Farmer Producers Company as New Generation Cooperative: Strategic Challenges and New Dimensional Opportunity

Abstract

Traditional cooperatives have lost their vibrancy due to many issues and challenges such as inefficiency in operations, elite capture and politicization. The evolution of farmer producers company (FPC) as the new generation cooperative has been brought with a hope to commensurate the gaps present within traditional cooperative and corroborate with higher benefits to marginal and small farmers. Farmer producers company Act of 2002 is considered as the new generation cooperative which collectivise the efforts of the member farmers and intensify their unity through the provision of aggregation and collective marketing. FPC has the potential to overcome the distress of the farmers through various mechanisms. The FPC which was brought with a hope since last two decades under Prof Y.K. Alagh Committee faces certain dynamic challenges within the pervasive business environment. Despite of major initiative, policies, extending grant and schemes, FPC mark the question of strengthening stability and sustainability. The paper has attempted to answer the following questions a) what is the background of the new generation cooperative? b) What are the challenges remain with the new generation cooperatives? and c) What are the new dimensional opportunities with farmer producers company that could retain farmers with better economic return? The paper has reviewed the status, challenges, opportunity along with the fiscal measures on FPC based on both literature and secondary data.