In 2020, the Cabinet Committee on Economic Affairs, chaired by the Prime Minister Narendra Modi, gave its approval for 10,000 FPOs to be formed in five years period from 2019-20 to 2023-24 to ensure economies of scale for farmers. Support to each FPO be continued for 5 years from its year of inception.
New Delhi: The Narendra Modi government of India has launched a new Central Sector Scheme titled “Formation and Promotion of 10,000 Farmer Produce Organizations (FPOs)” with a clear strategy and committed resources to form and promote 10,000 new FPOs in the country with budgetary provision of Rs 6865 crore.
In 2020, the Cabinet Committee on Economic Affairs, chaired by the Prime Minister Narendra Modi, gave its approval for 10,000 FPOs to be formed in five years period from 2019-20 to 2023-24 to ensure economies of scale for farmers. Support to each FPO be continued for 5 years from its year of inception.
Benefits of PM KISAN FPO Yojna
Small and marginal farmers do not have economic strength to apply production technology, services and marketing including value addition. Through formation of FPOs, farmers will have better collective strength for better access to quality input, technology, credit and better marketing access through economies of scale for better realization of income.
Under this Central Sector Scheme with funding from Government of India, formation & Promotion of FPOs are to be done through theImplementing Agencies (IAs). Presently 09 Implementing Agencies (IAs) have been finalized for formation and promotion of FPOs viz. Small Farmers Agri-Business Consortium (SFAC), National Cooperative Development Corporation (NCDC), National Bank for Agriculture and Rural Development (NABARD), National Agricultural Cooperative Marketing Federation of India (NAFED), North Eastern Regional Agricultural Marketing Corporation Limited (NERAMAC), Tamil Nadu-Small Farmers Agri-Business Consortium (TN-SFAC), Small Farmers Agri-Business Consortium Haryana (SFACH), Watershed Development Department (WDD)- Karnataka & Foundation for Development of Rural Value Chains (FDRVC)- Ministry of Rural Development (MoRD).
Financial assistance upto Rs 18.00 lakh per FPO
FPOs will be provided financial assistance upto Rs 18.00 lakh per FPO for a period of 03 years. In addition to this, provision has been made for matching equity grant upto Rs. 2,000 per farmer member of FPO with a limit of Rs. 15.00 lakh per FPO and a credit guarantee facility upto Rs. 2 crore of project loan per FPO from eligible lending institution to ensure institutional credit accessibility to FPOs.
