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In the heart of Vidarbha, Maharashtra, a group of orange farmers struggled every year with falling prices and rising debts. Frustrated by middlemen and market volatility, they decided to form a Producer Company. Today, they operate cold storage units, export their produce, and sell under their own brand — all thanks to the collective strength of this unique business model.
If you're a farmer, rural entrepreneur, or agri-tech enthusiast, this article is your roadmap to understanding how Producer Companies are transforming India's agriculture and empowering its grassroots economy.
A Producer Company is a special type of entity registered under Section 581B to 581ZT of the Companies Act, 1956 (retained in Companies Act, 2013), created to serve the economic interests of primary producers such as farmers, milk producers, weavers, artisans, and fisherfolk.
Unlike a regular company, it is owned and managed by producers themselves with the goal of collective growth, shared profits, and mutual assistance.
Learn how to register a Producer Company hassle-free: https://www.twotax.in/service/bussiness-registration-services-by-twotax
To register a Producer Company in India, you need:
10 or more individual producers, or
2 or more producer institutions, or
A combination of both
Farmers and cultivators
Milk producers and dairy farmers
Fishermen and aquaculture operators
Rural artisans and handloom weavers
Beekeepers, horticulturists, and floriculturists
Example: A collective of beekeepers in Himachal formed a producer company to sell premium Himalayan honey. With a common processing unit and unified branding, they now supply to metropolitan markets and e-commerce platforms.
Production, harvesting, procurement, grading, pooling, handling, marketing, and selling of produce
Processing and packaging of agricultural goods
Manufacture and sale of machinery, tools, or inputs
Providing education and technical services
Promoting mutual assistance, welfare measures, and credit services
Import-export activities related to producer goods
Official Reference: https://www.mca.gov.in/content/dam/mca/pdf/Producer_Company.pdf
Legal Recognition: Registered as a corporate entity with the ROC
Limited Liability: Members' personal assets are protected
Perpetual Existence: Not affected by changes in membership
One Member, One Vote: Democratic decision-making regardless of shareholding
Tax Benefits: Agriculture-related income is exempt under Section 10(1) of the Income Tax Act
Direct Market Access – Sell directly to buyers, retail chains, or even export
Bargaining Power – Pooling produce helps negotiate better prices
Cost Reduction – Bulk purchase of seeds, fertilizers, and equipment
Credit & Finance – Easier access to government-backed loans
Government Grants & Schemes – Eligibility for NABARD, SFAC, and other schemes
Sustainable Income – Reduces dependence on monsoon or market middlemen
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Digital Signature Certificates (DSC) for all directors
Director Identification Numbers (DIN)
Company Name Reservation via the MCA RUN portal
Drafting of MOA & AOA (mentioning Producer Company objectives)
Filing SPICe+ Form on MCA portal for incorporation
Certificate of Incorporation Issued by ROC
Apply for PAN, TAN and Open a Bank Account
Annual filing of financials and returns (Form AOC-4, MGT-7)
Regular board and general meetings
Statutory audits and ROC filings
Maintenance of proper books of accounts
Income Tax filings and GST (if applicable)
Explore compliance services from TwoTax: https://www.twotax.in/service/regulatory-services
Facing dying demand and low wages, a group of weavers launched their own Producer Company. With help from NGOs and digital platforms, they now sell globally and employ over 200 artisans.
60+ milk producers formed a dairy-focused producer company. They installed a chilling unit, negotiated bulk sales with supermarkets, and tripled their profits in just 2 years.
Through a Producer Company, local fishermen gained cold storage units and direct market access. Their produce now reaches 5-star hotels and seafood exporters.
Build supply chain platforms for rural producers
Offer fintech solutions for agricultural finance
Enable direct-to-consumer (D2C) food and handicraft brands
Promote organic and climate-resilient farming practices
“A Producer Company brings business acumen to the grassroots. It’s not just a legal entity — it’s a movement. With proper guidance, rural producers can scale, innovate, and lead the way in building Atmanirbhar Bharat.”
NABARD – Capital and credit support
SFAC (Small Farmers' Agribusiness Consortium) – Equity grants and training
MCA Portal – Company registration and updates
Contact us today at www.twotax.in to start your journey toward empowered, self-sufficient rural entrepreneurship.
A Producer Company is more than a legal structure — it’s a path to dignity, prosperity, and self-reliance for rural India. Whether you’re a farmer dreaming of better prices or an agripreneur envisioning scale, the producer company model offers a sustainable, inclusive, and future-ready solution.
Let’s grow together, democratically, and profitably.
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