Presetation on FPOs made on January, 23rd

1. Towards viable
Farmer Producer Organisations
Ramanjaneyulu

2. Farmer Producer Organisations
• A Producer Organization (PO) is a legal entity formed by primary producers, viz.
farmers, milk producers, fishermen, weavers, rural artisans, craftsmen.
• A PO can be a producer 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
member of PO
• Key promoting organizations
• NABARD: National Bank for Agriculture and Rural Development
• SFAC: Small Farmer Agribusiness Consortium
• NCDC: National Cooperative Development Corporation
• NAFED: National Agricultural Cooperative Marketing Federation of India
• NRLM: National Rural Livelihoods Mission
• Departments of Agriculture, Horticulture, AH,

3. Where do we stand?
Farmer Producer Companies as on 31st March, 2019
• a total of 7,374 (6926 active) have been registered with over estimated 4.3 million shareholders (most of whom are small and
marginal farmers)
• Maharashtra alone accounts for more than one quarter of all producer companies in India.
• The top four states, Maharashtra, Uttar Pradesh, Tamil Nadu and Madhya Pradesh, account for 50% of producer companies
registered in India
• The 7374 registered producer companies have a combined Paid-Up Capital (PUC) of about Rs. 860 crore. There are a few
companies with very large PUC and a large number of companies with very small PUC
• the PUC of top 100 companies (Rs 587 crore) accounts for more than two thirds of the total PUC of all companies and at the
other end, there are 189 companies with just Rs. 1000 or less PUC each. The median PUC is Rs. 1.06 lakh for all registered
companies and Rs. 1.10 lakh for companies with registration status as ‘active’.
• 86% of ‘active’ PCs are very small, with less than Rs. 10 lakh of paid-up capital. Only 2.6% of active companies have PUC
greater than Rs. 25 lakh.
Others
• Mutually Aided Cooperative Societies
• Primary Agriculture Cooperative Societies
• Multistate Cooperative Societies
• Others…

4. Key challenges
• Access to capital
• Long time to mature
• Lack of infrastructure and human resources
• Meagre support
• Duplication of efforts
• Weak support systems
• No better access to tenant farmers

5. Farmer Producer Organization
5
Small and marginal
farmers
Single Women
Other vulnerable
PGS/ICS Groups
Livelihood Groups
Producers
Organisation
Livelihood Portfolio
Crop production
• Grains
• Vegetables and Fruits
• Cotton
Livestock
• Poultry
• Sheep and Goat
Inputs
• Seed
• Bioinputs: compost, biofertilisers
and botanical pesticides
• Fodder
• Feed
Value addition
• Food processing
Non Farm
• Soap making etc
Main objectives
• Strengthening existing production systems
• Increasing livelihood opportunities
• Improving the backward linkages by aggregating services

6. FPO Strategy
Pathway for change
Year 01
Year 02
Year 03
Year 04
Year 05
Year 06
• Membership
• Business plans
• Financial plans
Incubation & Early Stage
• Identification, mobilisation
• Training and capacity building
• Registration, technical support,
professional management
Implementation & Growing Stage
• Growth plan
• Market access
• Regulatory requirements
• Business Management
Influence & Matured Stage
• Product development
• Business expansion
• Partnerships
• Membership
• Business plans
• Financial plans
• Membership
• Business plans
• Financial plans
• Membership
• Business plans
• Financial plans
• Membership
• Business plans
• Financial plans
• Membership
• Business plans
• Financial plans

7. Structure of FPO
Farmers Producer Organisation
General Body
(Meets once in a year)
Executive Body
(Optional body for better management)
Board of Directors
CEO/Manager
Governance Role
• Strategy planning
• Advisory
• Decision Making
Execution Role
• Planning
• Implementation
• Management
FPO Staff
Community Resource Persons
Support Role
• Extension
• Inputs
Local Enterpreneurs
Mobilisation
Capacity
building ,
forward and
backward
lingakes
Support Functions

8. 06.Access to entitlements and
support
01. Training and Advisories
▪Trainings on sustainable production
▪Surveillance and farm advisories
▪Problem Diagnostics
04.Custom hiring Services 03. Input sales
02. Access loan and insurance
05.Market Linkages
▪ Quality management for ICS/PGS
▪ Connecting to buyers
▪ Aggregation, grading and storage
Farmer Service Centers
FPOs/Farmer Service Centers

9. Producers
Organisation
Rural Enterprises: off farm, non farm
Financial Services: Credit, insurance, subsidies
Input Services: Seed, bioinputs, CHC
Quality Assurance: PGS/ICS, Traceability
Market Services: Local, trading
Legal Services : GST, IT returns
Extension Services: Trainings, Advisories
Govt Services &Entitlements: DBT, Pensions etc
Support Services for Producer Organisations
Banks
Insurance
companies
Seed
companies
Input
dealers
Departments
Traders
Extension
System
Auditors
Resource
Organisations
Local
Entrepreneurs

10. Farmer Cooperative or Producer Company
Farmer Groups
(FFS/PGS/JLG/SHG)
Farmer Groups
(FFS/PGS/JLG/SHG)
Farmer Groups
(FFS/PGS/JLG/SHG)
District Federation
Cluster Level
Village Level
District Level
Integrated Processing Units
(Grains/Pulses/Oilseeds/Spices)
Technical Support Unit
(Extension/Quality Assurance/Finance)
Marketing Unit
(Local/Domestic/international)
Shareholding
Raw produce
Support
Market Access
District level support unit
Branding Innovations Forward backward linkages

11. Financial support
• Grants
• NABARD PRODUCE
• NABARD Producer Organisation Development Fund (PODF)
• New Scheme to promote 10,000 FPOs: NABARD, NCDC, SFAC, NAFED
• Department of Agriculture/Horticulture/Marketing
• Credit
• NABKISAN
• NBFCs
• Commercial Banks

12. New Policy and Scheme
•10,000 FPOs are to be formed by 2023-24 and support to each FPO is to be
continued for 5 years.
•The cost of proposed scheme is INR 6,866 crores.
• Up to 2023-24 with budgetary support of Rs. 4,496.00 crore
• 2027-28 may need about Rs. 2,369.00
•Key Features
• Formation and promotion of FPO is based on Produce Cluster Area, supported by a
Cluster Based Business Organization (CBBO).
• CBBOs are setup/identified at the State/Cluster level to form and promote FPOs as per
their requirements
• Requirement of Feasibility study and perspective business plan to establish a fit case for
viable business proposition for FPO in the beginning.
• Attempts to strike a balance between leveraging required government support for FPOs
and trying to insulate the FPOs from undue interference from the government.
• Focus on aspirational districts, notified tribal areas and North East areas.
• a National Project Management Agency (NPMA) will be set up by SFAC

13. Support to be Available
• Support to FPOs:
• 3 years a grant of 18 lakhs (released @ Rs. 6.0 lakhs per year)
• Equity Grant:
• FPO with a minimum farmer-members’ size of 300 shall be eligible under the scheme in
plains, while in North-Eastern and Hilly areas* (including such other areas of UTs), size of 100
shall be eligible
• Matching grant up to Rs. 2000 per each farmer member with a maximum ceiling of Rs. 15.00
lakhs
• Working capital through bank loans:
• Credit Guarantee for project loan above Rs.1 crore and upto Rs.2 crore, credit guarantee
cover will be for 150 lakhs
• For project loan upto Rs.1 crore, credit guarantee cover will be for 85 lakhs
• Other Support
• Convergence with various schemes and programs of the Central and State Governments.
• NAFED to undertake price support purchase operations on its behalf
• Procurement operations by FCI and State Governments

14. Micro Small and medium enterprises
• Details of investments and turnover available on books of accounts
• Turnover details as available in the GST system
Classification Micro Small Medium
Existing New Existing New Existing New
Manufacturing
Investment <
Rs. 25 lakhs
Investment <
Rs. 1.0 Crore
Turnover
< Rs. 5.00 Crore
Investment <
Rs. 5.00 Crore
Investment <
Rs. 10.0 Crore
Turnover
< Rs. 50.00
Crore
Investment <
Rs. 10.00 Crore
Investment <
Rs. 20.0 Crore
Turnover
< Rs. 100.00
Crore
Services
Investment <
Rs. 10 lakhs
Investment <
Rs. 2.00 Crore
Investment <
Rs. 5.00 Crore

15. Salient features:
• Centrally Sponsored Scheme with an outlay of Rs. 10,000 Crore
• Expenditure to be shared by Government of India and States at 60:40.
• 2,00,000 micro-enterprises are to be assisted with credit linked subsidy for expansion and upgradation.
• Scheme will be implemented over a 5 year period from 2020-21 to 2024-25.
• Cluster approach.
• Focus on perishables
• Increased access to common services like sorting, grading, processing, packaging, storage etc.
Implementation
• Back ended credit linked subsidy will be provided to 2,00,000 units.
• Seed capital will be given to SHGs (@Rs. 4 lakh per SHG) for loan to members for working capital and small tools.
• Grant will be provided to Primary Agricultural Credit Societies (PACS), Marketing Cooperative Societies, Farmer
Producers Organizations (FPOs), Self Help Group (SHG), Farmers, Joint Liability Groups (JLG), Multipurpose Cooperative
Societies, Agri-entrepreneurs, Startups, Aggregation Infrastructure Providers and Central/State agency or Local Body
sponsored Public Private Partnership Projects
Agri infra development fund
New Scheme to support MFE

16. Who can take support?
Support to Individual micro units:
• Micro enterprises will get credit linked subsidy @ 35% of the eligible project cost with ceiling of Rs.10
lakh.
• Beneficiary contribution will be minimum 10% and balance from loan.
• On-site skill training & Handholding for DPR and technical upgradation.
Support to FPOs/SHGs/Cooperatives: (@Rs. 4 lakh per SHG)
▪ Seed capital to SHGs for loan to members for working capital and small tools.
▪ Grant for backward/ forward linkages, common infrastructure, packaging, marketing & branding.
▪ Skill training & Handholding support.
▪ Credit linked capital subsidy.
Convergence Framework
▪ Support from the existing schemes under implementation by the Government of India and State
Governments would be availed under the scheme.
▪ The Scheme would attempt to fill in the gaps, where support is not available from other sources,
especially for capital investment, handholding support, training and common infrastructure

17. Legal Compliances
Extension Services
Business Planning
Market Linkages
Financial Linkages
• Training and Capacity Building
• Weekly Farm Advisories
• Diagnostics as and when required
• Credit linkage
• Insurance
• Schemes and subsidies
• Aggregation , sorting and grading
• Bulk buyers
• Better price realisation
• 3 years business plan
• Budgeting
• Market strategies
• ROC statutory services
• Monthly GST
• Annual Returns
Basic
Support
Services
FPO Market Place
Seeds
Bioinputs
Farm Machinery
Other needed material
Farm Inputs
Farm Outputs
Fresh fruits and Vegetables
Food grains
Others
Entrepreneurship
Development
Individual and Group
• Seed Production
• Bio inputs
• Livestock
• Food processing
Organic
Certification
Quality Management
• Farms
• Wild collections
• Processing facilities
• Farm Inputs
FPO Management
FPOhub ERP
• Members manage
Inventory
• Accounts
• Reporting
Add
on

18. Kisan Business School
Participative designing |Problem solving approach
Learning-by–doing | Interactive and inclusive solutions
Season-long approach

19. eKrishi
• A Plug and Play IT platform for
managing entire supply chain
• Most of the content free for use
• Open source architecture
• Multifunctionality with single log in
• Available on all devices-mobile,
computer etc
• Can integrate with other solutions
http:www.ekrishi.net
eKrishi connect

20. Modules
• Members Management
• Quality Management
• Financial Management including
accounting
• Inventory Management
• Marketing
• Reports
Enterprise

21. Open the app and
select the crop Identify the pest or disease
Diagnosis and
advisory
Solution details
If you cant find the
problem send query
Take photo of the
plant part
Add observations
or query
Expert receives details, photos and location and
can give advisory back to user

22. Biolab, CSA Farm level Bioinputs
BioEnterprise BioEnterprise

23. What is certified?
Quality assurance for Organic integrity across
the organic/natural farming supply chains
Field/Annual Crops Wild Collections
Perennial/Orchard Crops Processing and
handling
Livestock Bee keeping
Who is certified?
Individual producer Group of producers Area
Farmer Groups: 1010 | 8142 Farmers | 4 states
PGS Regional Council

24. Organic Mandi

25. Collection Centres
• Quality
Assurance
• Aggregation
• Grading
• Transportation
Images courtesy: Be’Nishan
Producer Company

26. Farmer Service Centre

27. Custom Hiring Centres
Farm Machines | Skilled Labour | Packaged Services

28. Food Processing
Segments Primary Processing Secondary Processing Tertiary Processing
Fruits and
Vegetables
Cleaning, Cutting,
Sorting
Pulp, Flakes, Paste, Frozen,
Diced, Canned
Jams, Jellies, Chips, Ready to
Serve drinks, Indian ethnic drinks
Grains and Cereals Sorting and
Grading
Rice Puff, Flour, baby food(final
product
/ingredients)
Cakes, Biscuits, Breakfast cereals,
breads, other bakery products,
RTC/RTE products
Oilseeds Sorting and
Grading
Oil Cakes, Refined Oils Soya Oil, Olive Oil,
Mustard Oil, Blended oils,
Fortified Oil
Milk Grading and
Refrigeration
Packaged milk, Flavored milk,
Cream, Milk powder
Yoghurt, Cheese, Ice cream, Curd,
Baby food, other value added
products
Meat and Poultry Sorting and
Refrigeration
Chilled/Frozen Products Ready to Eat products
Marine Products Chilled/Frozen products Ready to Eat products

29. Food processing hub

30. Solar
power
processing
Onion Storage Banana Fibre extraction Cotton Ginning Solar Drying

31. Value
Addition

32. Sahaja Aharam
Building producers markets

33. 33
India’s first Farmer Owned Organic Retail Chain since 2009
Sahaja Aharam Producer Company is a federation of 23 organic farmer producer organizations in Andhra
Pradesh, Telangana and Maharashtra and owns end-to-end supply chain from Seed to final product sourced
from 100% certified member organic farms and processed at exclusive certified Organic Processing facilities.
Farm harvest is aggregated at FPO sorted, graded and moved to the Organic Food Hubs, processed, packed and
supplied to our distribution hubs to reach retail stores and end consumer groups
100% Organic Foods
Procured from certified organic
farmers and can be traceable to the
farmer group
Processed in Own Foodhubs
Processed at Foodhubs
exclusive Organic Foodhubs
owned by SAPCO or farmers
Ensuring Fair Trade
Shorter and efficient supply chains to
ensure that producers gets more than
50% of the consumers price
Fresh from Organic Farms
Fruits and Vegetables supplied
from farms to consumers in less
than 18 hrs from harvesting
www.sahajaaharam.com

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35. Thank you
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http://www.csa-india.org http://www.sahajaaharam.com http://www.grameenacademy.in
Call on 8500 68 3300
8500 78 3300
8500 98 3300
csa@csa-india.org
pgs@csa-india.org
info@sahajaaharam.in
organicmandi@csa-india.org
grameen@csa-india.org