The Union Finance Minister while presenting Union Budget for 2014-15, announced setting up of “Producers Organization Development and Upliftment Corpus (PRODUCE) Fund of `200 crore in NABARD to be utilized for the promotion of 2000 Farmer Producer Organizations (FPOs) in next two years.
The broad objective of the Fund is to promote and nurture Farmer Producer Organizations (FPOs) by way of extending the required financial & non-financial support during the nascent/ formative stage. It is critical to support FPOs in terms of awareness creation, capacity building, technical support, professional management, market access, regulatory requirements, etc. and provide handholding support for a minimum period of 3-5 years and the same is met as grant under the Fund. The requirement of the FPOs for their business has to be met out of their own funds, equity mobilised, institutional credit and profit generated, etc. depending upon the local needs
Guiding Principles for assistance
- FPOs registered under any statute/legal form can be supported
- The FPO should act for the benefit of the producers and there is active community participation(ownership/management/empowerment)
- Activities falling within the domain of agriculture, activities allied to agriculture including dairy, poultry, fisheries and covering the entire value chain will be eligible for support
- There is integrated approach in implementation of projects (need-based and flexible, convergence with other schemes/programmes)
Progress as on 31 March 2015
As on 31 March 2015, about 835 FPOs were mobilised by the POPIs and sanctions were accorded by the ROs for their capacity building/ nurturing and further development for 3 years.
These FPOs are under various stages of formation and out of 835 FPOs mobilised during the year, only 259 FPOs could complete their registration formalities up to 31.3.2015. In order to ensure that adequate social capital is built and effective capacity building measures are taken, NABARD executed an Agreement with the individual POPIs.
The details of physical and financial progress in promotion of FPOs under PRODUCE are given as under: