New Delhi: Almost 5,000 out of 8,000 registered farmer producer organisations (FPOs) have registered on the Open Network for Digital Commerce (ONDC) portal for selling their produce online to consumers across India. The onboarding of FPOs on the ONDC Network to reach out to their buyers in any part of the country is in line with the Central government’s objective of providing growers with better market access. The move aims to empower FPOs with direct access to digital marketing, online payment, business-to-business and business-to-consumer transactions, Ministry of Agriculture & Farmers Welfare, Government of India informed in a press statement today.
Over 8,000 FPOs have been registered against the government target of 10,000 under a new Central sector scheme titled ‘Formation and Promotion of 10,000 Farmer Produce Organizations (FPOs)’ launched in 2020 with a budgetary provision of Rs 6,865 crore. Aggregation of small, marginal and landless farmers into FPOs helps enhance economic strength and market linkages of farmers for enhancing their income. FPOs facilitate farmers with access to improved technology, credit, better input and more markets to incentivise them to produce better quality commodities, the ministry said.
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Under the scheme, Government of India provides financial assistance up to Rs 18 lakh per FPO for three years. In addition to this, the government has made a provision for matching equity grants up to Rs. 2,000 per farmer member of FPO with a limit of Rs. 15 lakhs 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. So far, a credit guarantee has been issued to 1,101 FPOs worth guaranteed coverage of Rs 246 crore covering more than 10.2 lakh farmers. A matching equity grant amounting to Rs 145.1 crore has been transferred directly to the bank account of the eligible 3,187 FPOs, the agriculture ministry further informed.
Formation and promotion of FPOs aims to convert Krishi (agriculture) into Atmanirbhar Krishi (self-reliant agriculture). The initiative enhances cost-effective production and productivity and higher net incomes for the members of the FPO. It also improves the rural economy and creates job opportunities for rural youths in villages. This was the major step towards improving farmers’ income substantially, the statement reads.
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Farmer producer organisations (FPOs) are to be developed in produce clusters, wherein agricultural and horticultural produce are grown and cultivated for leveraging economies of scale and improving market access for members. ‘One District One Product (ODOP)’ cluster to promote specialisation and better processing, marketing, branding and export. Further, agriculture value chain organisations forming FPOs and facilitating 60 per cent of market linkages for members’ produce, the ministry said.
Key objectives of the scheme
- To provide a holistic and broad-based supportive ecosystem to form new 10,000 FPOs to facilitate the development of sustainable income-oriented farming and for overall socio-economic development and wellbeing of agrarian communities.
- To enhance productivity through efficient, cost-effective and sustainable resource use and realise higher returns through better liquidity and market linkages for their produce and become sustainable through collective action.
- To provide handholding and support to new FPOs up to five years from the year of creation in all aspects of management of FPO, agri-inputs, production, processing and value addition, market linkages, credit linkages and use of technology.
- To provide effective capacity building to FPOs to develop agriculture-entrepreneurship skills to become economically viable and self-sustaining beyond the period of support from the government.
- FPOs can be registered either under Part IXA of the Companies Act or under cooperative societies.
