State of India’s Livelihood (Soil) Report 2021

SOIL Report 2021: Relevance

• GS 3: Transport and marketing of agricultural produce and issues and related constraints; e-technology in the aid of farmers.

State of India’s Livelihood Report: Context

• The State of India’s Livelihood (SOIL) Report 2021 was released by Access Development Services, a national livelihoods support organisation where the report has analysed the Farmer Producer Companies (FPCs) of India.

About SOIL Report

• The State of India’s Livelihoods (SOIL) Report is an annual Report on policy and programmes of the government, potential opportunities for the poor, on the role of the private sector and the civil society in livelihoods promotion.

SOIL Report 2021: Key points

• The report has revealed that only 1-5% of the Farmer Producer Organisation have received funding under various schemes of central government that were introduced in the last seven years.
• The report has only analysed FPCs as they comprise the largest form of organisations started in recent years.
• FPCs are the FPOs registered under The Companies Act, 2013.
• The number of FPOs registered as societies or cooperatives are very small.

What is a Producer Organisation?

• A Producer Organisation (PO) is a legal entity formed by primary producers, viz. farmers, milk producers, fishermen, weavers, rural artisans, craftsmen.
• A PO can be a producer company, a cooperative society or any other legal form which provides for sharing of profits/benefits among the members.

What is FPO?

• FPO is a legal entity which consist of collectivization of producers especially small and marginal farmers to collectively address many agricultural challenges ranging from seed purchasing to crop marketing.

Government steps to promote FPOs

• Since 2011, the Central government has intensively promoted FPOs under the Small Farmers’ Agri-Business Consortium (SFAC), NABARD, state governments and NGOs.
• Union Budget 2018-19 announced the launched of “Operation Greens” for onion, potato and tomato crops on the lines of Operation Flood with an allocation of Rs. 500 crores.
• It aims to address price fluctuation in vegetables for the benefit of farmers and consumers. It will promote FPOs, agri-logistics, processing facilities and professional management.
• To encourage enabling environment for aggregation of farmers into FPOs and take advantage of economies of scale, the Government announced a 100% tax deduction for FPOs with an annual turnover of up to Rs. 100 crores.
• In 2020, ”Formation and Promotion of Farmer Producer Organisations” was launched to promote 10,000 FPOs in the next five years, starting 2019-20, which would help small, marginal and landless farmers to enhance their income.
• PMFME: Under the PMFME, the Centre aims to promote formalisation in the unorganised micro-processing food enterprises as well as support the FPOs, Self-Help Groups (SHGs) with the support to develop infrastructure, branding and marketing.

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