Farmers Producer Organisation
Why in News?
- The Government of India has been actively promoting Farmer Producer Organisations (FPOs) to empower small and marginal farmers by enhancing their access to markets, credit, and technology. This initiative aims to address agrarian distress and improve farmers’ incomes.
Important Key Points:
-
Definition and Purpose: FPOs are legally recognized entities formed by primary producers, such as farmers, milk producers, fishermen, weavers, rural artisans, and craftsmen. The primary objective is to facilitate collective farming, enabling members to achieve economies of scale, better bargaining power, and improved access to resources.
-
Legal Framework: FPOs can be registered under various legal structures, including the Companies Act, 2013, the Cooperative Societies Act, and the Indian Trusts Act, 1882. This flexibility allows for diverse organizational models tailored to specific community needs.
-
Government Initiatives: The central government launched the “Formation and Promotion of 10,000 FPOs” scheme in 2020, with a budgetary allocation of ₹4,496 crore over five years. Implementing agencies like the Small Farmers’ Agribusiness Consortium (SFAC), National Cooperative Development Corporation (NCDC), and National Bank for Agriculture and Rural Development (NABARD) are responsible for mobilizing and supporting FPOs.
-
Benefits to Farmers: FPOs offer numerous advantages, including collective procurement of inputs at lower costs, better access to credit facilities, enhanced market linkages, and the ability to undertake value addition and processing activities. These benefits collectively contribute to increased income and reduced vulnerability for member farmers.
-
Challenges: Despite the potential benefits, FPOs face challenges such as limited access to markets, inadequate infrastructure, lack of professional management, and difficulties in securing financing. Addressing these issues is crucial for the sustainable success of FPOs.
