A movement called ‘cooperatives’ is unique to India. Cooperatives engage citizens in a democratic manner at grassroot level. A cooperative society, as an organisation is owned and run by the people and for the people using its goods and services. The people or members of the organisation pool their resources for their common benefit and progress.
The first recorded instance of formation of Cooperative societies in India is in western Maharashtra in late 1890s. In 1904, the British government in India enacted the Cooperative Society Act.
After Independence, the government realised the significant role the cooperative sector plays in boosting the rural economy. In Five Year Action Plans, every village was encouraged to have at least one cooperative society. From agricultural markets, these Cooperative societies in India expanded to the credit sector, and later to other large-scale sectors, housing and development, fishing markets, banking, etc. This led to formation of different types of co-operative societies.
Dairy major Amul, flatbread manufacturer Lizzat Papad and fertiliser chain IFFCO are some of the examples of the successes reaped by the country’s cooperatives movement.
According to the National Cooperative Union of India data, India’s cooperatives sector is the largest in the world, with presence in 91 percent of villages across the country and with nine lakh registered cooperative societies, especially in the agricultural and agri-allied sector, banking, and housing sectors, with a membership of around 29 crore people. The fact that 29 percent of farm loans, 35 percent of urea production and 31 percent of urea distribution is done through cooperatives in the country, shows the kind of importance the Cooperatives have in the country. Cooperatives have immense social and national utility also and are among the first line of response in rescue missions in all situations from flood management to cyclone response. The cooperatives became the hub of India’s green and white revolution in the 20th century. According to the 2019-20 annual report by the National Dairy Development Board, these daily cooperatives had procured 4.8 crores litres of milk from 1.7 crore members. They also sold 3.7 crores litres of liquid milk per day. In the sugar sector, cooperatives are responsible for the production of more than 35 percent of the total sugar produced in the country.
But, the brightest feature of India’s cooperatives sector is the augmentation of India’s farm productivity.
The game changer
The cooperative movement in the country regained the spotlight after the Central Government created the Ministry of Cooperation In July 2021, with the futuristic vision of ‘Sahkar se Samriddhi,’ to provide a separate administrative legal and policy framework for streamlining the cooperatives, indicating the importance of the Cooperatives. The Cooperatives Ministry has chalked out a strategy for aligning cooperatives in India’s future growth story.
Furthermore, the government of India decided to connect India’s cooperatives movement with the International Cooperative Alliance (Global) that consists of 3 million cooperatives from 110 countries. In mid-January, 2022, India signed an agreement with the International Co-Operative Alliance Asia And Pacific (ICAAP). The plan is to assimilate and develop further on the core strengths, experience, and institutional objectives in the interest of advancement of research, study, documentation, and training for development of the cooperative sector.
But, as the core part of its cooperative policy, the government of India wants to scale up productivity numbers along with providing job opportunities to crores of people. So much so that Union Cooperatives minister Amit Shah has announced – “in the coming days, the area of cooperation is going to make the largest contribution towards realising PM Narendra Modi’s dream of a 5 trillion-dollar economy”.
On 15th March, 2022, Union Minister of State for Animal Husbandry, Dairies and Fisheries Sanjeev Balyan said in the Lok Sabha, that the Centre is providing financial assistance to set up dairies across the country through various schemes, including dairy processing and infrastructure development fund and the national programme for dairy development. The objective of the Dairy Processing and Infrastructure Development Fund (DP&IDF) is to create and strengthen milk processing and value addition infrastructure for dairy cooperative, multi-state dairy cooperative, milk producer companies, National Dairy Development Board (NDDB) and its subsidiaries, registered self-help groups (SHGs) and farmer producer organisations.
Another new height for the cooperatives sector was achieved in November, 2021, when the country’s first-of-its-kind, dedicated fisheries business incubator to be known as LINAC- NCDC Fisheries Business Incubation Centre (LlFlC) was inaugurated in Gurugram.
It aims to encourage initiatives among entrepreneurs providing them handholding in the fisheries sector to move towards Atma Nirbharta. The incubator costs Rs 3.23 crore. The incubation unit would provide hand holding such as training, converting entrepreneurial ideas into business models and doling out seed money to the new as well as the existing business entrepreneurs associated with cooperatives keen to make big in the segment.
Besides the economic growth and the increase in disposable incomes, the cooperatives ensure a widespread distribution of the income on the micro level.
