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Producer Company

What is the Role of FPO?

The Farmer Organisation or the FPO plays a very crucial role in contributing to the overall development of the producers or the farmers. The major Central scheme of ‘Formation and Promotion of 10,000 FPO’ have targeted the overall production of the Indian economy, keeping in mind the interest of the farmers.

The FPO is a body of individuals that looks after the interest of the farmers and the primary agricultural producers. The government of India has also taken an initiative to launch more than ten thousand FPOs that will be functional for the growth and maintenance of what the farmer produces, and it is the role of the FPO to see that no farmer is deprived of the rights and amenities that are meant for them.

It is one of the steadiest and the most sustainable sources of income generation for farmers or groups of farmers. With proper insurance facilities, growth-driven potential and ideas generated for the farmers to take care of their agricultural output daily, the producer organisation has a lot of things to do. It is the role of the FPO to check the production, the earnings of the farmers, and how they can double the farmers’ income. 

A registered and experienced FPO gives professional handholding to all new FPOs in the market. This they do for around five years till the new company gets on its feet. The major role that the Farmer Producer Organisation plays is detailed as under:

  • To initiate the processes of income and revenue generation for the farmers. High-quality production and dissemination of ideas to promote revenue and profit enhance the farmer’s confidence in innumerable ways. 
  • The FPO also takes the initiative to give high-quality products, including seed, production, usage and quantity of insecticides and pesticides all at a lower rate than when the farmer has to buy from an open market. 
  • The FPO functions to check the need-based production units that are opened, what need-based agricultural products are launched into the market, and how to manage the post-production works. The organisation also looks after selling and buying equipment, machinery, cultivators, high-quality land tillers, sprinkler sets, and combined harvester machines. They can also hire large-scale equipment if needed. 
  • It is also the work of the FPO to go for major value addition like sorting, cleaning, grading, packaging and exporting food crops and other agricultural items. The processing and grading of agrarian items give them an idea about what agrarian products have the most significant market demand and how they can sell, negotiate, and earn profit. 
  • Apart from these, the Farmer Organisation also has to encourage the farmers to earn through innovative methods like sericulture, beekeeping, mushroom farming, etc. This is not just a new agrarian reform but is also much more popular among the people now. While the FPO is there, the farmers do not have to sell their agricultural products at a lower or lesser price. Also, the FPO sometimes makes an arrangement to take multiple products from many farmers, bring them, and sell them under one roof. This gives some amount of profit to everybody, and nobody is deprived. 
  • It is one of the major works of the FPO to check and see how agricultural production undergoes experimentation on each new day. New seeds, new crops, new ways of cultivating and tilling lands, and using organic and more environmentally-sustainable crop production methods can be made possible if the FPO harnesses proper agricultural knowledge and marketing capability. 
  • The FPO takes every initiative to know the points of negotiation they can do with the buyers. Since there is a complete absence of a middleman, it becomes easier for the farmers to sell their items for a fair profit. The FPO also knows the relevant processes of bargaining and going on for the customer demands. As of now, if we take the case of India, there are in total 4465 FPO clusters that are entrusted with the work of formation of the FPOs and looking after the farmers and their causes.

It is also the priority of the government to give adequate training to the FPOs so that they can give enough resources, knowledge, and handholding and also, and the CBBOs provide the initial training in this field. Now, considering the country’s agrarian economy, it is decided by the government authorities that the formation of the Farmer Organisation should take place in all those major aspirational districts where development is still very low. And add, there should be the formation of at least one FPO in each block of the district to facilitate economic growth and foster greater revenue for the farmer. For instance, in the North-Eastern part of India, the scenario needs to be agile and flexible.

It is true that under the aegis and guidance of an FPO, the best and the primary benefit that the primary producers get is that they do not get duped by the intermediaries. There is no random price growth of crops, no stealthy way of buying and selling crops and fertilisers. With the help of the FPO, there is better community growth, which creates a harmonious economic relationship within the district and as part of the country. Market opportunities are increasing daily, as are the growing demand and the number of competitors. Hence, the role of an FPO becomes vital here. It needs to update itself on all the recent agricultural and farming developments and set future goals to sustain the livelihood of the farmers. 


It is the work of the FPO to check the overall development of the individual farmers and the organisations or institutions under a single, unified umbrella. The storage, logistics, transportation, import, export and profit segments remain within the best care of the FPO. 

If you want to get the essential information about what an FPO is and its functions, then you can check out the info on Vakilsearch. Under one roof, you get a lot of professionals dealing with companies, laws, acts, taxes, registrations, functions, compliance work etc. The ever-active support team makes your search more accessible, and in Vakilsearch, all your official documents remain safe in secure vaults.

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