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Kathmandu, Bagmati Zone, Nepal
I am Basan Shrestha from Kathmandu, Nepal. I use the term 'BASAN' as 'Balancing Actions for Sustainable Agriculture and Natural Resources'. I am a Design, Monitoring & Evaluation professional. I hold 1) MSc in Regional and Rural Development Planning, Asian Institute of Technology, Thailand, 2002; 2) MSc in Statistics, Tribhuvan University (TU), Kathmandu, Nepal, 1995; and 3) MA in Sociology, TU, 1997. I have more than 10 years of professional experience in socio-economic research, monitoring and documentation on agricultural and natural resource management. I had worked in Lumle Agricultural Research Centre, western Nepal from Nov. 1997 to Dec. 2000; CARE Nepal, mid-western Nepal from Mar. 2003 to June 2006 and WTLCP in far-western Nepal from June 2006 to Jan. 2011, Training Institute for Technical Instruction (TITI) from July to Sep 2011, UN Women Nepal from Sep to Dec 2011 and Mercy Corps Nepal from 24 Jan 2012 to 14 August 2016 and CAMRIS International in Nepal commencing 1 February 2017. I have published articles to my credit.

Monday, October 28, 2013

Estimating Social Return on Investment of Social Protection Programs: Piloting an Approach in Irrigation Canal Improvement Project in the Far-western Hills of Nepal


Development organizations are asking where, when, and how much to invest in order to maximize their impact. Social return on investment is an attempt that values social benefit relative to the resources invested. This paper introduces a calculator that computes three measures namely discounted present value (DPV), net present value (NPV), and benefit cost ratio (BCR). Piloted in a food security project, the calculator measures the value of production through irrigation schemes. Two assumptions were made to estimate the measures: first, a discount rate of 10% per year and second, five years of benefit duration for irrigation canal improvement.

Eight clusters located in five village development committees in two districts of Baitadi and Doti were selected. 40 households, five from each cluster selected using a random sampling technique, were surveyed in June 2012. Irrigation schemes with the project cost of US$ 13.9 thousand out of a total of US$ 16.9 thousand increased production from 32 hectares of land in the entire clusters under pilot. To estimate the monetary value of the benefits in the clusters, the findings from 40 sampled household respondents were used. The survey data revealed an overall increase of 24% in the total production of paddy, wheat, maize, potato, lentil and soybean after intervention. With the increasing market price of commodities, the value of production increased by 45% per year. Given 32 hectares of land irrigated, the DPV and NPV were estimated at US$ 0.45 million and US$ 0.43 million respectively. Given the project cost, the benefit cost ratio was 32, suggesting that the benefit from the irrigation improvement was 32 times greater than the investment over five years. Thus, it was concluded that the irrigation canal improvement was positive investment in the targeted communities. 

High BCR poses whether irrigation scheme alone is attributed to the increased production of crops. There were several other interventions undertaken in the communities in order to improve the agricultural productivity, which were not accounted. Thus, the future studies need to consider the project logic and also the costs of other interventions that are intended to improve crop, for estimating the more realistic returns. Besides, it will be worth considering more measures highlighting different aspects of an investment, such as an Internal Rate of Return (IRR), to the calculators in order to illustrate a more nuanced picture of the investment.

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