“We will enable the creation of 10,000 new Farmer Producer Organisations (FPOs) by 2022 to ensure economies of scale for farmers regarding access to inputs and markets.” — Promise in 2019 BJP Manifesto

The Government of India has launched the Central Sector Scheme for “Formation and Promotion of 10,000 Farmer Producer Organizations (FPOs)” in the year 2020 to form & promote 10,000 FPOs in the country with a total budgetary outlay of Rs.6865 Crores. The scheme was extended to 2024.

An evaluation of the links below indicates that:
1. PIB (20 Dec, 2023, Minister of Cooperation, Government of India) in press release titled “Farmer Producer Organizations (FPOs) by Primary Agricultural Credit Societies (PACS)”, the Ministry of Agriculture and Farmers’ Welfare has informed that against the target of 10,000 FPOs, 7,597 FPOs have been registered.

2. Question No. 1403 (Unstarred), Lok Sabha 17, Session 14, Ministry of Agriculture and Farmers’ Welfare, Dec 12, 2023, as on 30.11.2023, under the said scheme (“Formation and Promotion of 10,000 Farmer Producer Organizations (FPOs)”) so far, 7,597 FPOs have been registered.

3. Question No. 1452 (Unstarred), Rajya Sabha Session 262, Ministry of Agriculture and Farmers’ Welfare, Dec 15 2023, stated the following benefits observed post the formation of FPOs: Collectivization under FPOs has positively impacted members, especially small and marginal farmers in terms of:
a. Increase in productivity: The farm productivity of the member farmers is enhanced substantially. The crop productivity has increased ranging from 18.75% to 31.75%.
b. Value addition to make agri produce marketable: The farmers took up primary value addition of agri produce like cleaning, drying and grading to realise better price compared to raw produce.
c. The primary producers through produce aggregation have enhanced their bargaining power. This has enabled them to take advantage of economies of scale and attracted traders to collect produce at farm gates.
d. Reduction in post-Harvest Losses: Post-harvest losses were minimized with increased self-life through value addition and efficient management of agri supply value chain.
e. Reduction in input cost: The input cost was reduced on an average in the range of ₹50 to ₹100 per bag of seed and fertilizer.
f. Storage facilities: Accessibility of storage facilities enabled farmers to avoid distress sale of produce thereby ensuring better price and increase in income.
g. Reduction in transport cost: Aggregation of produce and bulk transport of inputs and outputs reduces marketing cost, thus enhancing net income of the producer.
h. Undertaking activities like seed production, bee keeping, mushroom cultivation etc. with a higher margin than traditional business has resulted in higher income.
i. Post-FPO formation, annual income growth per acre was observed to be in the range of Rs.4000 to Rs.30500/- in absolute terms and 14% to 60% in relative terms.

It can therefore be concluded that:
The Government’s objectively verifiable performance can be graded as 76% (Medium-High) based on the creation of 7,597 FPOs (against the promise of 10,000 FPOs) with benefits observed from the formation of FPOs established.