Factors Contributing to the Success and Sustainability of Farmer Producer Organizations in India: A Review
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Author: Murugananthi D., Balaji Parasuraman, Aruna Pabha S., Rohini A., Sivakumar S.D. and Kalaiarasi D.
Author Address: 1ssistant Professor, Directorate of Agribusiness Development, Tamil Nadu Agricultural University, Coimbatore-641 003 (Tamil Nadu), 2Professor and 3 Research Scholar, Department of Agricultural and Rural Management, Tamil Nadu Agricultural University, Co
Keywords: Constraints, farmer producer organizations, success, sustainability.
JEL Codes: Q01, Q13.
Abstract
A significant portion of Indian agriculture is comprised of small and marginal farmers who are integrated through traditional value networks and have limited access to markets and resources. Even when they have opportunities to access markets, they are limited in their ability to bargain with large buyers because of their weak bargaining position. Farmer Producer Organizations (FPOs) aimed to integrate small farmers with the agricultural marketing system and offer remunerative prices with low transaction costs. FPOs are supposed to improve the livelihood of farmers by integrating input purchase and providing forward linkage. This article reviewed the impact created by FPOs, the constraints faced, and the factors contributing to the success and sustainability of FPOs. About 90 articles were collected from JSTOR, Scopus, Web of Science, and peer-reviewed journals and reviewed. FPOs had created an impact in terms of increased income, the establishment of market linkages, the creation of infrastructure, and the provision of inputs and technology at a lower cost. To sustain success, it was concluded that forming both forward and backward linkages, building the capacity of members, ensuring effective leadership, creating the necessary infrastructure, employing strategic marketing approaches like product differentiation, branding, and adding value, along with securing low-cost working capital, were essential elements for FPOs. Deliberate measures should be implemented to guarantee the success of this pioneering institutional model.
Description
Indian J Econ Dev, 2025, 21(2), 383-393
https://doi.org/10.35716/IJED-23561