By Bhanudas S. | 06 June 2020
Farmer Producer Organizations (FPOs) and Farmer Producer Companies (FPCs), albeit nascent, have come a long way to become an integral part of the Indian agriculture landscape. With their potential to give small and marginal farmers better bargaining power, FPOs and FPCs have had a significant role in improving economic and social condition for these farmers.
However, most of the FPOs and FPCs in the country still face major roadblocks and are failing to succeed in the digital age. Read on to get a new viewpoint on how advanced farm management systems can transform this picture for Indian FPOs and FPCs in the coming years.
Small and marginal farmers account for more than 85% of the land holdings and 44% of the land under cultivation in India, according to a recent report from National Bank for Agriculture and Rural Development (NABARD). With such a huge number of farmers being an integral part of the Indian agricultural economy, organising them into collectives through FPOs and FPCs can help them get benefits of economies of scale, not only in processing and marketing of their produce, but also in realising good value for their products.
While the larger picture for FPOs and FPCs has improved in the Indian agricultural landscape, these institutions have still struggled to make it big in the business space. Though governments are banking on policies and schemes to achieve their target to improving the income of small and marginal farmers, there are a few hindrances that hold back FPOs and FPCs from flourishing their business.
It is important for these institutions to take a few steps forward to understand the underlying factors that can concomitantly improve the farm management aspect as well as sustainable farming practices, in order to boost business growth.
The article discusses two prominent factors that are becoming roadblocks for FPOs and FPCs in India. This article will explain how these factors have been impacting the growth for farmers, and how next-generation agricultural technologies, including farmer and farm management systems, can help them make it a stepping stone.
Agriculture, being a traditional occupation in India, was rarely treated as a business that can fetch profits. However, the modern times have changed the perception of farmers in looking at farming as merely a mode of survival. FPOs and FPCs in India have witnessed growth in the upliftment of small and marginal farmers in the country. However, they still lag behind on the scale of doing business and successfully incurring profits.
One of the most important reasons why FPOs and FPCs are failing as a business is lack of business professionals that can improve agricultural planning and other business operations through farm management systems. It is a high time for these farming institutions to give a professional management perspective to their business operations including planning, production, post-production, finance, branding and marketing, customer management, as well as stakeholder management. These processes need to be streamlined in such a way that positive outcomes can be deliberately planned and achieved.
Tech-based agribusiness management platforms - such as FarmERP - can uplift the business aspect of FPOs and FPCs, enabling them to strengthen operations through effective business planning and other operations across the supply chain. A wide range of advanced technologies including Artificial Intelligence, Machine Learning, and Internet of Agricultural Things (IoAT) are being integrated into FarmERP’s Agribusiness management system, which makes technology a workhorse for small and marginal farmers for yielding high-quality crops with maximum efficiency.
Various features of this high-tech agriculture management system can help them streamline processes across all farms simultaneously and remotely. This, in term, can contribute greatly in maximizing productivity as well as profitability for FPOs and FPCs in India. Thereby, the farming institutions in the Indian agricultural landscape need to equip themselves with farm management tools to augment business in the Digital Age.
The use of agricultural technology is not alien to agribusinesses of the modern times. A majority of farming businesses across the world are aware of the convergence of Information Technology and agriculture. While the entire global agriculture industry is moving towards Agriculture 5.0 - where the use of next-gen technologies including Artificial Intelligence and IoAT is normalised - Indian small and marginal farmers are still miles away from reaping the benefits of Agri-technologies.
FPOs and FPCs in India need to give special attention to equipping farmers with tech-based tools for effective farm management across operations such as material and machinery management, quality control, planning, and ensuring food safety and traceability. Training and encouraging small and marginal farmers in rural areas to incorporate technology-based farm management tools can only empower them to compete on international ground. Thereby, taking into consideration that the existing advancements in agricultural technologies is nothing but an underutilised advantage, or unutilised in some cases, needs to be the first thing that FPOs and FPCs do in India.
It must be understood that adoption of these farm management technologies is going to be inevitable in the coming years. It is also a long-term process, as it takes time for these farmers to switch to completely new ways of farming. It requires a paradigm shift not only in production and post-production operations but also in the culture and attitude. Hence, with deliberate planning and continuous effort for effective implementation, FPOs and FPCs can help these farmers to leverage technology to fetch profits.
FarmERP has been making a sincere effort in strengthening FPOs and FPCs in India with next-generation technologies with its agribusiness management platform for facilitating profitable and climate-resilient production. The governing bodies are also modifying their policies to promote growth of Indian agriculture industry. Favourable regulatory framework combined with FarmERP’s high-tech agriculture management platform can build a roadmap to global success, not only for these agricultural institutions but also for the small and marginal farmers in the industry.