Farmer Producer Organization refers to farmer- producers’ organization incorporated/ registered either under Part IXA of Companies Act or under Co-operative Societies Act of the concerned States and formed for the purpose of leveraging collectives through economies of scale in production and marketing of agricultural and allied sector. The concept behind Farmer Producer Organizations is that farmers, who are the producers of agricultural products, can form groups. To facilitate this process, the Small Farmers’ Agribusiness Consortium (SFAC) was mandated by Department of Agriculture and Cooperation, Ministry of Agriculture, Govt. of India, to support the State Governments in the formation of Farmer Producer Organizations (FPOs)
The Government of India has approved and launched a Central Sector Scheme of “Formation and Promotion of 10,000 Farmer Producer Organizations (FPOs)” to form and promote 10,000 new FPOs till 2027-28.
Under the scheme, the formation and promotion of FPO is based on Produce Cluster Area approach and specialized commodity-based approach. While adopting cluster-based approach, formation of FPOs will be focused on “One District One Product” for development of product specialization.