SFAC's Schemes Empowering Farmer Producer Organisations
Rural & Marketing|April 2017

Small Farmers’ Agri-Business Consortium rolls out the Equity Grant and Credit Guarantee Funds Scheme in several states including Rajasthan. Schemes aims to provide greater strength to Farmer Producer Organisations(FPOs). R&M Reports

Farmers fraternity cannot progress if they do not consolidate their positioning in the economy with the latest trends and techniques. With this assumption, Farmer Producer Organisation(FPO) came into existence and positive outcomes are not far to see. Strengthening the FPOs is the main challenge for empowering the farming community of the country and several schemes have been launched to support them.

An FPO is company set up by producers of agricultural commodities, and is typically promoted by farmers, run by farmers and for the benefit of farmers. The objective of such a firm is to improve returns to farmers through collective input purchases and collective marketing besides enhancing quality by increasing productivity through better inputs, and increasing the knowledge base of farmers.

According to Agriculture Ministry officials, the basic objective of the FPO concept is to link small farmers to technology as well as to the markets in association with private, corporate or cooperative sector and if necessary, by providing backward and forward linkages. That is where the need comes to bring in corporate structure to induce governance and monitoring.

It is widely admitted that the major weakness of FPOs is lack of awareness about the concept among producers, corporate sector, input suppliers, commercial banks, district level and agriculture department officials. Several reports suggested that major hurdles lie in complex requirements, ranging from registration to annual filing of information, lack of access to capital, particularly working capital, need for both backward and forward linkages. Besides, policies that impede the growth of FPOs are mandi laws, cooperative regulation, tenancy provisions, among other factors.

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