Published in: November 2018
The central and state governments are dedicated to enhancing food production and increasing farmers’ incomes. They have introduced various programs to achieve these goals.
In this effort, the National Bank for Agriculture and Rural Development (NABARD), a central government financial institution, has been providing substantial funding for programs that benefit farmers.
Recently, we discussed NABARD’s support for Farmer Producer Organizations (FPOs) in Tamil Nadu with Padma Raghunathan, NABARD’s General Manager for Tamil Nadu and Puducherry.
Padma Raghunathan’s Insights:
“The central government is committed to improving the livelihood of farmers by ensuring transparency in agricultural trade. For farmers to thrive, they must receive fair prices for their produce, have access to market information, and know about local prices and market timings.
To achieve these objectives, the Government of India has established an integrated online trading platform called E-NAM.
Building on these goals, in the 2014-15 budget report, the Finance Minister allocated 200 crore INR for production funding through NABARD, with a mandate to establish 2,000 producer organizations across India within two years.
Accordingly, with the production funding in place, approximately 2,000 producer organizations have been set up across 29 states in India. These organizations encompass around 620,000 farmers, dairy producers, fishers, weavers, and rural artisans as members.
FPOs are legally registered entities that consist of farmers or non-farmers. In these organizations, the producers themselves act as shareholders and owners, engaging in the sale of their main products. These organizations operate with the welfare of their members as their primary focus. A portion of the profit generated through business activities is distributed to shareholders, while the remainder is used to further expand the business. These organizations are structured to advance the development of rural communities.
In Tamil Nadu, 169 FPOs have been established, and one in Puducherry, with 125,000 farmers as members. Among them, 94 FPOs in Tamil Nadu achieved net profits in the 2016-17 fiscal year.
Members of these FPOs receive training in skills development, business planning, and technical strategies through workshops led by experts and field visits to agricultural universities, agricultural insurance companies, and professional institutions. NABARD supports these initiatives financially, benefiting farmers directly.
Additionally, commercial banks, regional banks, and cooperative banks extend necessary credit facilities to FPOs, with NABARD supporting these efforts through its subsidiary, NABKISAN.
NABARD also promotes awareness among farmers by assisting with natural resource identification, community coordination, arranging exposure visits, and providing information on market trends, often through watershed groups.
Furthermore, NABARD assists with organization registration, setting rules, and appointing Chief Executive Officers for these FPOs,” Raghunathan concluded.
M. Umapathy
