A new Ministry of Cooperation has been created to strengthen cooperative movement. This separate administrative structure was proposed in Union Budget earlier this year. New ministry is expected to streamline processes for cooperatives and realize the vision of ' Sahakar se Samriddhi'.
About Cooperative Movement in India:
In India there are 8.5 lakh cooperative credit societies with a total membership exceeding 28 crores. There are 55 types of cooperative societies.
The major number is from 7-8 categories. Primarily Milk cooperative societies, then Primary Agricultural credit societies, then Credit cooperative societies (4 types- urban area functioning, under rural areas but some don't extend agri- credit, workers and employees coming together to meet their credit requirement, lastly Mahila Jeevan cooperative credit societies), Fisheries cooperative societies (less in number compared to large coastline), Weavers cooperative credit societies (UP, Telangana, Andhra Pradesh etc), Housing cooperative societies all over the countries and finally free lance societies.
Financial - primary urban cooperative banks fully regulated by RBI, District central cooperative banks and each state has an Apex cooperative bank.
Assessment of cooperative based economic model
Cooperative movement in India is deep ingrained. Cooperative range from financial to non- financial institutions. In cooperatives there is a sense of responsibility. Origin- 1904; around 1950s it became extensive.AMUL is a well known cooperative structure.
Positives
Good, reliable opportunities for growth . It provide an opportunity for collective decision making.
Challenges:
Board structure should be more transparent and more accountable.
Rural sector- district sector and state cooperative banks: As the income from agriculture in the rural sector has declined drastically there these banks need a new business model to function.
The Milk cooperatives are a huge source of income for the farmers but the growth of the dairy sector is dismal. The North and north east do not contribute substantially to the dairy sector. There is a need for policies for supporting ancillary services for the dairy sector.
State cooperative Laws are not in tune with the current socioeconomic situation.
Access to capital for the cooperatives for their working capital needs and their empowerment.
How will the new ministry help in cooperative development?
With the coming up of handicraft and weavers cooperatives and so on the farmers income can be doubled. It will help in identifying other sectors where the cooperatives can come up which will be beneficial for the ones down the value chain. It will contribute towards economic growth and development.
What should be the key areas where the ministry should focus?
Rural India: Double farmers’ income can be achieved by growth of the food processing industry. India can learn from the Netherlands in this aspect. (agro processing in rural sector)
Mass housing through cooperative societies in urban areas as majority urban poor live in slums.
Consumer cooperatives in urban areas. There are none in the country with credible work. As these can act as a balancing sector.
Ease of doing business norms should be extended to all cooperatives so that they are able to function without obstructions.
Promote companies under the companies act which are formed by the cooperatives.
Cooperative should not be dependent only on govt or borrowing for capital. They have to reduce their cost of operations.
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