Why in news?
Recently, Agriculture Minister released new operational guidelines for setting up and promotion of 10,000 FPOs in the country.
What is a Farmer Producer Organisation (FPO)?
A Farmer Producer Organisation (FPO), formed by a group of farm producers, is a registered body with producers as shareholders of the organisation. It deals with business activities related to farm produce and works for the benefit of member producers.
Problems faced by Farmer Producer Organisation (FPO)
Today the number of small and marginal farmers are rising in the country. To support such farmers, FPOs could be useful. But merely establishing the FPOs will not work, as it requires a good ecosystem to operate. These organisations face challenges such as funding, capacity building and value chain investments. Domestic policies and laws also needed to be addressed for growing the FPOs.
The success of FPO will also depend on other players such as Banks, Retailers and Corporate sector. The value chain required for the development of FPOs cannot be done by one player.
There are thousands of FPOs in the country but only a few are successful and are making money. In an FPO, business competence will develop when you have corporate skills and leadership . But most of the FPOs depend on Government programs and have no business acumen.