Farmer Producer Organizations (FPO)

Farmer Producer Organizations (FPO)

Subject – Agriculture

Context – Just 1-5 per cent of FPOs have received funding under central government schemes introduced to promote them in the last seven years, the State of India’s Livelihood (SOIL) Report 2021 stated.

Concept –

• FPO is an organization, where the members are farmers itself. Farmers Producers Organization provides end-to-end support and services to the small farmers, and cover technical services, marketing, processing, and others aspects of cultivation inputs.
• The Government of India has approved and launched the Central Sector Scheme of “Formation and Promotion of 10,000 Farmer Producer Organizations(FPOs)” to form and promote 10,000 new FPOs till 2027-28 with a total budgetary outlay of Rs.6865 Cr.
• An FPO can be a Producer Company, a Cooperative Society or any other legal form.
• FPOs are basically the hybrids of cooperatives and private companies.
• The idea behind the Farmer Producer Organizations (FPO) was that “Farmers, who are the producers of their agricultural products, can form the groups and can register themselves under the Indian Companies Act”.
• Small Farmers Agribusiness Consortium (SFAC) was mandated by the Department of Agriculture and Cooperation, Ministry of Agriculture, Govt. of India, to support the State Government in the formation of the Farmer Producer Organizations (FPOs).
• The goal is to enhance the farmers’ competitiveness and to increase their advantage in emerging the market opportunities.
• The major operations of Farmers Producer Organization (FPO) include the supply of seed, machinery, market linkages & fertilizer, training, networking, financial and technical advice.

Key points of FPO 

• Initially, the minimum members in Farmer Producer Organization are 100 in North East & Hilly Areas and 300 in plain areas.
• The Farmers Producers Organizations are formed and promoted through the Cluster-Based Business Organizations and engaged at the State or Cluster level by implementing the agencies.
• Farmer Producer Organization is promoted under “One District One Product” to promote the specialization and better branding, marketing, processing and exports by FPO.
• The Farmers Producer Organization provide adequate training & handholding and the CBBOs provide the initial training.
• Priority is given for the formation of Farmer Producer Organization in aspirational districts with at least one FPO in each block of the aspirational districts.