This is a research-based power point presentation of Swertia Chirayita, Nepal

1. Value Chain Analysis of Chiraito
(Swertia chirayita)
Value Chain development for
commercial Chiraito Cultivation
in Taplejung, Nepal
Researchers
1. Damodar Gaire'(A. Professor, Tribhuvan
University, Institute of Forestry, Nepal
2. Rishi Ram Kattel (A. Professor, Agriculture and
Forestry University, Nepal )
Submitted to
The Poverty Alleviation Fund, Nepal
@ Gaire D, Kattel RM. 2018. Value Chain Analysis of Swertia Chirayita in Taplejung district,
Nepal. The report submitted to Poverty Alleviation Fund, Kathmandu, Nepal

2. Introduction
• Swertia chirayita, a perennial herb, is the major source of
income in rural households of eastern Nepal. It is locally known
as Chiraito, Tite and Pothi Chiraito in Taplejung district. Since
2005, local people have been cultivating Chiraito as a means and
ways for making living in the northern Taplejung (Pyakurel,
2013).
• The extensive cultivation practices have started in Nepal since
2014. The Mountain Institute (TMI) of Washington, D.C. reports
that they have trained more than 16,000 farmers to cultivate
and harvest medicinal and aromatic plants (MAPs) in Nepal as a
means to earn a living.
• The Poverty Alleviation Fund (PAF) has also invested for Chiraito
cultivation in Sirungkhim, Taplejung, cultivated 15000 Ropani
lands of 92 Chiraito farmers. Now, farmers would like to extend
the Chiraito farm for sustainable income and environmental
sustainability. However, price is decreasing in trends.

3. •Nepal supplies 45% of total Chiraito
production in the world. (Joshi and
Dhawan 2005)
•In Nepal Swertia chirayita is found in
55 hills and mountain districts
(Barakoti, 2004)
•In case of Taplejung, 85% of total
Chiraito production comes from the
Chiraito cultivation, and remaining
15 % comes from either community
forests or government managed
forests (DFO Taplejung, 2018).
•Map indicates the Chiraito
distribution in Nepal and the world.
Source: He, J, et al, 2018
Distribution of S. Chirayita

4. Surumkhim is situated at Sidingwa rural municipality of Taplejung
district. The Poverty Alleviation Fund (PAF) has also invested for Chiraito
cultivation in Sirungkhim, Taplejung, cultivated 15000 Ropani lands of 92
Chiraito farmers.
Chirayito Cultivation Areas

5. The main objective of the study is
to provide a comprehensive Value
Chain Analysis of Chiraito for both
market and social benefit.
Methods: Review of secondary data
information ,literature review, Focus
Group Discussion, Interview/Interaction
with traders, middleman, and Chiraito
cultivators

6. Results
0
200
400
600
800
1000
1200
1400
1600
1800
2000
March
012
March
013
March
014
March
015
March
016
March
017
March
018
District
India (New Delhi)
China
Month/Year District
India (New
Delhi) China
March 012 512 840 1250
March 013 700 800 1500
March 014 650 760 1600
March 015 450 656 1650
March 016 425 640 1670
March 017 425 600 1675
March 018 300 800 1782
Price Trends of Chirayito

7. Market Analysis
0
1
2
3
4
5
Demands
of
seedlings
Grading of
Chiraito
Compressi
ng
Price
sensitivity
Demands
and supply
Knowledge
on legal
procedure
Cultivation
Technical
expertise
for…
Market Demand
Existing Situation
In the present situation
(According to the field visit
of Sirungkhim, Taplejung),
there was an imbalance
between market demands
and gaps of Chirayito.
Current Market Channel
Collector - > Village Trader -> Regional Trader - > Exporter
Collector - > Village Trader - > Exporter
Collector - > Village Trader - > Regional Trader - >Wholesaler - >Exporter
Figure: Market demands and gaps of Chirayito, (Source:
FDF, Taplejung, 2018)

8. ENABLERSACTORSFUNCTIONS
Export
Exporters
Tibet
(>40%)
India
(>50%)
Bangladesh
(>5%)
DOF, DPR, Custom,
FNCCI, NCC,
JAWAN, projects
Trading
Village Level Traders
/Middleman
District Level Traders
Regional Traders
DFOs, MFIs,
Cooperatives, NGOs
and Projects
Production Chiraito Cultivators, Collectors
Inputs /Raw
material supply
Private Chiraito cultivation
lands, GFs, CFs and PFs
PAF, DFOs, MFIs,
Cooperatives and
farmers` groups
PAF, MFIs and
Cooperatives
Existing Value Chain Map of Taplejung,
According to data
received from DFO
Taplejung (2018, The
allowable harvesting
amount of Chiraito is
39.5 tones. However,
26.3 tones of dried
Chiraito have been
transported in the fiscal
year 2074/2075 which is
comparatively low
compared to allowable
harvesting amount

9. Value
chain
level
Situation analysis Key Gaps Intervention activities
Inputs and
services
Farmers have cultivated the
Chiraito in sloppy and
uncultivated areas in their
own ideas and knowledge.
Farmers have not received
any facilities like quality
seeds, JT/JTA, Agro vet, etc.
Relay on other sources of
Chiraito Seeds
Quality Chiraito Seed production (village
based)
Cooperative investment on cultivation, soft
loan, etc.
Production Production is only 2-3
man/Ropani(1 man =40 Kg)
Farmers used to broadcast
the seeds directly in the
field with minimum land
preparation
Support farmers for land preparation,
manure and fertilizers, nursery
management, watering including soft loan
or revolving fund to Chiraito cultivators.
Collection/t
rading
Immature harvesting, not
appropriate post harvesting
technology
Lacks of technical experts
on Chiraito post-harvesting
techniques,
Information gaps on
Chiraito prices.
Training on post harvesting technology,
business information system, orientation
among farmers, middleman and traders.
Processing Limited processing of Chiraito,
only cleaning, drying and
storing
Lacks of herbal extract, not
any product of Chiraito
within the district
Formation of NTFPs cooperatives, value
addition (Pressuring, packaging, branding ),
Chiraito tea production, chiraito powder
End market High demands on seedlings,
price sensitivity, not any
grading system
Market demands and gaps
in Chiraito production.
Quality seedlings production, TOT on the
legal procedure of Chiraito to Farmers,
network building and value addition
Backward
linkage
Lacks of functional upgrading
in value chain of Chiraito
Not the meaningful
coordination from
producers to final products
Functional upgrading in overall chain of
Chiraito Value
Forward
linkage
Just only sell the Chiraito after
air/sun dried form
Lacks on collaboration
with herbal manufacturing
companies.
Chiraito product development
Existing
value chain
condition
and
appropriate
upgrading
strategies

10. Chirayito Sub -Sector VCD potentiality for five years
Aspects of Chiraito Sub-sector VCD Potentiality Year 1 Year 2 Year 3 Year 4 Year 5
Income will be generated (Annual) (NRs. in Millions) 47.2 0.0 409.2 0.0 409.2
Initial Investment/loan fund required (Annual)(NRs., in
Million, both FC+OC)
47.2 15.2 51.3 15.2 51.3
Available capital fund (RF) from COs to be mobilized
(NRs. In Millions)
31.0 31.0 31.0 31.0 31.0
Loan fund to be required from external financial
institutions (NRs. Millions)
16.2 0.0 20.3 0.0 20.3
No. of Self Employed/No. of Entrepreneurs 620 620 620 620 620
No. of employment generated (seasonal) 1860 1860 1860 1860 1860
Production (quantity) (MT) 744 744
No. of potential SMEs to be created for value chain
(processing, marketing, and product diversification)
6 6
No. of employment to be generated by proposed
SMEs
62 62
Total employment generation, including enterprises
and SMEs from PAF intervention
2480 2480 2548 2548 2548
Return to Investment (RoI)% 309.2 309.2
Market Share (%) 35.9 35.9
No. of HH members benefited 11656 11656 11656 11656 11656
B/C ratio 3.9 3.9

11. Cost of Production
First year
Particulars Quantity Rate Total Remarks
Nursery preparation 12 600 7200
Pipe and other items purchase (set) 1 25500 25500
Land preparation 46 600 27600
Seeds (Kg) 0.5 6000 3000
Compost fertilizers (tons) 12 850 10200
plantation on the field 46 600 27600
Weeding and composting 32 600 19200
Regular watering (man days) 33 600 19800
Sub Total 140100
Second year
Particular Quantity Rate Total Remarks
Compost fertilizer 12 850 10200
Weeding and composting 32 600 19200
Regular watering (Man days) 33 600 19800
Sub Total 49200
Third Year
Particular Quantity Rate Total Remarks
Compost fertilizer 32 850 27200
Weeding and composting (Man days) 12 600 7200
Regular watering (Man days) 32 600 19200
Harvesting (Man days) 32 600 19200
Drying and storage (Man days) 45 600 27000
Sub Total 99800
Grant Total (cost of production/Ha) 289100
Grant Total (cost of production/Ropani) 14455

12. SWOT Analysis
Strength Weakness
• Local people have used their existing knowledge on
Chiraito Cultivation and collection.
• Government of Nepal has also prioritized S.
Chirayita for Domestication and cultivation (One
among the 13 major medicinal plants)
• Easy for plantation in marginal and underutilized
land;
• Farmers have already practiced and increased their
income through Chiraito cultivation in different parts
of Nepal.
 At least two and half years cultivation time resulting less
interest of farmers for commercialization.
 Requires higher effort on land preparation, production
process, any negligence can decrease productivity;
 Quality seeds/seedlings of Chiraito can only be found in
limited places of Nepal
 Variation of production (2-3/man/Ropani to 5-6/Man
Ropani) depending on manuring, watering , slope,
exposure and care and adjustment in Chiraito cultivation
areas.
 Fluctuating prices (NRs 10000 -NRs60000/Man) (1 Man =
40 Kg )
Opportunities Threats
 The products can be sold throughout the year
• Compressing opportunities to reduce transportation
cost;
• Possibility of making powders for industrial usage
• Value addition of Chiraito for getting good prices
• Community based Chiraito enterprise for income
generation and sustainable livelihoods.
• Products manufacture (Chiraito Herbal Tea, Power
form of Chiraito for Gastric, sugar and blood
pressure patients, Chiraito face wash, etc through
NTFPs cooperatives.
 According to the field based FDG (Taplejung), it
was found that farmers collect or harvest Chiraito
in very immature stage which leads for
unsustainable harvesting.
 95% of the market depending on India and china
only. The remaining 5% is Bangladesh and other
European countries .
 Limited number of farmers on commercial
cultivation of Chiraito.
 Disease/pest on Chiraito farm. Fungal disease is
the serious problem in the Chiraito farm.
 Nutrient management and land preparation in the
slopy lands is the major threats in Chiraito

13. Conclusion
• 40 percent of the total production in Chirayito goes to China market
which is more than 10 percent of the previous year (2017) in
Taplejung. Agreement between Farmers` cooperative and buyers is
essential for encouraging farmers' towards Chiraito cultivation.
• The annual harvestable amount of Chiraito is 92 tons in Taplejung, and
demand for Chiraito is 102 tons. The imbalance between market
demands and Chiraito supply has been clearly seen.
• The Poverty Alleviation Fund (PAF) has been conducting Chiraito
Cultivation Project in coordination with Dalit Uthan Manch (DUM).
Local farmers got an opportunity for enhancing their knowledge
towards Chiraito cultivation.
• The farmers have been using the PAF`s revolving fund of NRs 10 lakhs
in Surumkhim (Sidingba Rural Municipality-7), Taplejung. The existing
chiraito cultivation areas vary from 1.5 Ropani to 35 Ropani. The
average area for Chiraito cultivation is 9.5 Ropani. Creating 650
enterprises up to 5 years will be the future prediction.

14. Recommendations
•Quality seed supply
•Access to Market
•Technology and product
development
•Recommendation for
upgrading strategies

15. Cont..Recommendation
Upgrading Strategy Recommendations
Product Upgrading Quality Chiraito cultivation, collection, and marketing;
Process Upgrading Scientific collection practices, Organic cultivation, Use of compressing
Machine
Function Upgrading Cultivation of Chiraito focuses on poor and disadvantaged people in the
community, capacity building training, NTFPs based cooperative
management, crop insurance, soft loan
Channel Upgrading Best price: India or Tibet or Bangladesh (depending on demand and supply);
Inter firm Upgrading Facilitate in the formation of Chiraito based network ( including
Collector, cultivators, traders and supporting organizations); DFO Taplejung
plays the vital role for inter firm upgrading.
BDS+ FS Strengthening Technology transfer, Access to finance, Legal
Process for trade, sharing the market information, TOT trainer
development, Seedlings supply;
Business Enabling
Environment
Orientation and education on the process of legal trade of Chiraito from
Private land, CF land, and national forest;
Strengthening
Sustainability Strategy
Strengthening of Chiraito network for backward and forward linkages, PAF
plays the vital role in enhancing both linkages.
Source: Field Consultation, 2018