Over 340 FPOs Cross Rs 10 Cr Turnover, Boosted by E-Commerce

More than 340 Farmer Producer Organisations (FPOs) set up under a special central scheme launched in FY21 have reported annual sales turnovers exceeding ₹10 crore, while nearly 1,100 FPOs have surpassed the ₹1 crore mark, according to data from the Union Ministry of Agriculture.

These high-performing collectives have leveraged digital platforms and government procurement programs to scale up operations and expand market reach. The growth trajectory underscores the scheme's impact in transforming farmer collectives into commercially viable entities.

Digital Platforms Empower Agri-Enterprises

The government’s flagship digital commerce initiatives — including the Open Network for Digital Commerce (ONDC), electronic National Agriculture Market (e-NAM), and Government e-Marketplace (GeM) — have emerged as game changers for FPOs. Over 9,000 FPOs are now integrated into ONDC, while more than 200 have listed products on GeM. Sales have also begun to take off through private e-commerce giants like Amazon and Flipkart.

“These platforms are giving farmer groups visibility and access to markets that were previously out of reach. We are now exploring incentive mechanisms to reward the top-performing FPOs and inspire others to follow suit,” a senior official from the Agriculture Ministry said.

Several FPOs have also been active participants in the government’s minimum support price (MSP) procurement schemes, particularly in oilseeds, pulses, and grains — a factor that has significantly boosted their revenues.

Case in Point: Babra Khedut Mandli’s ₹102 Cr Milestone

A leading example is Gujarat-based Babra Khedut Utpadak & Rupantar Sahakari Mandli, an FPO with 1,465 farmer members, which has recorded an annual turnover of ₹102 crore. The group primarily procured groundnut and cotton at MSP on behalf of government agencies, CEO Nirav Prakashbhai Mathukiya told *Financial Express*. “We plan to expand our agri-inputs business this year to further boost revenues,” he added.

Expanding Scope Through Licences and Incentives

Many FPOs have diversified into input retailing by acquiring dealership licences for seeds, fertilisers, and pesticides — bolstering their financial sustainability. These groups are registered under various statutes, including the Companies Act, State Cooperative Societies Acts, or the Multi-State Cooperative Societies Act.

To enhance their viability, FPOs also access funding from schemes such as the Agriculture Infrastructure Fund and Agricultural Marketing Infrastructure programme.

As part of its strategy to build stronger market linkages, the Agriculture Ministry has facilitated direct dialogues between FPOs and major corporate buyers like Britannia, Flipkart, Big Basket, Country Delight, Olam International, and Mother Dairy through webinars and outreach programs. Institutional buyers such as APEDA, NAFED, and the Selco Foundation have also been roped in.

Financial Backbone of the Scheme

The central FPO scheme — aimed at empowering small and marginal farmers through collective bargaining and economies of scale — offers financial assistance of up to ₹18 lakh per FPO over three years. Additionally, a matching equity grant of up to ₹2,000 per member, capped at ₹15 lakh per FPO, is available.

Further, FPOs can access credit guarantees for loans up to ₹2 crore from eligible lending institutions. Cluster-Based Business Organisations (CBBOs), which help nurture and support FPOs, receive assistance of ₹25 lakh per FPO over five years to strengthen marketing and business operations.

With a total outlay of ₹6,865 crore, the scheme is set to run until FY26. Over three million farmers now hold equity in FPOs formed under the initiative, most of which have come up in the past five years.

The scheme’s evolving success signals a shift in India's agricultural landscape — from subsistence farming to organised, market-linked rural enterprises. As more farmer groups tap into digital marketplaces and formal procurement channels, the FPO movement is poised to become a cornerstone of the country’s agri-economy.

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