The Role of the Co-Operative Sector In the Economic Environment of India

Co-operative idea took a concrete shape in India for the first time in 1904 when the Co-operative Credit Societies Act—a measure designed to combat rural indebtedness and provide for registration of credit societies— was passed.

Later in 1912, the Co-operative Societies Act also provided for registration of non-credit societies as well as federations of co-operatives.

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Since then the co-operative movement has made noticeable progress, especially in agricultural credit, marketing and processing of agricultural produce, supply of farm inputs and distribution of consumer goods.

An idea of the growth of co-operative movement in India can be had from the fact that there were as many as 3.50 lakhs co-operative societies of all types with the total membership of about 16 crores and total working capital of about Rs. 62,500 crore as on June 30, 1990.

Other distinguishing feature of the co-operative scene is that it is largely village- based. Government’s emphasis on institutionalisation of distribution of inputs to farmers and marketing of their agricultural produce through co-operatives owned by them has helped a great deal in strengthening co-operative sector in the rural areas.

By June 1989, there were 93,000 Primary Agricultural Credit Societies operating in the rural areas. Membership of these societies comprised of 9.20 crore persons. Co-operatives occupy an important place in the field of village and small industries and handloom weaving.

As on June 30, 1989, there were 53,786 industrial co-operatives with a membership of 43.76 lakhs. The National Federation of Industrial Co­operatives was set up in 1966 with a view to assisting the marketing of products of the member societies.

The total number of co-operative spinning mills installed was 10,948 in the growers’ sector and 61 in the weavers’ sector with a capacity of about 29.13 lakh spindles which was about 11 per cent of total spindlage in the country.

Functional co-operatives for programmes like dairy, fishery and poultry mainly extend help to the weaker sections; as such co-operatives provide increased employment and income opportunities to different sections like small and marginal farmers and fishermen. The National Co-operative Development Corporation (NCDC) also gives financial assistance to various types of co-operatives.

Co-operative societies are a state subject under the Constitution. However, such co-operative societies having their objects not confined to one State, come under the jurisdiction of Central Government.

The Multi-State Co­operative Societies Act, 1984 came into operation from September 16, 1985. At present, there are 182 Multi-State Co­operative Societies in the country.

A major development after independence has been the emergence of the National Co-operative Federations which added a new dimension to the co-operative infrastructure.

With the National Co-operative Union of India at the apex, other National Level Co-operative Federations established in the country are: National Agricultural Co-operative Marketing Federation, National Federation of State Co-operative Banks, National Federation of Co-operative Sugar Factories, National Co-operative Agriculture and Rural Development Banks’ Federation, National Co-operative Consumers’ Federation,

National Federation of Industrial Co-operatives, All India Federation of Co-operative Spinning Mills, National Co­operative Housing Federation, National Co-operative Dairy Federation, National Federation of Urban Co-operative Banks and Credit Societies, National Federation of Fishermen’s Co­operatives, National Federation of Labour Co-operatives and National Co-operative Tobacco Growers Federation.

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