Government of India has launched a new Central Sector Scheme. Billed as "Formation and Promotion of 10,000 Farmer Produce Organizations (FPOs)", it is meant to   promote 10,000 new FPOs in the country with budgetary provision of Rs 6865 crore.

FPOs are to be developed in produce clusters, wherein agricultural and horticultural produces are grown / cultivated for leveraging economies of scale and improving market access for members. 

“One District One Product” cluster to promote specialization and better processing, marketing, branding & export.  Further Agriculture value chain organizations forming FPOs and facilitating 60% of market linkages for members produce. 

Under this 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). 

Implementing Agencies (IAs) will engage Cluster Based Business Organizations (CBBOs) to aggregate, registered & provide professional handholding support to each FPO for a period of 5 years. CBBOs have been empanelled & engaged by IAs. CBBOs will be the platform for an end to end knowledge for all issues related to FPO promotion. 

During 2020-21, a total of 2200 FPO produce clusters have been allocated for formation of FPOs, which also include specialized FPO produce clusters such as100 FPOs for Organic, 100 FPOs for Oil seeds etc. Of these, 369 FPOs are targeted for formation during current year for formation in 115 aspirational districts in the country.

NAFED would form the specialized FPOs which should necessarily be forwardly linked to the market, agri-value chain, etc. NAFED will provide market and value chain linkages to the FPOs formed by other Implementing Agencies. NAFED has formed & registered 05 Honey FPOs during current year in Uttar Pradesh, Madhya Pradesh, Rajasthan, Bihar & West Bengal. 

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. 

At district level, a District Level Monitoring Committee (D-MC) is constituted under the Chairmanship of District Collector/ CEO/ ZillaParishad with representatives of different related departments and experts for overall coordination & monitoring the implementation of scheme in the district including the suggestion for potential produce cluster & development

At National level, National Project Management Agency (NPMA) as a professional organization has been engaged for providing overall project guidance, coordination, compilation of information relating to FPOs, maintenance of MIS and monitoring purpose.

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