The Netherlands Development Finance Company (FMO) has announced €15m (US$16.5m) in funding for Indian farmer producer company (FPC), Sahyadri, as part of the development bank’s social impact fund.
The investment will help Sahyadri with the construction of collection centres for the warehousing and transport of produce, distribution centres with cold storage facilities and a fleet of refrigerated trucks for managing logistics and transport.
Additionally, Sahyadri plans to use the funding to set up retail stores in parts of Mumbai, Pune and Nashik, and expand its existing production.
“This financing is expected to give a boost to the agriculture and food processing operations of Sahyadri and reduce wastages and spoilage,” said FMO in a statement.
“FPCs, like Sahyadri, provide an effective platform for the provision of farm production inputs and marketing of output; this can immensely enhance farm productivity and increase farm income, thereby contributing to the reduction of poverty,” it added.
“Farmers benefit from economies of scale, technology-driven enhancements, marketing of the products and adequate facilitation to realize higher returns.”
As an FPC, Sahyadri procures, processes and markets fruits and vegetables from its network of about 7,000 smallholder farmers, which grow fresh produce such as grapes and vegetables.
Some of its products are exported to parts of Europe, the US, the Middle East and Asia.
Vilas Shinde, chairman and managing director of Sahyadri, said this kind of investment marks a milestone for the entire industry.
‘‘The decision by the FMO to funding for a Farmers Producer Company in India should be considered promising and proud moment not only for Sahyadri but entire FPC movement in the country,” Shinde said.
“It is very important for farmers to come together through the FPC and build the collective strength of marginal farmers. Having achieved this, it is easier to acquire the proper markets, technology and funding.’’