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tate
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ndia
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ivelihoods
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eport
2015
This has created awareness though results
are reportedly uneven. In some states the
awareness of PCs is very low as per POPIs.
By suitable amendments in the APMC
Act governments can allow direct sale of
farm produce by FPCs at the farmgate,
through FPO owned procurement and
marketing centres. State governments need
to make provisions for easy issue of licenses
to FPOs to trade in inputs (seed, fertiliser,
farm machinery, pesticides etc.) for use of
their members as well as routing the supply
of agricultural inputs through FPOs as in
the case of cooperatives. State governments
need to consider PCs at par with coopera-
tives and self-help groups or federations for
all schemes and benefits that are extended
to these member-owned institutions. PCs
need to be considered as key implementing
agencies for various government schemes in
the relevant sectors—agriculture, fisheries,
dairy, handloom, handicraft etc.
Benefits to members
With patronage
ranging from 20 per cent
to 50 per cent members, there are questions
raised on the effectiveness and efficiency of
mobilising producers as PCs. This form is
seen as costly vis-à-vis the benefits arising
there from. However, some of the POPIs
mention that establishing AMUL involved
lot of grants. Similarly, oil seeds federation
and other commodity federations have
also attracted lot of subsidies and grants.
Comparatively the investment in PCs has
been limited. However, a study to evaluate
the investments made in the last 10 years
and net benefits to producers will be useful
to determine the way forward.
Producer companies promoted under
the World Bank funded DPIP have shown
good performance and success rates in the
view of several stakeholders. This has been
due to a host of factors. The project support
unit and specialised NGOs provided hand-
holding and helped PCs progress through
the preparation, start-up, and incubation
phase, and several have achieved partial
autonomy and maturity. They also helped
catalyse convergence with government
programmes. Grant support for go downs
and machinery enabled PCs to store pro-
cess and to grade the produce, achieving
better prices for farmers. Monitoring by
the World Bank helped overcome hurdles.
Such a model of promotion and nurtur-
ance is no doubt expensive and resource
intensive, but it has a better chance of
achieving results.
To conclude,
FPCs seemed such an
obvious solution to several problems of
the governments and large organisations in
engaging farmers in meaningful ways with
significant cost efficiencies and benefits
on both the sides—the members and the
other business entities. But the concept has
taken a very long time to take roots. Even
after 12 years there are very few examples
of successful producer companies. The last
two years have seen a positive bent towards
PCs, judging from the number of PCs get-
ting registered and the number of schemes
designed to support PCs. But the emphasis
seems to be on establishing more PCs rather
than making PCs work for meeting mem-
bers’ interests and build themas sustainable,
long-term institutions (Annexure 5.1).
In the policy front, a clearer articulation
of the objectives withwhich PCs’ promotion
is taken up by public sector is a dire
necessity. Public funds should not be
spent on creating a number of institutions
on the ground unless they are designed
to actually deliver benefits to people at
large. The schemes of support should
focus on what kind of results should
be achieved and quantify the different
Though organising producers into producer
companies and promoting collective action
are often recommended as the solutions to
most of their problems, in practice, the pace
of progress and level of performance leave
much to be desired, in spite of the best efforts
of all concerned…. Collective action remains
a distant dream.
Source:
NABARD Annual Report, 2014–15.
