Farmer Producer Organization (FPO- Farmer Producer Organization)

 

Friends, today let us try to find out what is a Farmer Producer Organization (FPO- Farmer Producer Organization).

So, first of all, let's understand whether farmers need to create a producer organization or a company.

Roughly speaking, the answer to this question is more yes than yes ...... The reason is that, according to the new Agricultural Reforms Act 2020, it is necessary if the farmer wants to survive in the market. Our farmers are small and unorganized, so they don't get much respect in the market anymore, and anyone tries to break it, be it shopkeepers, traders or anyone else. We all know the power of unity. If the thorns are tied together, it is difficult to break, and if the stick is different, it is easily broken. That story applies to farmers in our rural areas. Your farmer is small, he has few resources, he cannot fight the market alone, the farmer alone cannot break the market lobby, and so if your farmer wants to dominate the market, by forming a farmer organization or company, Increasing the quality and quantity of your product, increasing productivity, helping each other, is very much needed.

There are many such farmers / organizations or companies, which are working very well, and provide their members with low cost seeds, fertilizers, pesticides, machinery and farming techniques, as well as give their members higher prices for their produce. To give an example, Sahyadri Farmer Producer Company- Nashik (https://www.sahyadrifarms.com), VAPCOL-Vasundhara Agri Producer Company Limited, Junnar Taluka Farmer Producer Company Limited, etc., many such farmer manufacturing companies are working successfully, and your Members are making a profit.

What is the concept of farmer producer organization?

The concept of a farmer producer company is to bring together different types of farmer producers, small and marginal groups of farmers, to solve many challenges related to agriculture, as well as to create an effective organization through the farmer producer company and take advantage of it for agricultural purposes. Key investing, updating new technologies, creating new markets as well as establishing oneself in a ready market, producing various agricultural products, as well as processing various types of by-products, setting up shopping malls through the company, grading of goods Classifying or classifying goods, marketing the goods in the market, selling the goods produced by the company members by branding in the name of the company, exporting the primary products of the members or importing goods or services. The main purpose and concept behind setting up a farmer producer company is to make its members more profitable by doing various activities in this way.

What is a farmer producer company and a farmer producer organization?

If more than 10 members of a primary agricultural producer come together and register as per government law, it can be called a farmer producer organization, farmer producer organizations can be registered under different laws, then if such an organization is registered under the company law, it can be called a farmer producer company. So if the Registration Societies Act, Multistate Society, Section 25, etc., it is possible to register farmer producer organizations in different ways. More than 10 farmers come together and register as members and to form their own organization or company under the law, it is called farmer producer organization. The registration of such organizations is legal under the various laws of the government.

 Who can be a member of a farmer producer company?

In order to set up a farmer producer organization, a primary productive farmer or farmer group is required. The primary producer should be the one who produces the commodity and it should really be a farmer or a group of such farmers.

1) Farmers, 2) Farmers' groups or groups 3) Nos. 1 and 2 together,

As above, any of the three farmers can become a member of the producer company.

 What are the rights of the members of a farmer producer company?

All members have the same shares in a farmer-producer company, so each member has the same rights in the company. Everyone has the right to equal voting.

How many members are needed to form a farmer producer company?

At least 10 and more farmers who are actually farmers can come together and register a farmer producer company. One or two or more organizations that actually produce agriculture can come together and form a farmer-producing company. According to a survey of experts, a farmer-producing company with 600 to 700 members can function successfully.

How many days does a farmer producer company get registration?

After the Chartered Accountant submits all the required documents to the Registrar of Companies, the Registrar of Companies, if all the documents are satisfactory as per the rules of law, gets the certificate of establishment of the company within 30 days after submission of application, i.e.

What are the benefits of setting up a farmer producer organization / company?

· B-seeds, fertilizers, pesticides, machinery, other materials required for agriculture will be available at wholesale prices, low prices, wholesale prices at the doorsteps of farmers.

It will help in making available the information and technology required for the crop.

Farmers will have the ability to bargain.

Farmers can sell any farm produce like cereals, pulses, vegetable products, fruits, and other agricultural products directly in the market by grading and packing.

Farmers can process and sell their produce themselves.

More benefits can be availed through government schemes - Rs. 6000 crore scheme through Central Government, special schemes of NABARD, schemes of Ministry of Food Processing, approval of Operation Green in the budget of 2019-20,

Concessional door loans from NABARD as well as grants for various projects,

Various types of loans are available from NABARD's Producer Organization Development Fund (PODF), etc.

Low interest rates on loans compared to other companies.

Sell ​​your product directly in the city or in the available market.

· Companies themselves can sell their products directly to the customer.

· Farmers will be able to decide the price of their goods themselves. Employment will be created in the village itself, the crisis due to natural calamities will be reduced, even if at some point the member does not have the product, the industry and employment will continue by importing and processing it.

Farmer Producer Company will give agriculture industry status.

· No tax will be levied on the profits of the farmer producer company for the next 5 years from the date of registration.

Ease of getting maximum loan to farmer producing companies.

Various schemes given to co-operative societies are given to manufacturing companies.

· The technology required for group farming as well as group farming can be easily accessed.

Why should an individual farmer join a farmer producer company, what will be the benefit to the farmer?

As seen above, the benefits will accrue directly to the members of the company, ie individual farmers, as these companies are always working for the benefit of their members. The product can be sold in the village or at a nearby place at a good rate, without brokerage, haulage, varai, adat, commission, transport.

What can a farmer company do under the Agricultural Producers Company Act?

Agricultural Production (Any Crop), Procurement - Purchase of farm produce as well as availability of agricultural inputs at low prices, processing of agricultural commodities, pooling (storage of agricultural commodities in one place), grading and packaging, handling, marketing, sales, Can export, import. The company can take all these actions on its own or from an outside expert organization.

What business can a farmer do through a manufacturing company?

B-Seed, Pesticides-Fertilizer Supply through Kisan Seva Kendra, Operation of Tools Bank, Purchase-Sale of Agricultural Commodities at Guaranteed Prices, Seed Tools on Credit to Farmers on C-Seed, Fertilizer-Seed, Process Industry and Sales, Training to Farmers, Poultry Farming, Goat Farming, Dairy Farming, Milk Project, Fish Project, Mushroom Project, Egg Production, Ayurvedic Medicine Plant, Biofuel Development Plant, Agri & Retail Mart, Organic Farming & Other Agri Product Manufacturing, Farming Floriculture, contract farming Free guidance to farmers for crops, implementation of government schemes such as (Swachh Bharat Abhiyan, Jalayukta Shivar Abhiyan, Swachh Bharat Abhiyan, Aamcha Gaon Aamcha Vikas Abhiyan, Samrudh Shetkari Abhiyan, Unnat Shetkari Abhiyan, Arogya Vikas Upakrama, Vriksharopana) Campaigns etc.).

What kind of services can a farmer organization provide?

Financial services

Agricultural Inputs Supply Service

Marketing / Sales Service

Technical service

 Networking service

Under which law can a farmer producer organization be registered?

1) Co-operative Societies Act

2) Multistate Cooperative Societies Act, 2002

3) Producer Company - Section 581 (c), Indian Companies Act. 1956, revised 2013.

4) Section 25 Companies, Indian Companies Act. 1956, revised 2013.

5) Society Register - Society Registration Act 1860,

6) Public Trust Register - Indian Trust Act 1882.

                                   (Source- small farmers agribusiness consortium)

How much share capital should there be for a farmer producer organization?

It is up to the organization to decide how much share capital to take on each member, to decide the share capital according to the financial strength of all its members. Normally Rs. Possibly 500 to 1000 members keep shares like this, it is entirely up to the organization to decide.

Composition of Farmers Producers Association-

The structure of a farmer producer organization is as follows,

What are the documents required for registration of Farmers Producers Association?

Self certified PAN card of each director.

Self certified Aadhar card of each director and member.

· Each director's self-certified voter ID card or driving license etc. (for proof of identity).

· Each director's self-certified electricity bill or bank passbook Xerox (for resident proof).

 Farmer Certificate with signature stamp of Tehsildar and Talatha.

7/12 excerpt in one's own name or in the name of a close relative.

· Collective certificate of all the directors with the signature of the Taluka Agriculture Officer.

 Colorful passport size photo of each director.

At least 4 suitable introductory names for the proposed company. The name of the company should suit the company and mention the farmers, their products, business.

Proposed office address for the company, its electricity bill and no-objection certificate of the office owner (in format).

· Mobile number, e-mail ID of each director, educational qualification, place of birth and amount of shares (in format).

Memorandum of Association.

Creating digital signatures of board members.

Information about the company's proposed business, etc.

The farmer producer organization should be registered with the advice and help of an accredited chartered accountant.

 What are the steps / procedures for setting up a farmer producer organization?

To know the social conditions and opportunities in the village.

Selection of potential leaders / activists in the community.

Frequent discussions with the selected worker.

To help in holding meetings of the people to explain about the establishment of the organization in the village.

To nominate a group of leaders / activists to form a farmer producer organization.

To formulate the structure and management structure of the farmer producer organization based on experience.

Initiate the process of formation of Farmers Producers Association.

Implementing the project netted for the Farmers Producers Association.

Monitoring and evaluating the work of the farmer producer organization, etc.

Procedures of Farmers Producers Institutions / Companies-

Once a farmer producer company is established, a Chief Executive Officer (CEO) has to be appointed. Appoints a chairman from among the members for the company. The company should have a minimum of 5 directors and a maximum of 15 directors. The directors who will sign the Memorandum of Association of the company are. An outline of how the company will operate should be outlined in the Company's (A&A) Articles and (MoA) Memorandum of Association. There is a provision in the law to punish the office bearer or member who acts against it, but the same provision should be made in the Architects and Memorandum. The company administration is required by law to retain a portion of the company's profits as a reserve. In addition, any remaining balance may be distributed to all members in the form of shares or dividends as mentioned in the company's meetings and regulations, as well as subject to company law.

The company can also give financial loans to its members but it has to be for a period of only 6 months.

The internal audit of the company needs to be done by an accredited chartered accountant.

The company administration may also grant certain privileges to those who are working members.

The shares of the company are not transferable, the member needs to be informed within three months of becoming a member, to whom the membership will be transferred after the death of the member.

The company board is required to hold a general meeting once a year, informing the members about the time, place and other details of the meeting.

The quorum for a board meeting is one third of the total number of members which should be at least 3.

A company with a turnover of more than Rs 50 million for three consecutive years is required to have a full-time company secretary. The Company Secretary is a member of the Institute of Company Secretaries of India.

How much does it cost to set up a farmer producer organization?

It may cost around Rs 39,600, but it may vary slightly depending on the fee of your chartered accountant.

What government schemes help farmers produce companies?

Loans are provided to such companies by NABARD. On the basis of which the company can develop itself.

· Equity Grant Scheme: SFAC, Delhi provides equity grants of up to Rs.

Credit Guarantee Fund: SFAC, Delhi provides manufacturing companies up to 85% of their projects or a maximum of Rs. 1 crore.

The loan is disbursed at low interest rate.

· Tools Bank: The government assists the manufacturing companies in providing various types of tools and equipment on rental basis and easy installments.

· Smart (SMART) Project: State of Maharashtra Agribusiness and Rural Transformation (SMART) in 10,000 villages of the state through World Bank and State Government.

Interest free non-payment project loan: Annasaheb Patil Economic Backward Development Corporation will provide interest free project loan of Rs.

In the next article, we will learn about how to make a business plan of a farmer producer organization and also the success story of some FPOs.

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