unacademy 10th January 2019 Important Editorial Discussion(Farmer Producer Bodies Need Help Presented By: - Prabhakar Jha
Agriculture provides livelihoods to millions of small landholders in India. provide direct cash transfer to farmers based on their landholding addresses only a part of the issue. A long-term solution to address farmers' distress is the need of the hour. Organizing farmers into farmer producer organizations (FPOs) could be one feasible
What are FPOs? A Producer Organisation (PO) is a legal entity formed by primary producers, viz. farmers, milk producers, fishermen, weavers, rural artisans, craftsmen. PO is a generic name for an organization of producers of any produce, e.g., agricultural, non- farm products, artisan products, etc. A PO can be a production company, a cooperative society or any other legal form which provides for sharing of profits/benefits among the members. In some forms like producer companies, institutions of primary producers can also become a member of PO. The concept of 'Farmer Producer Organizations, (FPO)' consists of collectivization of producers especially small and marginal farmers so as to form an effective alliance to collectively address many challenges of agriculture such as improved access to investment, technology, inputs, and markets. FPO is one type of PO where the members are farmers.
FPOs started taking shape in the country in the recent decade, where 80-90 percent of the members are farmers with small landholding. According to a 2017 NABARD publication, around 5,000 FPOs are operating in the country, which was formed under various initiatives of the Central Government (including Small Farmers Agribusiness Consortium), State governments, NABARD, and other organizations. Of these, around 3,200 FPOs are registered as farmer producer companies and the remaining as cooperatives/societies, etc. However, the beginnings of FPOs have been rather modest and membership is at five lakh only. Status of FPOs
Importance of FPOs Well-organized FPOs engage in providing a range of assistance to farmers Iike imparting better farm practices, collectivization of input purchases, transportation, linkage with markets, and better price realization as they do away with the intermediaries. A direct selling arrangement provided by FPOs can reduce the cost of marketing by linking farmers more closely to the supply chain and consumers. A few FPOs like SFPCL, Savitribai Phule Goat Farming Producer Company and Vasundhara Agri-Horti Producer Company have made notable achievements in crop production and allied farm activities; improving quality of production through best farm practices; tapping the unexplored markets; cutting down the intermediaries in the agri value chain, and enhancing farmers income. Some of the best practices followed by the FPOs include maintaining crop maturity indices, documenting plant
Issues . While resource agencies (RAs) normally have social mobilization skills, they lack business development and marketing skills, which are critical for the success of FPOs as a business entity *Focus on management capabilities in the supply chain operations, nuances of market dynamics and inkages, business planning according to market intelligence and market development is clearly missing in the majority of the training programmes associated with FPOs. The present system su ers from distortions like multiple ntermediaries and levies, lack of vertical integration (is the combination in one firm of two or more stages of production normally operated by separate firms), poor infrastructure, restrictions on the movement of aaricultural commodities, and so on
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