery for resource sustainability; rainwater harvesting and afforestation programmes for water conservation; use of improved cooking stoves for efficient energy supply; and the introduction of drought-resistant crop species.

Impact and uptake

The visible change indicators and characteristics of these interventions are increased individual and institutional capacities, higher income, innovative products, inclusiveness, better access to markets, and improved wellbeing of the community members. An impact study by ICIMOD indicates that the mean income of the target communities increased by nearly 30 percent between 2013 and 2015. Apart from seeing significant increase in income just from the sale of allo thread, the marginalized groups are earning additional income from bags, cushion covers, hats, mufflers, and coats, which they sell to SABAH Nepal at a premium price, as these products are sold in Kathmandu as well as on the international market. Members working in the CFC earn more than NPR 3,000/month from stitching, which is more than the local daily wage. That more than 25 allo-based entrepreneurs are now in business shows the outscaling impact of the intervention that KSLCDI started in 2014.

The interventions, which introduced new technology and process innovations, also had significant social and environmental benefits. To improve efficiency, modern equipment was provided to the CFC and its members. The replacement of the traditional katuwa (hand spindle) with modern equivalents improved thread quality and increased income from allo by 27 percent. The introduction of energy-efficient ‘rocket’ stoves reduced by two-thirds the amount of firewood needed to boil 30 kg of nettle bark. This intervention decreased tree felling and reduced smoke emissions and indoor air pollution.

Cooking time per batch was reduced by 45 minutes, providing women with more time to work in allo processing. Training programmes on sustainable harvesting and processing techniques have improved yarn quality considerably and also ensured regeneration of the plant. The use of ash instead of caustic soda, which reduces negative health impacts, is more environmentally friendly, and the ash makes for an ideal replacement for the chemicals that earlier used to leach into nearby rivers, polluting the water. The ash method enables production of chemical-free fibre, an organic product with a niche value in the international market.

Contributors

Anu Joshi Shrestha, ICIMOD

Lipy Adhikari, ICIMOD

Tashi Dorji, ICIMOD

Ghulam Ali, ICIMOD

Further reading/information

1)            Promotion of the Allo (Himalayan Nettle) ICIMOD

2)            Nepal’s Allo Value Chain Goes Green.