Farmer producer organisations (FPOs) have been functioning in India for over 20 years, with the aim of helping small farmers improve their market standing by negotiating collectively. FPOs can be registered as a farmer producer company (FPC) or a cooperative. In 2019, the Government of India launched a scheme called Formation and Promotion of 10,000 Farmer Produce Organisations, with the goal of establishing 10,000 new FPOs in the country by 2024. The scheme is implemented through nine agencies, including the Small Farmers Agri-Business Consortium (SFAC), National Cooperative Development Corporation (NCDC), and National Bank for Agriculture and Rural Development (NABARD). As part of the scheme, cluster-based business organisations (CBBOs) are engaged to aggregate, register, and provide support to FPOs for a period of five years. CBBOs act as a platform for end-to-end knowledge on FPO promotion. Any legal entity registered in India for the past three years is eligible to be a CBBO. The agency should have a minimum average turnover of at least Rs 2 crore for the plains and Rs 1 crore for the Himalayan and northeastern regions in the past three years, with a positive net worth. Institutions promoted by public sector agricultural universities, Indian Council of Agricultural Research, or other similar institutions are exempt from this requirement. CBBOs receive payment of Rs 25 lakh per FPO over five years from the implementing agencies for the costs incurred in the formation and incubation of the FPOs. The process of creating an FPO starts with CBBOs identifying a produce cluster area and conducting a feasibility survey. They then mobilize potential producers, share the business idea, and prepare a business plan in collaboration with farmer members. The business plan covers the entire value chain, from production to marketing, value addition, and exports. The Small Farmers Agri-Business Consortium (SFAC) is tasked with facilitating the formation of FPOs and supporting state governments in the process. CBBOs are required to form an FPO with a minimum of 300 farmer members in the plains and 100 farmer members in hilly and northeastern regions to be eligible under the scheme. As of June 30, 2022, around 535 FPOs have been registered under the scheme, with approximately 55 CBBOs acting as promoting or consulting agencies. Notable CBBOs include Grant Thornton Bharat LLP, Pricewaterhouse Coopers Pvt Ltd, Isha Outreach, Star Agriwarehousing, and ITC Ltd. In February 2023, there were a total of 16,000 FPCs in the country, with the majority registered in the last three years. Despite the challenges posed by the COVID-19 pandemic, the registration of FPCs has seen a significant increase, with 6,000 FPCs registered in 2020-2021 alone. The growth of FPOs and FPCs reflects the efforts to empower small farmers and enhance their participation in the agricultural market in India.

Farmer producer organisations (FPOs) have been functioning in India for over 20 years, with the aim of helping small farmers improve their market standing by negotiating collectively. FPOs can be registered as a farmer producer company (FPC) or a cooperative. In 2019, the Government of India launched a scheme called Formation and Promotion of 10,000 Farmer Produce Organisations, with the goal of establishing 10,000 new FPOs in the country by 2024. The scheme is implemented through nine agencies, including the Small Farmers Agri-Business Consortium (SFAC), National Cooperative Development Corporation (NCDC), and National Bank for Agriculture and Rural Development (NABARD). As part of the scheme, cluster-based business organisations (CBBOs) are engaged to aggregate, register, and provide support to FPOs for a period of five years. CBBOs act as a platform for end-to-end knowledge on FPO promotion. Any legal entity registered in India for the past three years is eligible to be a CBBO. The agency should have a minimum average turnover of at least Rs 2 crore for the plains and Rs 1 crore for the Himalayan and northeastern regions in the past three years, with a positive net worth. Institutions promoted by public sector agricultural universities, Indian Council of Agricultural Research, or other similar institutions are exempt from this requirement. CBBOs receive payment of Rs 25 lakh per FPO over five years from the implementing agencies for the costs incurred in the formation and incubation of the FPOs. The process of creating an FPO starts with CBBOs identifying a produce cluster area and conducting a feasibility survey. They then mobilize potential producers, share the business idea, and prepare a business plan in collaboration with farmer members. The business plan covers the entire value chain, from production to marketing, value addition, and exports. The Small Farmers Agri-Business Consortium (SFAC) is tasked with facilitating the formation of FPOs and supporting state governments in the process. CBBOs are required to form an FPO with a minimum of 300 farmer members in the plains and 100 farmer members in hilly and northeastern regions to be eligible under the scheme. As of June 30, 2022, around 535 FPOs have been registered under the scheme, with approximately 55 CBBOs acting as promoting or consulting agencies. Notable CBBOs include Grant Thornton Bharat LLP, Pricewaterhouse Coopers Pvt Ltd, Isha Outreach, Star Agriwarehousing, and ITC Ltd. In February 2023, there were a total of 16,000 FPCs in the country, with the majority registered in the last three years. Despite the challenges posed by the COVID-19 pandemic, the registration of FPCs has seen a significant increase, with 6,000 FPCs registered in 2020-2021 alone. The growth of FPOs and FPCs reflects the efforts to empower small farmers and enhance their participation in the agricultural market in India.