A Milestone in Indian Agriculture
In a landmark achievement for India’s agricultural sector, the government has successfully launched 10,000 Farmer Producer Organizations (FPOs) to empower small and marginal farmers. This initiative, introduced by Prime Minister Narendra Modi on February 29, 2020, aims to enhance farmers’ collective bargaining power, improve market access, and boost rural incomes.
With a budget outlay of ₹6,865 crore for implementation until 2027-28, the scheme is set to transform the lives of millions of small farmers by providing them with financial support, better resources, and direct market linkages.
The 10,000th FPO: A Symbol of Progress
The government marked this milestone with the launch of the 10,000th FPO in Khagaria district, Bihar, focusing on maize, banana, and paddy cultivation. The FPO was inaugurated by Prime Minister Modi during the release of the 19th installment of the PM-KISAN scheme in Bhagalpur, Bihar, further reinforcing the government’s commitment to farmer welfare.
Since the inception of the scheme, significant financial support has been provided:
- ₹254.4 crore in equity grants disbursed to 4,761 FPOs.
- Credit guarantee cover worth ₹453 crore extended to 1,900 FPOs.
- Nearly 30 lakh farmers are now part of the FPO movement, with women accounting for 40% of the membership.
These collectives are now engaging in business activities worth thousands of crores, fostering self-reliance and economic empowerment in rural India.
How FPOs are Transforming Indian Agriculture
FPOs address multiple challenges faced by small and marginal farmers, including limited access to quality seeds, fertilizers, technology, and credit. By pooling resources and working as a collective, farmers gain greater bargaining power, better input procurement, and direct market access, leading to higher incomes and improved livelihoods.
To support these organizations, the government provides:
- Financial assistance of up to ₹18 lakh per FPO over three years.
- Handholding support for five years to ensure stability and growth.
- Matching equity grants of up to ₹2,000 per farmer (capped at ₹15 lakh per FPO).
- A credit guarantee facility of up to ₹2 crore, facilitating access to institutional credit.
Digital and Financial Advancements for FPOs
To enhance their market reach and efficiency, several digital and financial support initiatives have been introduced:
- A dedicated Credit Guarantee Fund (CGF) to help financial institutions extend credit to FPOs.
- Nearly 5,000 FPOs registered on the Open Network for Digital Commerce (ONDC), allowing farmers to sell their produce online to a broader consumer base.
- A Memorandum of Understanding (MoU) between CSC SPV and the Ministry of Agriculture to transform 10,000 FPOs into Common Services Centres (CSCs). These centers will offer citizen-centric services and generate rural employment.
A Step Towards Inclusive Growth
The government’s FPO initiative places a strong emphasis on inclusivity, ensuring women, Scheduled Castes (SC), Scheduled Tribes (ST), and economically weaker sections play an active role. By encouraging participation from diverse groups, the scheme fosters social equity while strengthening India’s agricultural economy.
A Brighter Future for Indian Farmers
The launch of 10,000 FPOs marks a major step toward empowering small farmers, enhancing rural incomes, and making agriculture more sustainable. As these collectives continue to expand, they are expected to revolutionize India’s farming landscape, reducing dependency on intermediaries and improving farmers’ overall financial stability.
With continued government support and digital advancements, India’s agricultural sector is poised for unprecedented growth, making farming more profitable, organized, and resilient for future generations.
(With inputs from agencies)
