In Majhthana, a remote hill station in Kaski district, Chandra Kanta Ghimire, a returnee migrant, wakes up early to cook khole (a soup of maize flour and vegetables) to feed his buffaloes. He has minimal green fodder, so he supplements their diet with a mixture of dry straw.

Ghimire owns 10 Murrah buffalos. These water buffaloes originate in Haryana and Punjab, India and are mainly known for producing a high volume of milk. Until recently, he had no idea about the buffalo meat export prospects.

Eleven months ago, he took another Rs2.3 million loan and added more buffaloes.

“I spent Rs600,000 to erect a shed and have decided to add two buffaloes this year.”

Ghimire said that a Murrah buffalo costs around Rs170,000. “I milk 50 litres a day, making a monthly income of Rs147,000 by selling it at Rs115 per litre,” said Ghimire, who dreams of buying a car with the income in four or five years. The 51-year-old farmer recently bought a washing machine.

Ghimire said he hasn’t considered rearing buffalo for meat. “But I have heard it’s rewarding,” Ghimire told the Post last month.

Commercial buffalo rearing for meat purposes is limited in Nepal, and the export of buffalo meat is negligible.

This week, on Monday, Beijing opened a trade prospect for the meat industry, apart from traditional handicraft products, which Nepal has been exporting to its northern neighbour for decades.

During Prime Minister KP Sharma Oli’s recent visit to China on December 2, Beijing surprised Nepal by opening its doors to water buffalo meat.

On social media platforms, many users pointed out that during then Prime Minister Pushpa Kamal Dahal’s trip to New Delhi in May, his counterpart gifted 15 Murrah buffaloes to Nepal, while Prime Minister Oli travelled to China and agreed to sell buffalo meat.

But for Nepal’s ailing agricultural sector, this Chinese initiative represents a huge prospect and may significantly help the country’s graduation from least developed country (LDC).

As per the statistics, if the buffalo meat export materialises, it could surpass the total export earnings from the 32 high-value goods identified by Nepal Trade Integration Strategy (NTIS), which totalled Rs110.38 billion in the last fiscal year.

The trade strategy was revised last fiscal year to support Nepal’s graduation from the LDC status to a developing country by 2026.

On December 16, Himalayan Food International, a private company in Nepal, and Shanghai Ziyan Food, a company in China, inked a business-to-business agreement in Kathmandu to export buffalo meat.

“Immediately after the successful visit of Rt Hon PM and agreement on Buffalo meat export to China. The game-changing MOU of Strategic Cooperation for Nepal Thermally Processed Buffalo Meat Products Export Project to China is inked today, which has opened over 100 billion rupees in the buffalo farming industry in Nepal, benefitting tens of thousands of rural families. Congratulations to both our people,” Chinese Ambassador to Nepal Chen Song wrote on X.

Beijing is employing soft trade diplomacy to buy $1.5 billion worth of buffalo meat from Nepal in a year, terming the project a game-changer.

Experts say that’s a big opportunity for Nepal, whose annual export to China is Rs2.58 billion.

The meat Beijing has sought from Nepal accounts for almost 66 percent of Nepal’s annual imports from China, which total $2.21 billion.

But challenges galore.

“China may offer technical help to build a processing facility for this purpose,” said Mahanand Joshi, a senior agri-economist at the Ministry of Agriculture and Livestock Development.

“A Nepali private company will export $1.5 billion of buffalo meat annually, depending on Nepal’s production. The government will invest to increase buffalo production accordingly.”

“To meet the target of $1.5 billion, we need to meet the technical standard for export, and work will be expedited for this purpose.”

However, Nepal’s present buffalo population can’t even meet the high domestic market demands, and insiders say buffalos are brought in large numbers from India.

The buffalo meat industry of Nepal is still experiencing a market gap due to the demand-supply mismatch.

The Beijing initiative opens new opportunities for entrepreneurs to fill the gap.

The total meat production in Nepal peaked at 552,156 tonnes in 2019-20 due to the Covid pandemic, when people started to take an extra protein diet to fight the virus.

However, production gradually dropped to 520,742 tonnes in 2020-21 and 512,788 tonnes in 2021-22.

The production fell sharply to 430,085 tonnes in 2022-23, which experts attributed to an exodus of Nepali youth, the key population who loved eating meat. Government statistics show that labour permits and student visas were issued for nearly a million Nepalis in 2022-23.

Buffalo meat, which represents 27 percent of total meat production in Nepal and has 20.23 grams of protein content per 100 grams, higher than other types of meat, rose to 189,517 tonnes in 2019-20. Production fell to 188,172 tonnes in 2020-21 and peaked at a time high of 194,090 tonnes in 2021-22.

The output then shrank to a nearly two-and-a-half-decade low of 116,503 tonnes in 2022-23.

The population of live buffalos, which was 3.70 million heads two decades ago, reached 5.30 million heads in 2018-19, the highest count.

But since, the population has decreased, reaching a three-decade low of 3.08 million heads in 2022-23.

Government officials see the Beijing initiative as a game changer for Nepal’s livestock sector.

Sudhir Kumar Singh, information officer at the Department of Livestock Services, believes Nepal can meet the Chinese demand.

“As demand for buffalo meat has declined, farmers too were discouraged. But if there is a trade prospect, commercial farming may thrive again.”

Livestock traders say it is a day-dream.

“Domestic production is not enough to meet domestic demand. We estimate that nearly 70 percent of buffaloes in Nepal are imported from India illegally to meet the buff demand,” said Jiban Khatiwada, president of the Nepal Livestock Traders Association.

“In this scenario, immediately exporting buffalo meat in such a large amount is impossible.”

Ghimire, the farmer in Kaski, says he didn’t import buffaloes from India. “A group of agents smuggle them. It’s not possible to bring Murrah buffalos from India legally.”

Nepal has become self-reliant in goat and chicken production but not in buffalo.

However, Navin Kumar Sharma, chairman of Himalayan Food International, is optimistic about the ambitious agreement. “But it will take some time.”

“It is feasible to export $1.5 billion worth of buffalo meat to China by 2027-28 if we aggressively start rearing buffalo. We will start exporting 500 tonnes, as per our target. For this, we need to slaughter 5,000 buffaloes daily,” said Sharma.

Chinese investors will put in Rs27 billion in two projects. Investment of Rs21 billion will be mobilised for buffalo rearing in three locations: Hariharpur Gadhi in Sindhuli, Ilam and Madi of Chitwan. Similarly, under the project, a Rs6 billion processing plant will be set up in Hariharpur Gadhi.

Chinese investors are scheduled to inspect the factory in six months.

“So, by the time they come, we must keep 40,000 buffalo calves. The Chinese investors have given us a target of rearing 200,000 buffalo heads in a year,” said Sharma.

“We have to ensure that the buffalo meat originates in Nepal, but we will be exempted from the origin certificate for the first two years.”

Sharma said he was exporting buffalo meat to Vietnam until the pre-Covid period, which then used to be re-exported to China.

Buffalo is being produced primarily in Tarai areas. It takes two years for a calf to become mature for meat production.

Khatiwada said people rear buffalo for milk, but as buffalo milk production is low, farmers focused on milk production have shifted to cow rearing. Also, it is comparatively easier to rear cows than buffaloes.

Khatiwada said any increase in production depends on the government’s policy. “Once buffalo meat starts being exported to China, its price will rise domestically due to the push in demand. This might also encourage more farmers to start buffalo rearing,” he said.

“But whatever the case, this project is undeniably ambitious.”