Current challenges and solutions for sustainability of Farmers Producer Organisations through grassroots organisational ecosystem

Abstract

India’s agricultural landscape is largely dominated by marginal and small farmers, who constitute approximately 67% and 18% of the total farming community respectively. This translates to a staggering 92 million marginal farmers with less than 0.40 hectares of land and 24 million small farmers with an average landholding of 1.42 hectares. Despite their higher productivity compared to large farmers, these smallholders face significant resource constraints and market challenges. While the formation of Farmers Producer Organisations (FPOs) has partially addressed these issues, newly established FPOs continue to encounter significant sustainability challenges. These include limited volumes, low capital, low member engagement and a subsidy-oriented rather than market-oriented approach. The present article identifies critical challenges such as limited capital, low member engagement and a predominant subsidy orientation. Currently, over 8875 FPOs are registered nationwide, but only 16–30% are sustainable. A significant issue is the inability of the majority of FPOs to raise more sizable amount of paid-up capital, highlighting the urgent need for a robust grassroots organisational ecosystem. This study proposes an eight-component ecosystem model for FPO sustainability, encompassing market, policy, infrastructure, services, inputs, HRD, finance and innovation. This model aims to create a comprehensive support structure for FPOs, facilitating better market access, financial resources, member participation and innovative practices. The implementation of this model, along with suggestive measures for strengthening FPOs, is crucial for their long-term viability in India’s evolving agricultural sector. © (2025), (Indian Academy of Sciences). All rights reserved.