Steps for making Farmer Producer Organization in Andhra Pradesh Future Ready
Farmer Producer Organization’s in Andhra Pradesh have the ability to spur changes in our nation’s economic structure. Only when an FPO’s capital structure, governance, and management mechanisms are robust can they operate as planned. The government must handle other external aspects at a fair pace, such as the development of the infrastructure, the accessibility of the market and finance, the affordability of credit, the effectiveness of the commodities pricing mechanism, etc. These are a few actions that, over time, can have an impact.
The phases from Farmer Producer Organization’s in Andhra Pradesh internal management to its external management are depicted in this circular model. The first step is to increase the institutional leaders’ and the FPO board members’ capacity to understand optimal agricultural and management practises. Independent learning is a crucial stage in the development of FPO and is essential to become self-sufficient.
FPOs have the ability to spur changes in our nation’s economic structure. Only when an FPO’s capital structure, governance, and management mechanisms are robust can they operate as planned. The government must handle other external aspects at a fair pace, such as the development of the infrastructure, the accessibility of the market and finance, the affordability of credit, the effectiveness of the commodities pricing mechanism, etc. These are a few actions that, over time, can have an impact.
The phases from FPO’s internal management to its external management are depicted in this circular model. The first step is to increase the institutional leaders’ and the FPO board members’ capacity to understand optimal agricultural and management practises. Independent learning is a crucial stage in the development of FPO and is essential to become self-sufficient.
Step 1: Continual training on management practises for FPO board members and other important positions
The majority of FPO board members have experience farming, have led village committees, or have held other leadership roles in the village or at the Gramme Panchayat level. Building the ability of board members is crucial in a number of settings, such as isolated communities with little local leadership, high concentrations of smallholder farmers, intermediaries in powerful positions, a variety of livelihood options, etc. Strong leadership and an outside appointed CEO who can carry out his or her responsibilities with the highest loyalty and ethics are characteristics of successful FPOs.
The CEO post at Farmer Producer Organization’s in Andhra Pradesh is frequently filled by agri-graduates from nearby villages and communities. While this is a fine approach for establishing the organisation, the board must recognise the CEO’s responsibilities and keep the position out of the hands of local politicians. Board members require ongoing assistance in honing their business and MIS abilities as well as capacity building based on sound management practises.
Step 2: Develop a standardised FPO scoring system that takes social, environmental, financial, and managerial scores into account.
There is currently no industry-wide structure for scoring Farmer Producer Organizations in Andhra Pradesh, and methods vary depending on implementation or supporting organisations. One significant difficulty that has been noted is that financial institutions do not appear to have a distinct evaluation method for First Party Orders (FPOs). Policy makers must be aware of the important characteristics of FPOs, which call for a special evaluation procedure because they combine social and commercial institutions. After a few years, the appraisal score can alter and regard FPO as a commercial organisation. Financial organisations are currently concentrating more on the size of their balance sheets, but it is incorrect to ignore social and environmental factors.
In order to assist financial institutions, private agencies, CSR agencies, and other stakeholders in understanding the true image of the organisation before providing resources, FPOs in various phases are expected to use a common set of scoring models.
Step 3: Integrating FPOs with rural, agricultural, and farmer development programmes
In India, we create policies for a lot of things but neglect to integrate them at the project level. Regarding FPOs, there is clarity at the program/scheme level in New Delhi; nevertheless, village-level clarification is required. Numerous policies can be combined at FPOs to support it at first and assist these institutions in moving forward later on. Organisations such as NABCONS, SFAC, and the agriculture department can collaborate on issues pertaining to FPO and support one another in assessing resources, hazards, obstacles, and so on.
Step 4: Enhancing FPO’s risk management systems
FPOs urgently need to upgrade their data-related management systems; everything that occurs in the field, on the market, in the storage area, and at meetings has to be accurately documented. This will be very beneficial in identifying the patterns of activity occurring in any FPO, which will be essential for future success. It is necessary for the government and other implementing bodies to promote a standard MIS solution.
Various authorities have taken some action, but a more user-friendly and scientific approach is needed. CEOs and auditors of FPOs should get strong guidance on their MIS-related responsibilities, including how to handle errors and falsified data.
Step 5: Provide suggestions for the FPO’s financing structure at various phases and provide financial links to back them up.
Throughout its life cycle, FPO’s financial and operational structures cannot stay the same; like any other organisation, FPO needs to make structural adjustments to keep up with its development trajectory. A detailed examination of the FPO’s basic design reveals that while policies do not encourage innovation, there is room for it locally. For the FPO life cycle to be viable over the medium to long term, several local level innovations and collaborations are required. The recommended capital structure for FPO is effective in certain situations, however it has been observed that Farmer Producer Organizations in Andhra Pradesh reverts to its previous institutional state as soon as it receives funding from the government or another organisation in the majority of cases.
Because there is always a possibility of a loan waiver owing to political pressure, capital structure also holds the financial institution in check. A hybrid financial solution with enhanced implementation agency and management board responsibility is required for the FPO capital structure, along with some degree of flexibility.
Step 6: Launch the intra-FPO learning and development portal.
Currently, Farmer Producer Organizations in Andhra Pradesh are learning from other distant FPOs or may be cooperative in some other state, which is generally immaterial. There is a need to create a local platform whereby FPOs may learn from each other’s failures and successes. The government anticipates significant changes through eNAM, but local agencies must step up and begin using it for information exchange at the local level.
For FPOs, a state- or district-level knowledge forum must be established. It should be overseen by the agricultural department or other pertinent, capable government agencies.
Step 7: Expand the FPO’s involvement in social development initiatives
FPOs are formed from the local community in a hamlet where a single livelihood activity is the main source of income, such as fishing, horticulture, or agriculture. Together, all producer groups constitute FPO. In light of this context, it is also necessary to determine the prevalent social issues within the neighbourhood. Based on my observations, farmers, fishers, and other producers generally deal with the same societal issues since they come from the same area. It is necessary to define FPO’s societal function in order to strengthen its accountability. By taking this step, FPOs may be able to develop into more open and socially accountable institutions.
Step 8: Including FPOs in the ecosystem’s strengthening of rural entrepreneurship
We shouldn’t view FPO as a stand-alone organisation since it might lead to the emergence of several other small- and medium-sized organisations. To support an increasing number of rural entrepreneurs, the entire rural ecosystem has to be changed. This will work as a catalyst and generate a new rural entrepreneurial ecosystem. The notion of FPOs playing a more significant role in rural development is being considered.
Prior to comprehending FPO, policy makers, government agencies, DMs, BDOs, agri-extension officers, civic organisations, etc., must all grasp the broad scope of rural development.
The aforementioned actions are intended to position Farmer Producer Organizations in Andhra Pradesh with Search NGO as the hub of an institution for integrated development serving the rural populace, particularly farmers. By doing these actions, they will be able to consume more capital and contribute significantly to economic growth.
