30 FPOs see over 2-fold jump in revenue in 2 yrs after SFAC intervention

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About 30 farmer producer organisations (FPOs) in three states, including West Bengal, reported a more than two-fold increase in their annual turnover in the last two years after a pilot intervention to make them viable, Small Farmers Agri-Business Consortium (SFAC) said on Sunday.

SFAC, an autonomous body promoted by the Union Agriculture Ministry, collaborated with Grant Thornton Bharat in 2018 to introduce multiple interventions on 30 select FPOs in West Bengal, Karnataka, and Madhya Pradesh for two years.

“A gamut of interventions were undertaken by way of input, credit, common facilities, and market linkages, in addition to capacity-building and training of the Board of Directors (BoDs) on business planning. Notably, almost all of the FPOs were credit-linked for either working capital or term loan,” said SFAC Managing Director Neelkamal Darbari in a statement.

According to SFAC, the impact assessment of the interventions showed that the average turnover of 30 targeted FPOs increased from Rs 44 lakh to over Rs 118 lakh per annum in a span of two years.

The underlying purpose of the pilot project was to collectivise and energize FPOs operating at various levels across these states and increase farmers’ income, thereby sustainably strengthening their agriculture-based livelihood, it said.

In two years of interventions, SFAC said turnovers from input operations increased from Rs 24.5 lakh per annum to over Rs 47.43 lakh for the 30 FPOs. The market operations of the FPOs also increased from nearly Rs 15 lakh per annum to over Rs 64 lakh, it said.

For instance, the turnover of Karnataka-based Shri Amarnayana Horticulture Farmer Producer Company (SAHFPCL) increased from Rs 47.60 lakh in 2017-18 fiscal to Rs 78.48 lakh in 2018-19 and Rs 387.58 lakh in 2019-20.

SAHFPCL, which initiated operations in February 2016 with 1,000 shareholders farmers, successfully benefitted from collective selling and collective procurement, which helped farmers in reducing the cost of production and receiving optimum sale price for their produce.

Similarly, the turnover of West Bengal-based Debra Agribusiness Farmer Producer Company Ltd (DAFPC) has increased from Rs 54 lakh to Rs 86.16 lakh in the past two years. Its paid-up capital increased from Rs 10 lakh to Rs 20 lakh.

According to SFAC, the targeted 30 FPOs were assisted by identifying and linking them to new processors and organised retailers such as Keventer Agro, Zomato Hyperpure, WayCool Foods, ADM Agro Industries India, Big Bazaar, Star Bazaar, Mother Dairy, Safal, Adani Wilmar, Vippy Industries, ITC, and Bigbasket.

Linkages were established with various processors, modern retail companies, input suppliers, etc. As a result, the overall cumulative sales turnover value of the 30 FPOs stood at approximately Rs 3,548 lakh in three states for 2019-20, it added.

Talking about the impact and the future of FPOs, Grant Thornton Bharat Partner Kunal Sood said: “Direction, demonstrated options for growth and more role-models are required to encourage FPOs to evolve into vibrant agri-business platforms.” If these are provided, then there is no reason why all existing infant, teething, or even dormant FPOs cannot evolve into vibrant entities propelling the drive towards doubling farmers’ income, he added.

So far, SFAC has promoted 910 FPOs across 29 states. A majority of these FPOs are in Madhya Pradesh, Karnataka, and West Bengal.

SFAC is also the nodal and an implementing agency for the government’s new scheme on promoting the setting up of 10,000 FPOs to ensure economies of scale for farmers.