Soaring Food Prices in Nepal: Causes and Consequences

Abstract

The prices of food crops in Nepal have increased unusually over the years. The price rises have been caused due to a number of factors including low production of cereals, rising oil prices, untimely rainfall, increased feedstock, the international price rise, etc. The soaring food prices have seriously eroded the purchasing power of the poor people. The alarming rate of food price rise across the country calls for immediate response of the government. There are a number of options government can consider to address food security in the country. In short- term, the government should consider Implementing targeted cash transfer programs to the vulnerable groups, making the Food-for-Work programs more effective, introducing school feeding programs to improve the food intake of school age children, reducing tariff on food imports, introducing grain subsidies specially targeted to the poor, etc. But in the long- term, the government must pay increased attention to the agricultural production. There is also a need for enhancing and strengthening the capacity of Nepal Food Corporation so that it can play an effective role in monitoring food price situation in the country and helping to stabilize the price as and when needed.