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Sustainability of Farmer Producer Organisations under Agricultural Value Networks in India: A Case of Punjab and Gujarat

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  • Singh, Gurpreet
  • Budhiraja, Parisha
  • Vatta, Kamal

Abstract

Small and marginal farmers constitute a majority in Indian agriculture but are integrated through traditional value networks which lack supportive environment with institutional and infrastructural system, inadequate resources and effective coordination within the value networks. Farmer Producer Organisations (henceforth, FPOs) are formed to integrate the small farmers with agricultural marketing system and offer remunerative prices with low transaction cost. With this understanding, this study explores the existing agricultural value networks and categorically makes a comparison between the FPO-led marketing system and the conventional models. It tries to investigate the efficacy and sustainability of FPO models and analyse the operational dynamics in two states of India, namely, Gujarat and Punjab. To examine the objectives of the paper, available data and literature along with information from field survey have been utilised. The study finds that the new initiative of linking farmers with the formal value networks through FPOs, which assumed as hybrids of co-operative model, seems ineffective for new entrants in the business. The formally active structures in agricultural marketing have taken the new shape under the FPO system which project the success of this model. One of the crucial determinants for the sustainability of FPO is institutional support that is not limited to the formation of FPO but provides new market linkages, adoption of agricultural best practices, and providing the managerial skills to the farmers.

Suggested Citation

  • Singh, Gurpreet & Budhiraja, Parisha & Vatta, Kamal, 2018. "Sustainability of Farmer Producer Organisations under Agricultural Value Networks in India: A Case of Punjab and Gujarat," Indian Journal of Agricultural Economics, Indian Society of Agricultural Economics, vol. 73(03), July.
    • Handle: RePEc:ags:inijae:343375
    DOI: 10.22004/ag.econ.343375
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    References listed on IDEAS

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    1. Singh, Sukhpal, 2002. "Contracting Out Solutions: Political Economy of Contract Farming in the Indian Punjab," World Development, Elsevier, vol. 30(9), pages 1621-1638, September.
    2. Johann Kirsten & Kurt Sartorius, 2002. "Linking agribusiness and small-scale farmers in developing countries: Is there a new role for contract farming?," Development Southern Africa, Taylor & Francis Journals, vol. 19(4), pages 503-529.
    3. Alain De Janvry & Elisabeth Sadoulet, 2005. "Achieving success in rural development: toward implementation of an integral approach," Agricultural Economics, International Association of Agricultural Economists, vol. 32(s1), pages 75-89, January.
    4. Singh, Sukhpal, 2002. "Contracting Out Solutions: Political Economy of Contract Farming in the Indian Punjab," 2002 ASAE 3rd International Conference, October 18-20, Jaipur, India 294714, Asian Society of Agricultural Economists (ASAE).
    5. Singla, Naresh & Singh, Sukhpal & Dhindsa, P.K., 2011. "Linking Small Farmers to Emerging Agricultural Marketing Systems in India—The Case Study of a Fresh Food Retail Chain in Punjab," Agricultural Economics Research Review, Agricultural Economics Research Association (India), vol. 24(01), June.
    6. Prabhu Pingali, 2007. "Agricultural growth and economic development: a view through the globalization lens," Agricultural Economics, International Association of Agricultural Economists, vol. 37(s1), pages 1-12, December.
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    Cited by:

    1. Pierre Chollet & Geoffroy Enjolras & Iciar Pavez & Louis‐Antoine Saïsset, 2026. "The sustainability performance of agricultural cooperatives: A systematic literature review," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 97(2), pages 321-367, June.
    2. Aditi & Rohit Kumar Rawat & Debashis Acharya & Jajati Keshari Parida, 2025. "Does Participation in Farmer Producer Organizations (FPO) Help Boost Farmers’ Income in India?," South Asia Economic Journal, Institute of Policy Studies of Sri Lanka, vol. 26(1), pages 77-94, March.
    3. Malik, Sushant & Kajale, Dilip, 2024. "Empowering Small and Marginal Farmers: Unveiling the Potential and Addressing Obstacles of Farmer Producer Organizations in India," Research on World Agricultural Economy, Nan Yang Academy of Sciences Pte Ltd (NASS), vol. 5(01), March.
    4. N. Lalitha & P. K. Viswanathan & Soumya Vinayan, 2024. "Institutional Strengthening of Farmer Producer Organizations and Empowerment of Small Farmers in India: Evidence from a Case Study in Maharashtra," Millennial Asia, , vol. 15(2), pages 278-299, June.

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