Over 5 Million Farmers Take Equity in FPOs, Boosting Collective Farming

Over the past five years, the trend of farmers taking equity in farmer producer organisations (FPOs) has significantly boosted local aggregation and helped reduce production costs by achieving economies of scale, according to a senior government official. More than 5 million farmers have become shareholders in over 10,000 FPOs during this period.

Telangana, Uttar Pradesh, Andhra Pradesh, Madhya Pradesh, and Maharashtra account for half of all FPO shareholders, with 0.67 million, 0.59 million, 0.57 million, 0.32 million, and 0.3 million farmers respectively. Women farmers represent 38% of the total membership, highlighting the growing participation of women in collective farming.

The central scheme for the formation of 10,000 FPOs, launched in February 2020 with a budgetary allocation of ₹6,865 crore over five years, has played a key role in this expansion.

The growth of FPOs is also reflected in their market performance. In the financial year 2024-25, 340 FPOs recorded sales turnovers exceeding ₹10 crore, while over 1,100 collectives reported sales above ₹1 crore. The cumulative turnover of all FPOs has crossed ₹15,282 crore. These collectives are registered under various legal frameworks, including the Companies Act, 2013, state cooperative society laws, or the Multi-State Cooperative Societies Act.

To support their operations, the government provides matching grants of up to ₹2,000 per farmer member, with a maximum limit of ₹15 lakh per collective. More than 5,880 FPOs have obtained seed licences, over 5,500 collectives hold fertiliser distribution licences, and around 400 FPOs have agrochemical dealership licences, ensuring that dealer discounts benefit member farmers.

Several FPOs are also exploring modern marketing channels, with over 200 collectives selling products on platforms such as GeM, Amazon, and Flipkart. Many have undertaken procurement of oilseeds, pulses, and grains under the minimum support price scheme, further enhancing their market presence. Under the scheme, each FPO can receive financial assistance of up to ₹18 lakh for a period of three years, providing a strong foundation for sustainable growth and farmer empowerment.

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