A Farmer Producers Organisation (FPO) is a team of marginal and small farmers keen on improving their farming efficiency and profitability. FPO registrations help farmers by offering services including better market access, technical support and economic aid. This article will outline the eligibility requirements for forming an FPO in India.
What is an FPO?
An FPO is a group of growers which works to enhance agriculture activities. Joining forces can assist farmers through:
- Improve their bargaining power.
- Buy much better seeds and fertilisers.
- Access technical knowledge and training.
- Market their produce much better.
- Increase their gross income & stability.
Why Form an FPO?
Benefits of forming an FPO are:
- Better Bargaining Power: A group of farmers could negotiate better rates for their inputs (seeds, fertilisers) and outputs (plants).
- Access to Quality Inputs: FPOs can buy quality inputs in bulk at lower prices.
- Tech Support: FPOs might offer members access to modern farming techniques and training.
- Marketing Support: FPOs market the produce direct to buyers removing middlemen.
- Financial Supports: FPOs can get government grants and loans easier than individual farmers.
Who Can Form an FPO?
Farmers should meet specific eligibility requirements recommended by the Ministry of Agriculture and farmers Welfare in India to form an FPO. The important requirements are the following:
1. Group of Farmers:
- More than eleven farmers may form an FPO.
- Ten or more producers with a minimum paid-up capital of 1 lakh can also form an FPO.
2. Membership:
- Farmers joining the FPO have to be small or marginal Farmers. That typically means farmers having landholdings of two hectares or less.
- Members must live in the same district or village to ensure the FPO operates locally.
- The farmers should plant The same or similar crops to benefit from collective buying and marketing.
3. Legal Registration:
- The FPO has to be registered with the government under the Companies Act of 2013 or the State Cooperative Societies Act.
- The FPO has to have more than ten and maximum 500 members.
4. Operational Area:
- The area of operation of an FPO shall be 500 hectares. This supplies the FPO with a sufficient agricultural base from which to operate.
How to Register an FPO
Given below is the process for FPO registration:
1. Pick a Name: First, choose a name for the FPO. This name will be used for all legal and business pursuits.
2. Prepare Documents:
– Collect identification, land ownership and address proof of all members.
– Prepare the FPO’s bylaws and articles of association describing the organisation’s objectives and rules.
3. Register with Government:
– The FPO has to be registered with The Registrar of Companies (ROC) under the Companies Act of 2013 or The Registrar of Cooperative Societies under the State Cooperative Societies Act.
– The registration procedure entails submitting the documents and paying the registration fee.
4. Professional Management:
– For the very first 5 years the FPO has to be run by a professional company organisation. This assists in setting up the FPO and running it correctly.
– The government contributes financially to cover the expenses of establishing the FPO (including the registration fee and the legal formalities).
Government Aid for FPOs
The Indian Government supports the formation and growth of FPOs through agencies and schemes:
1. Small Farmers Agribusiness Consortium SFAC:
SFAC assists state governments in forming and promoting FPOs. They guide and help new FPOs with financial assistance.
2. National Cooperative Development Corporation (NCDC):
NCDC assists in forming and promoting FPOs under the Central Sector Scheme. They are responsible for implementing government schemes and financial support.
3. National Bank for Agriculture and Rural Development (NABARD):
NABARD finances FPOs with grants and loans. They also offer guidelines and instructions to help FPOs succeed.
4. Government Grants & Schemes:
– Equity Grant scheme: matching Equity Grants up to 10 lakhs to registered FPOs.
– Credit Guarantee Fund scheme: This Scheme offers Credit guarantees to lending institutions as much as 85% on loans not exceeding hundred lakhs. This makes loans easier for FPOs.
The Benefits of Forming an FPO
Given below are the benefits of forming an FPO:
- Economic Stability: By combining resources and working in concert, farmers could easily become self-sustainable and secure economically.
- Better Market Access: FPOs help growers sell their products in bigger marketplaces at better prices and without reliance on local traders.
- Accessing Technology: FPOs give members access to modern farming techniques and technologies.
- Financial Benefits: FPOs can access various government grants and loans that lower the economic burden on individual farmers.
- Collective Bargaining: FPOs can negotiate better deals on inputs and produce at higher prices.
Conclusion
A really major step towards enhancing the livelihoods of marginal and small farmers is forming an FPO. Collectively, farmers can attain better prices, quality inputs and financial and technical assistance.
Eligibility requirements for creating an FPO are meant to help these organisations become beneficial and effective for their members. With proper government assistance and guidelines, establishing an FPO could be a game changer for farmers and boost production, profitability and financial stability.
FAQs
Who can apply under the FPO scheme?
Smaller and marginal farmers having 2 hectares or smaller landholdings, living in the exact same district or town and growing similar crops are eligible for the FPO scheme. They must have eleven members to register an FPO.
What are the requirements for FPO registration?
Farmers should form a group of eleven members or ten producers with a paid-up capital of 1 lakh to register an FPO. The FPO has to be incorporated under the Companies Act of 2013 or the State Cooperative Societies Act and run on a minimum area of 500 hectares.
What is the criteria for a producer company?
A producer company must have ten primary producers and 1 lakh paid up capital. It has to be registered under the Companies Act and carry on operations including production, marketing, handling, pooling, pooling, grading, procurement, harvesting, selling and export of main produce.
How many farmers have to be for the FPO?
The number of farmers needed to create an FPO is eleven. However, NABARD guidelines call for 200 farmers in plain places and 100 farmers in hilly or northeastern areas as minimum members.
What is FPO for farmers?
An FPO is a team of marginal and small farmers that come together to enhance their farming practices, obtain better inputs, get professional support and promote their produce much better. It improves their negotiation power and profitability.
What makes FPO distinct from a producer company?
An FPO is a team of farmers serious about enhancing their agricultural pursuits and access to markets. A producer company is a legitimate entity incorporated under the Companies Act and engaged in production. Only some producer companies are FPOs and only a few FPOs are registered producer companies.
