Formation & Promotion of 10,000 Farmer Producer Organizations (FPOs)

In News –

Union Ministers of State for Agriculture and Farmers Welfare inaugurated professional training programmes designed and developed for CEOs, Board of Directors, Accountants of FPOs.

• It was done on the occasion of the anniversary of the Central Sector Scheme titled ‘Formation and Promotion of 10,000 Farmer Produce Organizations (FPOs)’.

About Scheme –

• It was launched by the Prime Minister in February 2020 at Chitrakoot (Uttar Pradesh) with a budgetary provision of Rs 6865 crore.
• Under the scheme, FPOs are to be developed in production clusters, wherein agricultural and horticultural products are grown/cultivated for leveraging economies of scale and improving market access for members.
• The scheme intends to bring more and more small and marginal farmers on a bigger platform as a joint entity to help them become ‘Atma Nirbhar’ (self-reliant) in the long run.
• At the National level, National Project Management Agency (NPMA) as a professional organization has been engaged in providing overall project guidance, coordination, a compilation of information relating to FPOs, maintenance of MIS and monitoring purpose.

Features –

• There are well-defined training structures in the scheme and the institutions like Bankers Institute of Rural Development (BIRD), Lucknow and Laxmanrao Inamdar National Academy for Co-operative Research & Development (LINAC), Gurugram have been chosen as the lead training institutes for capacity development & training of FPOs.
• FPOs will be provided financial assistance up to Rs 18.00 lakh per FPO for a period of 03 years.
•  In addition to this, provision has been made for matching equity grant up to Rs. 2,000 per farmer member of FPO with a limit of Rs. 15.00 lakh per FPO and a credit guarantee facility up to Rs. 2 crores of project loan per FPO from the eligible lending institution to ensure institutional credit accessibility to FPOs

Objectives –

• To provide small and marginal farmers “better collective strength for better access to quality input, technology, credit and better marketing access through economies of scale for better realisation of income”.

Significance –

• The formation of the FPOs scheme will promote the selling of farmers produce from the farm gate of farmers.
  • This will shorten the supply chain and accordingly marketing cost will get reduced resulting in better income for farmers.
•  It will accelerate more investment in marketing and value addition infrastructure near to farm gate creating more employment opportunities for rural youth.

Progress-

• More than 2200 FPOs produce clusters have been allocated for the formation of FPOs in the current year, of which 100 FPOs for specialized Organic produce, 100 FPOs from Oilseeds & 50 commodity-specific FPOs with value chain development will be formed.
• In addition to SFAC, NABARD & NCDC, 06 more implementing agencies have been approved for the formation and promotion of FPOs.
• Implementing Agencies (IAs) are engaging Cluster-Based Business Organizations (CBBOs) to aggregate, register & provide professional handholding support to each FPO for a period of 5 years.
  •  CBBOs will be the platform for an end to end knowledge for all issues related to FPO promotion.

Source: PIB