FORMATION & NURTURING OF FARMER PRODUCER ORGANIZATION (FPO)

FPO stands for Farmers Producers Organisation. It is an organisation of farmer-producers that provide support to small farmers with end-to-end services covering almost all aspects of cultivation from inputs, technical services to processing and marketing. The main aim of FPO is to ensure better income for the producers through an organization of their own. Small producers do not have the volume individually (both inputs and produce) to get the benefit of economies of scale. Besides, in agricultural marketing, there is a long chain of intermediaries who, very often work non-transparently, leading to the situation where the producer receives only a small part of the value that the ultimate consumer pays. Through aggregation, the primary producers can avail the benefit of economies of scale. They will also have better bargaining power vis-à-vis the bulk buyers of produce and bulk suppliers of inputs. The ownership of the FPO is with its members. It is an organization of the producers, by the producers and for the producers.

Himalayan Jyoti Samiti is implementing Formation & Nurturing of Farmer Producer Organization (FPO-1) project, since April 2019 & another FPO-2 project, since Jan 2020 in 90 villages of Chakrata block of district Dehradun, funded by NABARD.

Main objectives of the project are:

1. Mobilizing small farmers in groups at the village level and build their FPO.

2. Federating point to plan and implement product specific cluster/ commercial crop cycles strengthen farmer capacity through agricultural best practices for enhanced productivity.

3. Ensuring access to and usage of quality inputs and services for intensive agriculture enhancing cluster competitiveness

4. Facilitate access to fair & remunerative markets including linking producer groups to marketing opportunities by market aggregators.

5.      Credit access from financial institution for expanding business of FPO

6.      Creation of infrastructure

7.      Developing commodity based value chain and value addition of produces

8.      Strengthen the backward and forward linkages

9.      Convergence of various schemes of government and others

10.     Make FPO a successful & replicable model

 

Himalayan Jyoti Samiti, formed one FPO in 2019 & registered it under Companies Act 2013 (18 of 2013) called “Jaunsar Kissan Producer Company Limited” which was incorporated on 28th August 2019 & another FPO in Jan 2020, which was also registered under Companies Registration Act 2013 & is called “Pandav Lok Kisan Producer Company Ltd”. Both are basically engaged in procurement of organic farm products like spices, pulses & vegetables and marketing the same after grading, processing & value addition activities. Below table describes the basic profile features of the both FPOs.

 

SN	Particulars	Jaunsar Kissan Producer Company Limited	Pandav Lok Kisan Producer Company Limited
1	Date of Registration	28th August 2019	13th October 2020
2	Registered under Act	Companies Act 2013	Companies Act 2013
3	Total Board of Directors	10	10
4	No. of villages linked	59	31
5	Total No. of shareholders registered	429	364
6	Total no. of person with disabilities	78	45
7	Total number of male	320	223
8	Total No. of females	109	141
9	Total Share Capital	5.05 Lakh	2.00 Lakh
10	Loan availed from finance institute	·         1st loan from Nabkisan Finance Limited, Mumbai. Total 7.48 Lakhs (Loan has returned)   ·         2nd loan availed in the 2022 of Rupees 20.00 Lakh from the same finance Institute	Under Process with Nabkisan & SBI
11	Products traded	Pulses, spices & vegetables	Pulses, spices & vegetables
12	Availability of grading/quality checking facility	Yes	Yes
13	Storage facility available	Yes	Yes
14	Availability of outlet/shop	One shop at Chakrata market	One Shop at Lakhamandal block Chakrata
15	Farm advisory services to shareholders	Yes on regular basis	Yes on regular basis
16	Licenses availed	FSSAI & Udyog Adhar	FSSAI & Udyog Adhar
17	Any Brand developed so far	Yes, by the name of “DEVVAN”	Under Process
18	BoDs trained	Yes from HJS, ATI & BIRD Lucknow	Yes from HJS, ATI & BIRD Lucknow

 

 

Forward & Backward Linkages created by both FPO

In spite of being incepted in short period of time, the FPO has managed to establish some strong forward and backward linkages.

 Backward Linkages - Procurement of Inputs

The inputs are procured from the farming community in the area. During the initial phases, the farmers have been made aware of the importance of organic farming as well as given training to make vermin compost & Jivamrit. Many members are now successfully making vermin compost & Jivamrit and using it in their fields. Approx. 25 inclusive SHGs are formed under the project called Formation & linkages of SHGs through NABARD in the project area, in which total 252 marginal farmers are associated. The unique feature of these groups is that the person with disabilities are also included in the SHGs. Thus linkage of SHG & FPO giving strength to the both FPOs. Hence, the concept of ‘social justice’ and mainstreaming is inherent in the conceptualization of these groups. When the FPO were incepted in the area in the year 2019, many inclusive community groups started joining the FPO, and the same become a strong part of the backward linkages as these were already working with community people. In addition, the FPO has been collecting traditional seeds from member farmers, and till now it has collected, and distributed around 157 kg of such seeds to the members of FPO.

Technical Guidance: The farming community in the target area has been provided guidance ,and support for producing manure to be used in organic farming, they were made aware about the benefits of organic farming, and increasing demand of such produce in urban areas. Besides, technical guidance has been provided for diversification of their incomes. For example, trainings for pickle making, nuances of pulse, and spice production, dairy farming, production of high-value vegetables like mushrooms, creation of poly houses for vegetable production, establishment of apple orchards, camps for mobilisation of members, and creating awareness about significance of collectivisation of farmers into groups, awareness about the benefits of joining FPO etc. have been organised from time to time. These programs have helped the organization create value, and build trust in the community. The Board of Directors of both FPOs are now respected, and considered trust worthy among the local people. This is as valuable as creating brand loyalty by any commercial organization.

Training, Research & Knowledge Management: Capacity building of Board of Directors, shareholders, management, and staff of FPO is of immense importance. The FPOs has arranged many trainings, and capacity building programs with the support from NABARD & Nabkisan Finance Limited. NABARD facilitated the Board of Directors & CEO trainings at ATI, while Nabkisan Finance Limited provided grant for the Shareholders capacity building trainings at Field level. NGO is also sending Board of Directors of both the FPOs to BIRD Lucknow for the advance training on FPOs. Since 2019 to till date, FPO’ Board of Directors & CEO has been continuously taking training on FPO management at ATI, Guptkashi through NABARD & NGO is also providing training on village & field level. Till date four trainings to each Board of Directors & four trainings to CEO has been given by NABARD. All are well aware about FPO management & other compliances etc. 

Forward Linkages

Storage: The produce collected from members is stored at the dedicated office space of the FPO as well as at outlet. As of now, the space suffices as shared by the office bearers. However, in near future as membership, and collection increases, some linkages with collection centers will have to be established.

Processing: Processing, value Addition, grading, processing, and packaging services are being offered by the FPOs. Besides, value addition is being done by processing spices into spice powder, pickles from locally grown vegetables etc.

Marketing: There are various marketing linkages established by the FPOs in a short span of time. The products are marketed under the brand ‘DevVan’ created by the members of the FPO & brand of second FPO is under process. The brand logo symbolises the purity, and holiness of the hills in Uttarakhand. The marketing of the products is majorly done through an ‘Agri- Business Centre’/ Outlet at Chakrata market & Lakhamandal. Apart from this, there are institutional sales to hotels (at Mussoorie, Dehradun), different banks at Mussoorie, boarding schools at Mussoories, Lakhamandal, NABARD state office etc.

Financial & Business Activities

As per balance sheet of 2022-2023, the share capital of Jaunsar Kissan Producer Company Limited is Rs. 5,005,000. The maximum amount of Share is Rs. 2000.00, and the share value amount is Rs.10 for each share. FPO-2 share capital became 2,00,000,000 as per 2022-2023. FPO-1, has taken its first loan of Rs. 7,48,000 from NABKISAN Finance Company Limited, Mumbai & received a subsidy/ grant of Rs. 75,000 from the same institution. Total loan has been repaid by the FPO, in Feb 2022, FPO took second loan amount of Rupees 20.00 Lakh for the expanding its business from Nabkissan Finance Limited. FPO-2 credit linkage process is going on with Nabkisan & SBI.

 

 

Finacial Statistics of FPO-1 for the financial year 2022-2023
Authorized Capital	10,00,000.00
Share Capital	5,005,000.00
Reserves	29,53,894.00
Expenditure	23,66,910.00
Turnover	38,21,512.00
Gross Profit	14,54,602.00

 

Finacial Statistics of FPO-2 for the financial year 2022-2023
Authorized Capital	15,00,000.00
Share Capital	2,00,000.00
Reserves	90,755.00
Expenditure	15,76,042.00
Turnover	18,82,199.00
Gross Profit	3,06,157.00