Under the existing system, farmers frequently confront an “inverted pricing cycle” – they buy inputs at retail rates but end up selling their produce at wholesale prices, leading to poor returns.

At a gathering in New Delhi on Tuesday, the Federation of Hotel and Restaurant Associations of India (FHRAI) convened the FPO–Hospitality and Farmers’ Benefit Summit 2025, calling for a structured pivot in how India’s hospitality industry sources food. Addressing stakeholders, Devesh Chaturvedi, Secretary of the Department of Agriculture and Farmers’ Welfare, urged hotels and restaurants to forge long-term direct procurement partnerships with Farmer Producer Organisations (FPOs), rather than rely on traditional middlemen.

Chaturvedi described the model as a “powerful win-win” – offering hotels reliable access to high-quality, largely chemical-free produce, while enabling farmers to earn fairer, stable incomes. He noted that with almost 40,000 FPOs now active across the country, many already produce items suitable for hospitality demand.

Under the existing system, farmers frequently confront an “inverted pricing cycle” – they buy inputs at retail rates but end up selling their produce at wholesale prices, leading to poor returns. Direct sourcing by hotels, Chaturvedi argued, could help correct this imbalance, eliminating intermediaries, ensuring supply-chain integrity, and raising farmer profitability.

Agriculture and Tourism Ministries Flag Win-Win Gains for Farmers and Hotels

Leaders from both the agriculture and tourism sectors lent strong support to the proposed integration. The summit saw participation from industry stalwarts, including senior representatives from hotel chains, agribusiness consultants, FPO leaders and chefs – all endorsing a move toward collaborative procurement.

Suman Billa, additional secretary and director general, ministry of tourism, called for a fast-tracked national framework to institutionalise farmer–hotel partnerships. According to Billa, such a model can uplift rural livelihoods, strengthen tourism-linked value chains and provide hotels with a dependable supply of clean, safe produce – meeting growing demand for quality and sustainability.

Hotel and industry bodies, including FHRAI leadership, responded with readiness: as long as supply is consistent and quality assured, they said, they are open to direct procurement from FPOs.

Support for organic produce, GI-tagged regional items, and responsible tourism was highlighted as central to the government’s broader push – with models such as the community-based “Kumarakom model” from Kerala cited as benchmarks for sustainable industry–community linkages.

Pilot Framework and FPO Showcase Point to Scalable Change

A major feature of the summit was a curated exhibition where 50 FPOs from 17 states presented their produce. Displayed items ranged from Himalayan saffron, Kashmiri mamra almonds, black turmeric, forest honey, to makhana, regional rice varieties and yellow tea – many GI-tagged or organically grown. This exhibition not only underscored India’s agricultural diversity but also provided FPOs invaluable institutional visibility, aligning their outputs with market needs of premium hotels and restaurants.

During a technical session moderated by food-writer Sourish Bhattacharya, experts from agribusiness, hotel supply-chain management, and consulting firms laid out the contours of an operational “farm-to-hospitality” blueprint – envisioning robust logistics, quality standards, supply-chain coordination and demand forecasting.

According to industry insiders, if scaled up nationally, the model could reshape how India’s hospitality sector sources food – unlocking better returns for farmers, reducing reliance on intermediaries, and strengthening food-supply resilience amid rising demand from tourism growth.

What this Means for India’s Rural Economy and Hospitality Sector

• For farmers, particularly smallholders associated with FPOs, direct procurement offers a route out of chronic price distortions and unpredictable demand. By securing long-term contracts with hotels, they can achieve better income stability and fairer remuneration.
• For hotels and restaurants – especially those catering to domestic and international tourists – partnering with FPOs promises supply of high-quality, fresh, regional and often organic produce, aligning with growing consumer demand for authenticity and sustainability.
• For India’s broader economy, this emerging supply-chain model supports rural livelihoods, reduces wastage, boosts tourism-linked value creation, and strengthens linkages between agriculture, food, and hospitality industries.
• For the future, if the framework is standardised nationally and backed with logistics, cold-chain infrastructure and digital procurement platforms, it could become a transformative element in India’s food-economy ecosystem.