Introduction
FPO is an association of farmer members voluntarily controlled by themselves and open to everybody without gender, social, racial, political, or religious discrimination. It does not restrict education and training to its members and elected representatives but also extends to the managers and employees of FPOs.
Concept
- 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 rationale 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”.
- Farmers as Members
- FPO is an organization, wherein the members are farmers itself.
- Facilities
- Farmers Producers Organisation provides end-to-end support and services to small farmers with respect to technical services, marketing, processing, and others aspects of inputs related to cultivation.
- Schemes
- The Government of India has sanctioned 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.
- Small Farmers Agribusiness Consortium (SFAC)
- 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).
- Aims
- The aim is to enhance the competitiveness of farmers and raise their advantage while emerging market opportunities.
- Activities
- The principal activities of Farmer Producer Organization include seed, machinery, market linkages & fertilizer, training, networking, financial and technical advisory services.
Key features of FPO
- Minimum Members
- Initially, the minimum members in Farmer Producer Organization are 100 in North East & Hilly Areas and 300 in plain areas.
- The Cluster-Based Business Organizations form and promote the Farmers Producers Organizations and get them on boarded at the State or Cluster level by implementing the agencies.
- Farmer Producer Organization is promoted under “One District One Product” for FPO better branding, marketing, processing and exports by specialization.
- The CBBOs provide the initial training as well as adequate trainings & handholding for the Farmers Producer Organization.
- The formation of Farmer Producer Organization is given priority in aspirational districts with at least one FPO in each block of the aspirational districts.
Benefits of FPOs:
- Average land holding size:
- FPOs may involve farmers in collective farming and solve the problem of small farm sizes.
- Bargaining with Corporates:
- FPOs may help the farmers bargain with large corporate houses.
- Efficient Aggregation:
- Dre FPOs may offer member farmers low-cost and quality inputs and save member farmers’ time, transaction costs, and all other costs associated.
- Social Impact:
- FPOs can build social capital, improve gender relations and decision making, reduce social conflicts, and enhance food and nutritional values.
- Group Farming:
- FPOs can extend their land holdings by bringing together adjacent plots of land, creating a supply chain, and creating new markets.
- Way Forward:
- Not only do we need new FPOs in India, but also the structural issues have to be addressed in terms of technical skills, professional management, finances, access to credit, risk mitigation mechanisms, and markets and infrastructure.
