NEW DELHI: The government is aiming to meet the target of 10,000 new farmer producer organisations (FPOs) by the end FY25, five years after the launch of the central sector scheme.
Sources told FE that over 9,268 FPOs have been registered as cooperatives and producers’ companies under a central sector scheme — formation and promotion of 10,000 FPO – launched in 2020 with a budgetary provision of Rs 6,865 crore. Registration of 732 such collectives are awaited.
Formation of these collectives are aimed at boosting farmers’ income through aggregation of their agricultural produce, improving market access and bulk suppliers of various agri-inputs thus reducing cost of cultivation.
Officials said while the scheme was to be implemented till end of FY25, the financial assistance provided to FPOs will continue beyond current fiscal as a chunk of farmers collectives have been formed in the last couple of years.
An estimated 33 lakh farmers have taken equity in these farmers collectives across states. These FPOS have a combined turnover of over Rs 1,300 crore and the government has infused R 450 crore as matching equity in these collectives.
Out of these over 3832 collectives have been provided with licenses for selling seeds while 3461 FPOs have fertiliser licenses. Close to 3000 such entities have received approval for selling pesticides while 700 FPOs have mandi licenses.
Fourteen agencies including Nabard, Small Farmers’ Agri-business Consortium, Nafed and National Cooperative Development Corporation have been assigned to form FPOs.
Under the agriculture ministry’s scheme, the farmers’ collectives are provided financial assistance up to Rs 18 lakh per FPO for a period of three years. In addition, provision has been made for matching equity grants up to Rs 2,000 per farmer member of an FPO with a limit of Rs 15 lakh per FPO.
In addition, over 8600 farmers’ collectives across states are able to sell unique agricultural products – rice, pulses, millets, honey, mushroom, spices and value-added products on the government’s e-commerce platform — Open Network for Digital Commerce (ONDC).
In addition, farmers are buying agricultural inputs like seeds, pesticides and herbicides online using the platform as several agencies such as National Seed Corporation, inputs manufacturer and FPOs with fertiliser license are on board of it.
ONDC is being promoted as an alternative to global e-commerce giants such as Amazon and Walmart, supporting small enterprises. ONDC supports and trains FPOs, free registration, in developing and digitisation of product catalogues, generating shipping labels, identifying delivery partners and facilitating digital payments so that they leverage the platform for marketing of their product.
Since the formation of Aryahi Fed Farmers Producer Company, a Saharanpur, Uttar Pradesh based collective of 673 farmers in 2021, the collective is aiming to achieve a sales turnover of Rs 3 crore in the current fiscal.
“We have sold over Rs 2.5 crore worth of various honey and millet-based products so far both on ONDC and offline and we will be setting up an export-oriented honey processing unit in March,” Mayank Upadhaya, CEO, Aryahi Fed, told FE.
The ONDC network has more than 30 digital applications including Mystore, PayTM, Magicpin, and Delhivery, covering intercity logistics, and platforms for buyers and sellers.
Gujarat’s Pattan district based Banas Farmers Producer organisation, with 1643 members which supplies spices based products to various corporates like ITC, Reliance Retail, Iffco Kisan etc is aiming to clock a sales turnover exceeding Rs 10 crore in FY25, an increase from Rs 7.25 crore in 2023-24. “We have been focussing on manufacturing and selling – jeera, dhania and several other varieties of spices,” Dilip Kumar Suthar, CEO, Banas FPO, said.
Currently, there are estimated to be around 40,000 farmers collectives in operations.
The agriculture ministry’s scheme also entails a credit guarantee facility up to Rs 2 crore of project loan per FPO while Rs 25 lakh per FPOs is provided to cluster – based business organizations for five years to boost marketing of products.
Source: The Financial Express