Indian Cooperative Movement and Indian Agriculture

Dr A.K. AsthanaDirector

Institute of Cooperative Management( Ministry of Agriculture, Govt of India)

dearasthana@gmail.com

Glance on Development of Cooperative in India

• Cooperative movement in India is more than 100 years old.

• Cooperative movement in India started with enactment of “ The Cooperative Credit Society Act 1904”

• Main objective was to make farmers free from the clutches of money lenders.

• At that time money lenders used to charge 37% to 76% as interest on money lended to farmers.

• In 1892 Sir Federic Nicholson was directed to study problem of farmers and give suggestions.

• He submitted the reprot and suggested to

• Establish agriculture credit bank on line of one established by Mr Raiffeisen in Germany.

• In 1901 then government formed a committee to consider establishment of such bank.

• In 1904 Act was passed and cooperative was given legal status.

• This was bigning of agriculture credit cooperative society in India.

• In 1912 another Act was passed for setting up non-agriculture credit cooperative society in India. That created marketing cooperative society.

• In 1919 cooperative was made state ( at that time provincial subject)

• Cooperative movement in India is one of the largest movement in World.

• 545 thousand cooperatives• Membership range to 236 million• Working capital of Rs 34,00,555

million( credit and non credit cooperative society)

• Village coverage - 98%• House hold coverage -

• Cooperative movement has made tremendous progress in every aspect of the Indian economy.

• Initially cooperative movement was started with agriculture credit only.

• But now it has entered into all field of economic activities.

Role of Cooperative in Indian Economy

• In India there is private sector, government sector and cooperative sector contributing to the economy of nation.

• 97% villages are covered by cooperatives• 75% rural house hold are covered by coop.• Agriculture coop. disbursed 21% of loan to

farmers.

• Share of sugar production in coop is 46%• Share of handloom coop. is 54%• Rubber procurement and marketing 15%• Ice crème manufacturing 45%• Oil Marketed ( Branded) 49%• Direct employment generation 1.22 million• Self employment generated for person 15.47%

Indian Cooperative and Agriculture

• In the Indian context, it is pertinent to mention that a large segment of the population (65%) continues to depend on agriculture and agriculture related sectors of the economy.

• Still after 100 years of initiation of cooperative movement, the significance of cooperative of agriculture and agriculturist has not diminished.

• Cooperative has significant contribution in the following areas

1. Agriculture Credit2. Agriculture Distribution3. Agriculture Marketing

4. Agriculture Service 5. Agriculture based Industry6. Allied agriculture sector.

• 1. Agriculture Credit:• To increase the agriculture production, credit

is first requirment.• Farmers are provided agriculture credit

through cooperative institution at their door step.

Institutional Arrangement for Ag. Cre.

• Total membership of PACS 122 million• Total loan Advance • ST loan 82%• MT loan 17%• Loan advance for agriculture purpose 50%

• Agriculture Distribution• Apart from supplying credit , cooperative

institution in India also supply agriculture input like seed, fertiliser, pesticide, insecticide to the farmers again at door step.

• Cooperative ensure quality product at reasonable price to farmers. Farmers take advantage of bargain of bulk purchase.

Institutional Arrangement for Ag. dis.

• 3. Agriculture Marketing • Cooperative institution in India also give

marketing support to the farmers.• The produce of farmers are pooled at Village

level and market linkage is provided through federation.

• Marketing Cooperative society also provide warehousing facility and transportation.

Institutional Arrangement for Ag. Mar.

4. Agriculture Service:• Some times small and marginal farmers can

not buy costly agriculture implements like tractor, triller, theser etc.

• Service Cooperative society provide these implements on hire basis

• Irrigation coop Soceity

• 5. Agriculture Industry• Cooperative Institute also support a number

of agro based industry where farmers are directly or indirectly being benefitted.

• These industry provide direct employment, income generation employment and empowerment to womenfolk.

• 5a. Sugar Cooperative• A very prominent agro based industry in

India 9 state federation , • 324 Sugar cooperative factories in India

with Installed Capacity of 10 Million tones• Sugar factory provide credit, input, and

consultancy for member farmers• Purchase sugar can under buying agreement

• 5b. Dairy Cooperative• One of the largest and successful cooperative • Members 14.47 million• Dairy cooperative provide additional income

to the farmers • Employment generation for women 5 million• India has given AMUL MODEL to world for

dairy development.

AMUL MODEL

• No. of Producer Members 3.18 Million• No. of Village Societies16,914• Milk Collection (Total - 2012-13)4.66 billion litres• Members17 District Cooperative Milk Producers'

Unions• GCMMF Branding and sale of AMUL • Sales Turnover -(2012-13)Rs. 13735 Crores•

• 5c. Fertiliser Cooperatives• In India cooperative institute has entered into

production of fertiliser also because at peak time farmers felt shortage of it.

• IFFCO AND KRIBHCO

IFFCO

• Indian Farmers Fertilizer Cooperative Limited, also known as IFFCO, is the world's largest fertilizer cooperative federation based in India. IFFCO has 40,000 member cooperatives.

• IFFCO was established as the farmers’ own initiative in Cooperative Sector on 3rd Nov. 1967 with the proposed plants at Kalol & Kandla.

KRIBHCO

• KRIBHCO is primarily a fertilizer production cooperative having production unit at Hazira (Surat) in the state of Gujarat.

• It is urea company.

• Oman India Fertilizer Complex (OMIFCO), is the first overseas JV project of the company in which KRIBHCO holds 25 % equity

• At present KRIBHCO is marketing about 38.00 Lakhs MT of urea annually which is about 14% of the total urea consumption of the country.

• The major co-operative processing units in India are:• 1. Co-operative oil seeds processing units ( 142)• 2. Fruits and vegetable co-operatives( 54)• 3. Co-operative cold storage• 4. Co-operative processing of plantation crops• 5. Rice mills co-operatives ( 702) • 6. Cotton processing co-operatives• 7. Co-operative spinning mills• 8. Co-operative jute mills

Select feature of Indian Cooperative

• Two type of governance found in India• Cooperative movement in state Like Gujarat

and Maharastra, movement is led by members.

• In state like TN, Kerala movement is led by state government machiery

• Cooperative was state subject so every state frame rule according to its situation

• Not uniformity in administration and governance of cooperative in India

• WTO has impact on some of cooperative like sugar cooperative, milk cooperative etc.

• To tackle problem major cooperative reforms were need of day.

• In 2011, 97 constitutional amendment was passed and lots of discrepancy were removed.

• Now cooperative has become fundamental right empowering citizen to form cooperative as it is fundamental right.

Future of Cooperative

• Cooperative is diversifying in new area.• Cooperative in entering into power generation,

real estate management, insurance sector and health care sector, tele communication.

• From India AMUL , SEWA are internationally acclaimed cooperative society.

• Dr Vergees Kurean of AMUL and Ela Bhatt has international name in Cooperative