Farmer producer organizations (FPOs) have the potential to significantly aid smallholder agricultural development through the power of aggregation. In India, where most farms are smaller than a hectare, well-functioning FPOs can boost farm incomes through better market linkages and increased bargaining power. Recognizing that traditional cooperatives had limited success in helping small farmers, the Indian government amended the Companies Act in 2003 to allow the creation of producer companies. This change allowed 10 or more primary producers to form a company, enabling them to jointly access farm technology and information, buy inputs, and jointly sell their agricultural products in the market.

Since 2014, there has been a strong push to create FPOs across India. In 2020, the government allocated a budget of 6,865 crores of rupees to promote 10,000 FPOs by 2027-28. However, there is no single source of information on how many FPOs have been established and are currently functioning. This makes it challenging to gauge the success of these initiatives. Knowing the number of active FPOs is crucial to assessing the effectiveness of government support and other assistance, shaping better policies, and making necessary adjustments to improve the promotion and performance of FPOs in India.

The difficulty in counting FPOs in India

The mandate to promote FPOs in India does not lie with one agency. There are several nodal agencies called promoting organizations that fund the formation of FPOs. The Small Farmers’ Agri-Business Consortium (SFAC), under the Ministry of Agriculture, and the National Bank for Agriculture and Rural Development (NABARD), are the two largest promotors of FPOs. Additionally, organizations such as the National Cooperative Development Corporation (NCDC),  National Agricultural Cooperative Marketing Federation (NAFED), and livelihood missions of various states also currently promote FPOs. Donor organizations, such as the Walmart Foundation, also fund the promotion of FPOs in India. Promoting organizations often engage resource institutions or cluster-based business organizations (CBBOs)—NGOs or other civil society organizations—to mobilize farmers, form groups, and train them to function as producer companies.

Along with farmers, the FPO ecosystem comprises promoting organizations, resource institutions, funders, and investors (both government and non-government) as the main stakeholders. Some of these stakeholders have publicly available information regarding the number of FPOs they promote. However, there is no central organization or agency that consolidates and reports figures, making it impossible to know the exact number of FPOs.

Identifying and verifying FPO data

In 2019, when the Tata-Cornell Institute (TCI) began creating the FPO Hub to serve as a learning, information, and knowledge repository, our biggest challenge was determining the number of FPOs in the country. We designed a three-step process to consolidate data efficiently with the available resources. First, we consolidated secondary data from various promoting organizations and other publicly available sources. Second, as FPOs are required by law to be registered as companies, we acquired registration data from the Ministry of Corporate Affairs (MCA), Government of India. In the final step, we cross-referenced and validated the secondary data with the MCA data to get comprehensive information for a subset of FPOs. We explain the steps below:

Secondary data collection and preparation

We began by identifying the various sources of publicly available data on FPOs in India. The data sources included the largest promoting institutions: SFAC, NABARD, and 11 other public sources hosted by state governments and research institutions (detailed list in the appendix). The data was cleaned to correct inconsistencies and eliminate duplicates and redundancies. It also involved the creation of a unified code across data sources for crop names, and locations to ensure address lines, block, district, and pin codes, wherever available, were in the correct order. The cleaned data allowed for further analysis and integration into the database. The consolidation and cleaning of data ensured consistent and standardized information, enhancing the accuracy and usability of the data.

MCA data and search algorithms

FPOs, legally formed as producer companies under the Companies Act, are registered with the Registrar of Companies (ROC) under the Ministry of Corporate Affairs. They are also mandated to submit their financials (balance sheet, profit and loss, annual returns, etc.). This information is available from the Ministry of Corporate Affairs and is used by banks and non-banking financial companies (NBFCs) to understand companies’ financial health and profitability.

Using the services of Probe42, an information services company that provides information on Indian companies, we collated information on registered farmer producer companies. To improve the accuracy of the platform’s data retrieval and ensure the reliability of its information, an advanced search algorithm was developed. The Companies Act requires the names of producer companies to include the words “producer company limited,” thus we included the words “producer company,” “producers company,” “producers co.,” or “corp producer company” in our search criteria. Additionally, we used keywords like “farmer producer,” “farmer producer company,” “farmer producers,” and other closely related variants to capture all relevant entities.

The table below highlights the results of the search query for 2003-2024 and 2003-2021. The results identified 45,097 FPOs, and once we removed producer companies involved in nonagricultural activities, 44,460 producer companies registered were identified. 18,723 of them contain the term ‘farmer’ in 2024.

Search criteria for FPO discovery on the MCA database

Using names extracted from the reports published by SFAC and NABARD, as well as other databases, we next did a reverse corporate identification number (CIN) search on the MCA repository to verify all producer companies identified in secondary data and their operational status. The insights gained from the reverse CIN search helped refine the search criteria, enabling precise searches within the MCA repository for farmer producer companies.

Validation and consolidation of the dataset

The company information from the search results was augmented with sum of charges data, which verified a company’s active status. 15,455 producer companies with active status and up to date financial filings were identified, allowing for deeper financial analysis and validation of operational continuity.

The FPO information from the MCA repository has limited information regarding the characteristics and functions of FPOs. By integrating the MCA-acquired information with information from secondary sources, we consolidated detailed crop and business activity information for over 2,129 FPOs and 722 cooperatives.

Limitations of the dataset

A possible source of error in the dataset is that of exclusion: if a producer company did not have the words “producer company” (or their variants) in its name, it would not appear in our dataset. Second, our dataset may include companies registered as producer companies but engaged in activities that are not intended as primary activities of producer companies. As much as possible, we have screened units to remove such companies. the use of the variant “farmer producer company” has also helped reduce the number of non-relevant entities.

Furthermore, the dataset lacks comprehensive information on key variables such as crops cultivated, business activities undertaken, and shareholder details. This lack of granular data may impede a thorough understanding of the underlying dynamics and operational details of the producer companies. While we have used secondary data to fill in the data gaps, the sample size of FPOs with comprehensive information remains small.

It is also important to note that the financial information available in the dataset is limited to those producer companies that have submitted their balance sheets. However, there may be organizations that have not filed current reports, making it challenging to ascertain their operational status without additional verification processes.

These limitations underscore the need for exercising caution when interpreting results and drawing inferences from the dataset. Future research endeavors could benefit from more comprehensive data collection efforts, ensuring the inclusion of all relevant producer companies and capturing a broader range of variables to enhance the depth and reliability of the analysis.

Current database status 

After extensive data verification and updates, we arrived at a comprehensive list of 44,460 producer companies registered between January 1, 2003, and August 30, 2024. This includes 15,455 companies with complete financials; 11,482 companies incorporated before 2021 with complete financials; and detailed crop data for 2,129 producer companies and 722 cooperatives, all registered under various cooperative societies laws across India. 

Mathew Abraham is the assistant director of TCI.

Ekta Joshi is a TCI scholar and PhD student at Cornell University studying applied economics and management.

Dieter Bouma is a research support specialist at TCI.

Featured image: A farmer uses TCI’s FPO Platform for India to explore India’s FPO ecosystem. (Photo illustration by Tanuj Chawla/TCI)