Context: 

Recently, the Central government achieved the target of establishing 10,000 Farmer Producer Organisations (FPOs) under the Formation and Promotion of 10,000 FPOs Scheme.

More on the News

• The 10,000^th FPO has been registered in Khagaria district and focuses on maize, banana, and paddy.
• Central Government had announced in the Union Budget 2019-20 its intention to form 10,000 new FPOs by 2023-24.

Farmer Producer Organisations (FPOs)

• FPOs are incorporated/ registered either under Part IXA of the Companies Act or under the Co-operative Societies Act of the concerned States and formed for the purpose of leveraging collectives through economies of scale in the production and marketing of produce from agricultural and allied sectors.
• FPOs provide small farmers with direct access to significant market benefits, bargaining power and improving market access.
• FPOs help in collectivization of such small, marginal and landless farmers in order to give them the collective strength to deal with issues (access to technology, quality seed, fertilizers and pesticides). 

Formation and Promotion of 10,000 FPOs Scheme

It is a Central Sector Scheme launched by the Prime Minister of India on 29th February, 2020 with a budget outlay of ₹6,865 Crore till 2027-28.

Approximately 30 lakh farmers (40 percent of them being women) in the country are associated with FPOs.

The scheme functions under the Union Ministry of Agriculture & Farmers Welfare.

The following ministries/organisations support the schemes for different aspects

• Ministry of Agriculture & Farmers Welfare: Supports FPOs in getting seed, pesticides and fertilizer licenses, and in providing dealerships through Agri Input companies.
• Ministry of Food Processing: It provides credit-linked capital subsidy @ 35% of the eligible project cost and 50% financial grant for branding and marketing.
• Ministry of Micro & Small Enterprises: It provides access to funds in the form of FPO management cost, equity grant and credit guarantee facility apart from capacity building training, marked and credit linkages.
• Ministry of Fisheries, Animal Husbandry, and Dairying: Supports Dairy Cooperatives and farmer-producer organizations engaged in dairy activities.
• APEDA (Agricultural & Processed Food Products Export Development Authority): Provides assistance to APEDA registered FPOs for export and MSME under its scheme of Fund for Regeneration of Traditional Industries (SFURTI).
• Spices Board: Support FPOs under the Spice Sector through Progressive, Innovative and Collaborative Interventions for Export Development (SPICED) scheme.

Key objectives of the Scheme

• To provide handholding and support to new FPOs up to five years from the year of its creation in all aspects of management of FPO.
• To help FPOs in developing agriculture entrepreneurship skills to become economically viable and self-sustaining beyond the period of support from the government.

Current Overview of the Scheme

Since the launch of the scheme, ₹254.4 Crore in equity grants has been released to 4,761 FPOs and credit guarantee cover worth ₹453 Cr. has been issued to 1,900 FPOs.

• As of Feb 2025, Uttar Pradesh has the highest number of registered FPOs (758) of FPOs followed by Madhya Pradesh (348).

As of 2024, 810 FPOs have been registered as 100 percent women member FPOs under the scheme.