50% of FPOs are potentially viable and efficient but lacking financial support: MD, SFAC

50% of FPOs are potentially viable and efficient but lacking financial support: MD, SFAC
These FPOs have the potential to be viable entities, but the biggest challenge they are confronted with is lack of finance from banks, the senior bureaucrat with the Government of India said

Small Farmers’ Agri-business Consortium (SFAC) under the aegis of Ministry of Agriculture & Farmer Welfare, Government of India, has informed that more than 50 per cent farmer producer organisations (FPOs) promoted by SFAC under various government programmes are potentially viable and efficient while some others are in nascent stages of development. It is expected that given the right ecosystem support, especially infusion of capital in agri-infrastructure through credit mobilisation from banks and NBFCs, they could be a real game-changer and contribute to increasing the income of member farmers substantially.

Speaking at a national workshop on ‘Strengthening Ecosystem of Farmers’ Producer Organisations’ held in New Delhi, Neelkamal Darbari, Managing Director, Small Farmers’ Agri-business Consortium said, “The government has taken up the very challenging cause of creating financial and marketing linkages for aggregation of farmers through a Central sector scheme for creation of 10,000 FPOs across the country. The scheme is under implementation through different implementing agencies, who have already created more than 1,770 FPOs.”

“These FPOs have the potential to be viable entities, but the biggest challenge they are confronted with is lack of finance from banks. Most banks do provide crop and tractor loans but are reluctant to provide capital finance for asset formation and infrastructure development in the agriculture sector. This lack of capital support hinders the small and marginal farmers of FPOs from availing benefits of technological innovations like protected cultivation, micro-irrigation systems or next-gen mechanisation. This approach of rural branches and banks must change in order for the evolution of sustainable practices in the agriculture sector,” she further said.

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“The top management of banks are always favourably inclined towards enhancing credit support investment in agriculture, but somehow at the branch level in rural areas, there are challenges for FPOs. As such SFAC is trying to engage with the banks for rural branches to improve credit flow to FPOs created under the new government scheme for promotion of 10,000 FPOs,” she added.

Speaking at the event RG Agarwal, Group Chairman, Dhanuka Agritech, expressed concern about the spurious agriculture inputs. “There is little difference in the area under cultivation between India and China, but China’s agriculture GDP is three times higher than India mainly because of quality products used in China as against India wherein a large chunk of products are spurious in nature, resulting in lower production. It is the need of the hour to take strict action against spurious manufactures of fertilisers and pesticides.”

The day-long workshop was organised by the Confederation of NGOs of Rural India (CNRI) and supported by Dhanuka Agritech; Institute of Rural Management Anand (IRMA); Central for Political Studies, JNU and Vaikunth Mehta National Institute of Cooperative Management (VAMNICOM).

Several experts believed adequate knowledge, right inputs and robust marketing infrastructure too may play a critical role in doubling the income of farmers and promoting prosperity in rural India.

During the workshop, Binod Anand, Secretary-General, CNRI; Dr. Surendra Nath Tripathi, DG, IIPA; Dr. KK Tripathy, OSD, Minister of Cooperation; Arun Raste, MD & CEO, NCDEX; S Sivakumar, Group Head, ITC, Agri & IT Business; Hema Yadav, Professor & Director, VAMNICOM; Sachin Sharma, Associate Professor and Sushil Singla, Principal Resident Commissioner, Government of Himachal Pradesh among others expressed their thoughts on various issues related to farmers and FPOs.

Many farmers were also present on this occasion and an open house was also conducted wherein their queries were answered.

Photo caption: Neelkamal Darbari, MD, SFAC at a workshop on Strengthening Ecosystem of FPOs along with other participants in New Delhi

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