Linking smallholder farmer collectives to market: A case study of MAHA-FPC

Access to improved market and modern developments in science and technology are critical drivers of income and productivity in agriculture. There is an urgent need to boost direct investment in agriculture, intensify market access to farmers, improve food processing and value addition activities in rural areas. Lack of suitable synergy between diverse stakeholders viz. farmers, input and technology providers, public policy implementers etc. has impacted forward and backward linkage benefits in agriculture and has restricted smallholder farmers’ participation in the access to markets and technology. Collective action as an institutional arrangement is often advocated to reduce the twin prime challenges of agriculture - efficient price discovery through market participation and rising cost of technology usage for productivity growth. The present paper, is focusing on Farmer producers Companies (FPCs) as collective action institutions and tries to ascertain whether these institutions would be able to suitably bring in synergy amongst various stakeholders of Indian agriculture to enhance income and productivity, strengthen the supply chain and ensure value addition in agriculture. In India, more than 7,000 FPCs have been promoted by various agencies. However, very few are working as per the role intended. To address issues and challenges of FPCs, the Government of India introduced the concept of “State Level Producers Company (SLPC)” to cater to the marketing needs of FPCs of the State. This study follows the case study research design to examine the evolution, governance, and business operating system of one such SLPC - Maharashtra State Farmer Producers Company Ltd. (MAHA-FPC). It was observed that the MAHA-FPC has created an enabling environment for farmers, in general, and specifically, established better coordination among FPOs formed in the State; involved in the policy dialogue with the State and Central agencies; and facilitated in strengthening the backward and forward linkages of member FPOs. The lessons learnt would be useful for other such SLPCs to establish, promote agribusiness activities and inculcate entrepreneurial culture among farmer producers.