7,597 FPOs Registered in India, Achieving 75% of Govt's 10,000 Target by 2024

In an excellent development for Indian agriculture, a whopping 7,597 Farmer Producer Organisations (FPOs) have been successfully registered in the country as of November 30 this year. This accomplishment represents a remarkable 75% achievement of the government's ambitious goal to establish and support 10,000 FPOs nationwide by 2024.

This positive shift is a result of a 2020 initiative by the Indian government, which earmarked Rs 6,865 crore to boost the creation of FPOs. The primary objective of this scheme was to empower farmers by boosting their bargaining power, capitalizing on economies of scale, cutting down production costs, and ultimately elevating their incomes through the collective sale of agricultural produce.

Breaking down the numbers, Uttar Pradesh takes the lead with approximately 1,150 registered FPOs, followed by Madhya Pradesh (566), Maharashtra (521), Punjab (475), and Bihar (474).

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A study conducted by the National Bank for Agriculture and Rural Development (NABARD) in 2020-21 and 2021-22 further illuminates the positive impact of FPOs. Farmers associated with these organizations experienced a significant 18.75% to 31.75% increase in productivity, coupled with a notable reduction in input costs ranging from Rs 50 to Rs 100 per bag of seed and fertilizer.

The study also highlights the effectiveness of FPOs in enhancing the livelihoods of small and marginal farmers. Collectivization under FPOs has proven to positively influence members, minimize post-harvest losses, and provide crucial support in storage facilities, preventing distress sales and ensuring better prices, ultimately leading to increased income.

Highlighting success stories, the study points out that FPO membership has translated into higher average price realization for farmers in Kerala, Madhya Pradesh, Odisha, and Rajasthan. Moreover, the aggregation of produce and streamlined transport of inputs and outputs have not only reduced marketing costs but have also led to higher net income for producers.

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Under the FPO Scheme, the government extends financial assistance of 1.8 million per FPO for three years, with an additional Rs 2.5 million granted to Cluster Based Business Organisations. FPOs are formed and promoted through nine implementing agencies, including the Small Farmers Agri-Business Consortium (SFAC), National Cooperative Development Corporation (NCDC), and NABARD. These agencies engage Cluster-Based Business Organisations to aggregate, register, and provide professional support to FPOs for five years. FPOs in India are deliberately expanding and represent a tangible improvement in the lives of farmers, their productivity, and the overall prosperity of the agricultural sector.

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