Farmer producer companies in Telangana state - A case of Karimnagar Milk Producer Company Limited

Farmer Producer Companies (FPCs) is one of the types of Producers Organizations. It’s been one and a half decade but the FPCs started emerging since last 5 years. NABARD, Small Farmers Agribusiness Consortium (SFAC), Non-Government Organizations with the help of State Governments have been instrumental in making the FPCs. Today’s main problem of agriculture is high cost of production and marketing agricultural produce at remunerative prices. The successful farmer producer companies in India have shown that collectivisation of farmers, their networking has contributed to the reduction in transaction cost, increased collective bargaining power and ultimately contributed to increased incomes of the farmers. India ranks first in milk production and produces 18.5 percent of worlds milk production and is providing livelihood to millions of farmers through integrated cooperative system. Most of the FPCs in Telangana State have emerged since 2012. Karimnagar Milk Producer Company Limited was first established as Karimnagar Diary in 1971 under the Andhra Pradesh Diary. It got registered under the Co-operative societies act on 13^th march, 1997. On 1^st November, 1998, the cooperative was handed over to the Milk Producers Committee. During 2003, the cooperative was converted into Mutually Aided Cooperative Society. And on 24^th May, 2012, it changed into Karimnagar Milk Producer Company Limited under the companies’ act 1956 as a private limited company. The farmer producer companies are now emerging in the state of Telangana. Companies such as Karimnagar Milk Producer Company, Chetna Organic Agriculture Producer Company, Kodangal Farmer Services Farmer Producer Company, Sahaja Aharam Organic Producer Company and many such companies have shown success in providing benefits to the farmers. The case study of Karimnagar Milk Producer Company Limited reveals that the company is able to benefit after converting itself to Producer Company from Mutually Aided Cooperative Society. The company is the biggest in the state in terms of capital, number of members and also in providing benefits to the farmers through its various welfare schemes. The company has shown an increasing trend in procurement of milk and sales. The company has increased its turnover from 150 crore to 250 crore with a span of 5 years. The various welfare schemes that were extended to the farmers have helped them increase their incomes and also helped them to maintain their animals in good health. The fodder that was supplied to the producers helped them to increase the milk production. The financial help that was extended to the producers on time have helped them in purchasing animals and inputs on time. Medical care is taken for the animals and ambulance service was introduced by the company for the first time in the state. The milk producers purchased the equipments easily with the subsidy provided by the company. The company is managed by the directors efficiently as they meet regularly and the various committees also take care of their respective committees and decisions are taken democratically. Thus the Company has performed well in terms of increasing producers’ incomes. The various activities taken up the company for the production and social development like subsidy on technical equipment, medical and ambulance services, animal health care, breed development activities, animal welfare activities, feed and fodder development scheme, loans for purchasing milch animals, milch animals induction and financial assistance for the dead animals, bank loans, insurance scheme, marriage gifts, funeral charges, pension schemes and educational encouragement awards, scholarships and milk day celebrations have shown an impact on the farmers’ wellbeing.