New Delhi, August : The Government of India has successfully formed 10,000 Farmer Producer Organisations (FPOs) under its flagship Central Sector Scheme launched in 2020-21, bringing together more than 65 lakh farmers, primarily small and marginal cultivators, to strengthen collective farming, improve market access, and enhance farm incomes.

In a written reply in the Lok Sabha, Minister of State for Agriculture and Farmers' Welfare, Shri Ramnath Thakur, said the Central Sector Scheme for "Formation and Promotion of 10,000 Farmer Producer Organizations (FPOs)" has achieved its target of establishing 10,000 FPOs across the country.

The Minister said the FPOs are engaged in a wide range of agricultural business activities, including the supply of agricultural inputs, aggregation and marketing of farm produce, value addition and processing, seed production, digital commerce through e-marketplaces, custom hiring services, and export promotion.

According to the audited financial statements for 2024-25, the performance of FPOs reflects growing business activity. Of the FPOs that submitted audited accounts, 6,964 recorded an annual turnover of up to ₹50 lakh, 862 FPOs achieved turnover between ₹50 lakh and ₹1 crore, while 1,135 FPOs reported annual turnover exceeding ₹1 crore.

The government also referred to Policy Paper No. 144 published by the National Academy of Agricultural Sciences (NAAS), which examines the functioning of FPOs across the country. The policy paper recommends strengthening industry linkages, connecting FPOs with institutional buyers, and improving collaboration between FPOs and research and development institutions to enhance their long-term sustainability and competitiveness.

To strengthen newly formed FPOs, the Government provides financial assistance of up to ₹18 lakh per FPO to meet management and handholding expenses during the first three years of operation. In addition, eligible FPOs receive a matching Equity Grant of up to ₹15 lakh to strengthen their capital base and can access a Credit Guarantee Facility covering project loans of up to ₹2 crore to improve access to institutional finance.

Each FPO also receives five years of handholding support through a Cluster-Based Business Organization (CBBO). The support includes capacity building, business planning, market development, institutional strengthening, and assistance in establishing market linkages.

The Minister informed the House that, so far, the Government has released ₹827.81 crore towards management costs and ₹631.98 crore as matching equity grants to FPOs registered under the 10K FPO Scheme.

The scheme has also helped strengthen farmers' access to agricultural inputs and post-harvest infrastructure. As on date, 6,928 FPOs have obtained seed licences, 4,987 possess pesticide licences, and 6,650 hold fertilizer licences, enabling them to supply agricultural inputs directly to their members at competitive prices.

Further, 5,765 FPOs have established their own processing units, adding value to agricultural produce and improving farmers' returns, while 3,083 FPOs have availed the Credit Guarantee Facility, enhancing their access to institutional credit for business expansion.

The Government stated that by collectivising more than 65 lakh shareholders, the scheme is enabling farmers to benefit from economies of scale, improve bargaining power, reduce input costs, and access better marketing opportunities, thereby contributing to higher incomes and stronger rural institutions.

The information was provided by Minister of State for Agriculture and Farmers' Welfare, Shri Ramnath Thakur, in a written reply in the Lok Sabha.