The Mitsumata plant — the primary raw material for Japanese banknotes — is cultivated not in Japan but on the mountain slopes of Nepal, some 5,200 km from Tokyo, according to the Japan International Cooperation Agency (JICA). The revelation, shared as Japan and Nepal approach the 70th anniversary of their diplomatic relations, highlights a quiet but consequential supply chain that stretches across the Himalayas.

What Is Mitsumata

Mitsumata, or Oriental paperbush, is a deciduous shrub whose name literally means 'three-forked' in Japanese — a reference to the way its branches divide into three at the tips. Its fibres are exceptionally strong, making it a prized material for Japanese banknotes and traditional washi paper for centuries. Today, Mitsumata grown in Nepal is considered the highest quality in the world, according to Kanpou Inc President Matsubara Tadashi.

How Nepal Became the Source

Kanpou Inc, an Osaka-based company, first entered Nepal in 1990 after a staff member from Japan's Ministry of Finance printing bureau flagged a domestic supply crisis. 'Fewer people are growing Mitsumata, and it's becoming difficult to secure enough of it in Japan. Apparently, Mitsumata originates from the Himalayan region,' the official reportedly said. That observation prompted Kanpou to investigate Nepal as a cultivation base.

After several years of on-ground research, the company identified the Jiri region — where Mitsumata grew naturally across mountain slopes — as an ideal production zone. Matsubara then trained local communities, using video-based instruction rather than written materials to bridge language barriers.

How the Process Works

The production method involves harvesting Mitsumata on mountain slopes, steaming the plant to soften it, carefully peeling off the outer bark, washing it with water, and then drying it. According to JICA, these steps require no specialised knowledge and are not physically demanding, enabling broad community participation. 'Women living in mountain villages were able to work in their spare time between housework and childcare. By earning cash income, women who had long been in socially vulnerable positions gradually gained confidence,' JICA noted.

Economic Impact on Himalayan Communities

The income generated from Mitsumata cultivation has helped families in Nepal's mountain villages cover children's school fees and other household expenses, opening new educational pathways. The project has had a measurable effect on women's economic agency in communities that had historically lacked formal income opportunities.

In 2016, the initiative was selected for JICA's 'Support for Japanese Small and Medium-sized Enterprises Overseas Business Development' programme, following a referral through the Japanese Embassy in Nepal. With institutional backing, production areas expanded significantly and annual output grew from approximately 30 tons to around 100 tons, providing stable supply for Japan's banknote paper demand.

What This Means for Japan-Nepal Ties

The Mitsumata supply chain is now an essential pillar of Japan's currency production infrastructure. As both nations mark seven decades of diplomatic relations, the partnership illustrates how bilateral cooperation can generate durable economic outcomes — linking a Himalayan shrub to the banknotes circulating in one of the world's largest economies. Whether this model can be scaled further across other heritage materials remains an open question as Japan looks to diversify and secure its specialised supply chains.