Trade and Environment Dimensions in the Food and Food Processing Industries in

South Asia ( Nepalese Context )

6-7 September 2006, Colombo, Sri Lanka

Narendra Prasad Pokhrel Senior Divisional Chemist

Environmental Standard, Monitoring and Pollution control Section - Chief

Ministry of Environment, Science and Technology Singhadurbar, Kathmandu, Nepal

AndArjun K. Pudasaini

Account OfficerMinistry of Industry, Commerce and Supply

Singhadurbar, Kathmandu, Nepal

Country Background

• Nepal lies in South Asia between India and China

• Population - 23.4 million • The country has a length of 885 km fro east

to west and an average width of 193 km from north to south

• The nearest point from the sea is about 960 km

• Nepal is among the 27 least developed and 15 land-locked countries.

• The altitude varies from 60 m in the south to 8848 m high Mt. Everest in the North

Country Background

• Nepal has flat land in the south, hills and valleys in the middle and lofty Himalayas in the north

• The southern part (low land) occupies about 17% of the total land area

• It is fertile with alluvial soil and produces about 60% of the total grain production of the country.

• The central part of the country has moderate size mountains ranging from 1000 to 3000 m having warm to cold temperature climate

• The hill slopes are terraced for cultivation and forests cover the remaining land. Most of the rivers are located in this zone. About 52% of the total population of the country lives in this zone.

Introduction

• The Government of Nepal is taking steps towards sustainable development with policies in place regarding environmental management.

• Most of the legal provisions on environmental management are very new and some require setting up of environmental standards and other requires extended rules and regulations for enforcement and necessary institutional setting.

The constitution of the Kingdom of Nepal,1990

• “The state shall give priority to the protection of the environment and also to the prevention of further damage of the environment due to physical development activities by increasing the awareness of the general public about environment cleanliness and make arrangements for the protection of the rare wildlife, forests and the vegetation.”

EPA, 1997 and EPR,1997

• The Environment Protection Act (1997) and Environment Protection Regulation (1997) are major steps achieved to address environmental management so far.

Major provisions in the EPA and EPR

• Prevention and control of Pollution.• Environment Inspector.• Protection of National Heritage• Environment Protection Area.• Establishment of a Laboratory.• Establishment and operation of

Environment Protection Fund.• Power to Constitute Environment

Protection Council.

Major provisions in the EPA and EPR• Provision of Concession and facility

• Provision of Compensation• Provision of Punishment• Power to Frame Rules• Provision of IEE and EIA.• Provision of lodging Complaint.• Power to grant rewards,

commendation letters.

Other Environmental Institutions

• Ministry of Forest and Soil Conservation • Ministry of Industry, Commerce and Supplies.• Ministry of Agriculture and Co-operatives.• Sectoral Ministries such as Water Resources,

Labor and Transport, Local Development, Health etc and concerned Departments.

• Environment Protection Committee, House of Representative, 1990.

• National Committee on Man and Biosphere, 1974.

Other Environmental Institutions

• National Resources Conservation Commission, 1980.

• Environment and Resources Conservation Division in the National Planning Commission, 1987

• Council for Conservation of National and Cultural Resources, 1990.

• Environment protection council, 1992, chaired by Rt. Hon. the Prime Minister.

• Municipalities.• Nepal Electricity Authority.

Private Sector and NGOs

• FNCCI is the apex body representing the private sector of the business and entrepreneurs in Nepal.

• FNCCI has an Environmental Division to look into environmental issues.

• Some NGOs like Nepal Forum of Environmental Journalists (NEFEJ), Environmental and Public Health Organization (ENPHO) and other NGOs are also involved in raising awareness and to deal with the environmental problems.

The Relevant Acts

• Industrial Enterprises Act, 1991• Labor Act, 1991• Pesticides Act, 1992• Local self-governance Act, 1999• The Town Development Act, 1988 • The Aquatic Animals Protection Act,

1961 • The Tourism Act, 1978

The Relevant Acts

• The Soil Conservation and Watershed Management Act, 1982

• The Nepal Water Supply Corporation Act, 1989

• The Municipality Act, 1991 • District Development Committee Act,

1991 • The Water Resources Act, 1992 • The Forest Act, 1992

Existing Acts and Regulations related to Food and Food

processing Industries

• Food Act 1966 and Food Regulation 1979• Feed Act 1976 and Feed Regulation 1984• Slaughterhouse and Meat Inspection Act

1998• Slaughterhouse and Meat Inspection Rules

2000• Animal health and livestock service act

1998• Animal health and livestock service Rules

2000

Existing Acts and Regulations related to Food and Food

processing Industries

• Breast feeding substances (Sales and Distribution control) Act 1992

• Breast feeding substances (Sales and Distribution control) Rules 1994

• Iodized Salt (Production, Sale and Distribution) Act 1999

• Pesticide Regulation Act 1991• Plant Protection Act 1972 and

Regulation 1972

Proposals requiring Initial Environmental Examination

• Production of alcohol by the process of blending and establishment of distilleries equipped with boiling and fermentation facilities with a production capacity of 5,00,000 liters per day.

• Establishment of breweries and wineries equipped with fermentation facilities with a production capacity of 5,00,000 liters per day.

• Establishment of dairy processing industries.

• Establishment of crude sugar industries with a production capacity of 3000 metric tons per day.

• Establishment of pharmaceutical industries.

Proposals requiring Initial Environmental Examination

• Establishment of the following industries having investment of total fixed capital exceeding Rs 1 million.– Slaughter house– Food Processing– Cold storage– Vegetable ghee, oil– Herbal Processing– Fish and Meat Processing

Proposals requiring Initial Environmental Examination

• Establishment of the following agro-based industries which do not dispose of polluted substances mixed with dangerous toxins:– Milk-processing industries with a capacity

of not more than 26,000 liters a day.– Such agro-based industries as those

producing jam, jelly, squash and juice– Cheese industries– Baby food industries

• Commercial fish –farming in an area of more than 1 hectre.

Proposal requiring Environmental Impact Assessment

• Commercial and industrial processing of medicinal herbs and aromatic plants which emit garbage and pollution.

• Establishment of distilleries equipped with boiling and fermentation facilities with a production capacity of 5,00,000 liters per day.

• Establishment of industry producing more than 3000 metric tons of crude sugar and sugar per day.

• Production of primary compound ( Bulk drugs) for medicines.

Industries requiring Pollution Control Certificates • Relating to production of liquor

through blending process of distilleries with facilities of boiling and fermentation.

• Relating to brewers and winery with a facility of fermentation.

• Relating to milk processing• Production of crude sugar and sugar• Relating to medicines• Relating to slaughter house

Industries requiring Pollution Control Certificates

• Relating to food processing• Relating to Cold Storage• Relating to vegetable ghee and

oil• Relating to herbal processing• Relating to fish processing• Production of Primary Chemicals

(bulk drugs) for medicine.

Prevention and Control of Pollution Prohibition to emit waste in contravention of

the prescribed standard:• No person shall emit or cause the emission

of noise, heat, radio-active material of waste from any mechanical means, industrial establishment or any other place in contravention of the standards prescribed by the Ministry by notification published in the Gazette.

Provision relating to Provisional or Permanent Pollution Control Certificate

• All industries which are referred to in Schedule-7, within 60 days from the date of beginning of production obtain The Provisional Pollution Control Certificate.

• In cases where the standards for any industry have been determined, the concerned body shall require to issue a Permanent Pollution Control Certificate valid for a 3 years to the industries.

Cleaner Production in Nepalese Industries • As a preventive strategy to minimize wastes

and risk, and improve efficiency of the industrial processes, CP has been acknowledged by Nepalese industrialists are now more and more convinced that not all environmental activities are just cost incurring.

• CP generates economic savings and improve competitiveness while reducing the emissions to environment

The food related industries under CP assessment Total Food Sector 78

Bread and Biscuits 7

Catachu 2

Chocolate 2

Dairy 27

Dry Foods 3

Flour Mill 7

Mineral Water 1

Noodles 5

Pulse Mill 5

Rice Mill 4

Slaughter House 1

Soya bean 1

Spices 1

Sugar 1

Vegetable Oil and Ghee 11

Total 78

Exports of some major Commodities (Food) to overseas Countries

Amount in metric ton

2002/03 2003/04 2004/05

Tea 193.1 1,002.2 707.3

Pulses (Lentils) 5,429 7,590 2,708

Cardamom(Large) 570 1,111 1,215

Sugar 9,169 9,250 9,200

Import of some major Commodities (Food) from overseas

Countries

Value in ‘000 NRs

2002/03 2003/04

2004/05

Betel nuts 597,713 805,319 657,736

Cardamom 592,240 436,963 311,640

Rape Seeds 1,003,697 1,282,321 1,470,101

Crude Soya bean oil

1,481,429 2,423,967 2,341,594

Soya bean oil

94,065 91,099 195,824

Concentrate of non-alcoholic Soft drinks

341,557 377,845 406,773

Export of Selected Commodities (Food) to India

Value in ‘000 NRs

2002/03 2003/04 2004/05

Pulses 880,400 579,100 660,200

Ghee 54,600 76,500 62,900

Herbs 111,900 91,500 127,900

Ginger 315,400 287,100 137,400

Dried Ginger

108,400 78,000 73,400

Linseed 45,800 37,600 25,700

Fruits 2,400 900 1,500

Vegetables

43,000 18,100 17,200

Export of Selected Commodities (Food) to India

Value in ‘000 NRs

2002/03 2003/04 2004/05

Wheat Flour 7,100 32,200 400

Vegetable Ghee 3,812,300 2,959,000 4,635,900

Rice bran Oil 210,000 194,700 199,000

Cinnamon 4,700 6,300 9,200

Cardamom 469,600 451,000 600,700

Noodles 309,700 259,700 369,300

Biscuits 25,100 15,500 8,800

Hazmola 217,200 289,900 197,500

Value in ‘000 NRs

2002/03 2003/04 2004/05

Fruits 284,500 336,800 288,900

Vegetables 772,800 738,400 834,600

Milk Products

508,800 428,300 354,400

Tea 39,500 36,000 25,400

Coffee 37,000 40,500 49,000

Cumin seed and pepper

199,300 225,000 400,300

Salt 713,300 607,300 390,400

Sugar 119,500 12,800 56,400

Rice 744,900 555,500 412,700

Pulses 539,300 619,400 583,100

Wheat 216,500 270,300 1,200

Imports of Selected Commodities (Food) from India:

Exports of some major Commodities (Food) to Tibet

2002/03 2003/04 2004/05

Vegetable Ghee 196,173 139,810 191,034

Biscuits 36,501 97,351 27,517

Noodles 122,852 62,253 49,758

Wheat Flour Maida

73,370 57,878 153,544

Rice 2,330 40,848 78,560

Chocolates 11,896 33,745 11,040

Coffee 11,206 31,690 30,292

Bitten rice 14,999 18,073 12,516

Fruits 32,102 15,823 7,314

Tea 2,412 14,922 25,118

Fruit Juice 26,344 9,461 10,811

Value in ‘000 NRs

Imports of some major Commodities (Food) from Tibet

Value in ‘000 NRs

2002/03 2003/04 2004/05

Apple 177,724 81,901 121,542

Ginger 2,682 17,612 2,095