The Aryavarth Express
Agency (New Delhi): New Delhi, February 7, 2024 – The Ministry of Cooperation in India has been at the forefront of strengthening and revitalizing the cooperative movement in the country since its inception on July 6, 2021. With a vision of “Sahakar-se-Samriddhi,” the ministry has undertaken a remarkable 54 initiatives aimed at transforming the cooperative landscape from grassroots to national levels. These initiatives span various sectors, from agriculture to banking, and are set to have a profound impact on the socio-economic development of the nation.
1. Making Primary Cooperatives Economically Vibrant and Transparent
Model Bye-Laws for PACS: One of the foundational initiatives undertaken by the Ministry of Cooperation is the creation of Model Bye-Laws for Primary Agricultural Credit Societies (PACS). These bye-laws transform PACS into multipurpose, multidimensional, and transparent entities. With provisions that allow PACS to engage in more than 25 business activities, improve governance, transparency, and accountability, they have set the stage for the revitalization of grassroots cooperatives. Furthermore, provisions have been made to ensure inclusive membership, giving adequate representation to women and Scheduled Castes/Scheduled Tribes. A significant achievement is that 32 states/union territories have adopted these Model Bye-Laws or aligned their existing bylaws with them.
Strengthening of PACS through Computerization: Another monumental step is the approval of a project for the computerization of 63,000 functional PACS. With a total financial outlay of ₹2,516 Crore, this project aims to bring all functional PACS in the country onto a common ERP-based national software. This initiative is geared towards enhancing the efficiency and transparency of PACS operations. The software is ready, and ERP onboarding has already begun in 15,783 PACS across 27 states/union territories.
Establishing New Multipurpose PACS/Dairy/Fishery Cooperatives: To further broaden the reach of cooperatives, the government has sanctioned a plan for establishing new multipurpose PACS, primary dairy cooperatives, and fishery cooperatives, covering all Panchayats and villages in the next five years. This initiative, supported by NABARD, NDDB, NFDB, NCDC, and other national-level federations, is already in progress, with over 9,000 new cooperative societies in various stages of registration.
World’s Largest Decentralized Grain Storage Plan: An ambitious plan to create warehouses, custom hiring centers, primary processing units, and other agricultural infrastructure for grain storage at the PACS level has been approved. This plan involves converging various government schemes and will significantly reduce food grain wastage and transportation costs while improving farmers’ income. Over 2,000 PACS have been identified for the creation of storage capacity under this pilot project.
PACS as Common Service Centers (CSCs): The Ministry of Cooperation, in collaboration with MeitY, NABARD, and CSC e-Governance Services India Limited, has signed an MoU to provide more than 300 e-services through PACS. These services include banking, insurance, Aadhar enrollment/updation, health services, PAN card, and IRCTC/bus/air ticket services. So far, 30,647 PACS have commenced providing CSC services, aiming to increase their income while benefiting rural citizens.
Formation of New Farmer Producer Organizations (FPOs) by PACS: In a bid to empower farmers and provide them with essential market linkages, the government has permitted the formation of 1,100 additional FPOs by PACS. This initiative is particularly important in blocks where FPOs have not yet been formed or are not covered by other implementing agencies. Additionally, 672 FPOs have been formed in the cooperative sector with support from NCDC, further bolstering the cooperative movement.
PACS Given Priority for Retail Petrol/Diesel Outlets: In a groundbreaking move, PACS have been allowed to apply for retail petrol and diesel outlets. Oil Marketing Companies (OMCs) have already received online applications from 240 PACS across 26 states/union territories, with 39 PACS selected thus far.
PACS Given Permission to Convert Bulk Consumer Petrol Pumps: Based on discussions with the Ministry of Petroleum and Natural Gas, guidelines have been issued to enable the conversion of existing bulk consumer licensee PACS into retail outlets. A total of 109 PACS from four states have consented to this conversion, with 43 PACS receiving Letters of Intent (LOI) from OMCs.
PACS Eligible for LPG Distributorship: Another noteworthy achievement is the government’s decision to allow PACS to apply for LPG distributorships. This provides PACS with an opportunity to diversify their economic activities and generate new employment opportunities in rural areas, with nine PACS from three states/union territories already submitting online applications.
PACS as PM Bharatiya Jan Aushadhi Kendra: The government is promoting PACS to operate Pradhan Mantri Bhartiya Janaushadhi Kendras (Jan Aushadhi Kendras) to provide generic medicines at the rural level. This initiative not only serves as an additional income source for PACS but also enhances access to affordable medicines for rural citizens. A significant number of PACS have already applied to operate Jan Aushadhi Kendras, with several receiving drug licenses.
PACS as Pradhan Mantri Kisan Samriddhi Kendras (PMKSK): PACS have been encouraged to operate as PMKSK to ensure easy accessibility of fertilizers and related services to farmers across the country. As per the information shared by states/union territories, over 35,000 PACS are functioning as PMKSK.
Convergence of PM-KUSUM at PACS Level: PACS have been empowered to facilitate the adoption of solar agricultural water pumps and the installation of photovoltaic modules in farms, promoting sustainable agricultural practices.
PACS to Carry Out O&M of Rural Piped Water Supply Schemes: Recognizing the deep reach of PACS in rural areas, the Ministry of Cooperation, in collaboration with the Ministry of Jal Shakti, has designated PACS as eligible agencies to carry out the Operations & Maintenance (O&M) of rural piped water supply schemes. This initiative has identified 1,630 PACS selected by 14 states/union territories to provide O&M services at the Panchayat/village level.
Micro-ATMs to Bank Mitra Cooperative Societies: To enhance financial inclusion and ease of doing business for dairy and fisheries cooperative societies, Micro-ATMs are being provided to these Bank Mitra Cooperative Societies. As a pilot project, 1,723 Micro-ATMs have been distributed in Panchmahal and Banaskantha Districts of Gujarat, with plans to expand this initiative across the state.
Rupay Kisan Credit Card to Members of Milk Cooperatives: To extend financial support to members of dairy cooperative societies, Rupay Kisan Credit Cards (KCCs) are being distributed. This initiative, initially implemented in Panchmahal and Banaskantha Districts of Gujarat, is now being expanded to all districts of the state.
Formation of Fish Farmer Producer Organization (FFPO): In a move to provide market linkage and processing facilities to fishermen, Fish Farmer Producer Organizations (FFPOs) are being registered. The Ministry of Cooperation, in association with NFDB, has initiated this scheme, with 260 FFPOs registered so far.
Strengthening Urban and Rural Cooperative Banks: To bolster the cooperative banking sector, the government has implemented various measures. These include increasing the lending limit for Urban Cooperative Banks (UCBs), allowing UCBs to open new branches without prior approval, and providing doorstep banking services to customers. Additionally, the government has extended the timeline for UCBs to achieve Priority Sector Lending (PSL) targets and made UCBs eligible for risk coverage on loans under the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) scheme.
Nodal Officer for RBI Interaction with UCBs: To streamline communication and address the concerns of UCBs, a nodal officer has been designated for RBI interaction with these banks. This step aims to improve the functioning and compliance of UCBs with RBI regulations.
Higher Housing Loan Limits for Cooperative Banks: The government has increased the housing loan limits for both urban and rural cooperative banks, thus enabling them to cater to the housing needs of a wider range of customers.
Lending to Commercial Real Estate/Residential Housing by Rural Cooperative Banks: Rural Cooperative Banks have been permitted to engage in lending to commercial real estate and residential housing, broadening their business scope.
Reduced License Fee for Cooperative Banks: To facilitate the onboarding of Cooperative Banks to ‘Aadhaar Enabled Payment System’ (AePS), the government has reduced the license fee. This initiative promotes the digitization of transactions and financial inclusion.
Cooperatives as Member Lending Institutions (MLIs) in CGTMSE Scheme: Cooperative banks are now eligible to become Member Lending Institutions (MLIs) under the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) scheme. This inclusion provides cooperative banks with the opportunity to offer collateral-free credit to small businesses while ensuring risk coverage.
Scheduling Norms for Urban Cooperative Banks: The Ministry of Cooperation has established new eligibility criteria for scheduled status for Urban Cooperative Banks (UCBs). These criteria will enhance the credibility and recognition of UCBs.
Increased Monetary Ceiling for Gold Loans: In an effort to boost lending activities, the government has doubled the monetary ceiling for urban cooperative banks that meet their PSL targets, allowing them to extend more gold loans.
Umbrella Organization for Urban Cooperative Banks: The government has approved the establishment of an Umbrella Organization (UO) for Urban Cooperative Banks, aiming to strengthen and support these banks. The UO will help UCBs in raising capital, strengthening governance, and improving risk management.
Relief to Cooperative Societies in the Income Tax Act: Cooperative societies have received a much-needed relief in the form of reduced surcharge and Minimum Alternate Tax (MAT) under the Income Tax Act. This measure promotes the growth of cooperatives by reducing their tax burden.
Relief in Cash Transactions under IT Act: Clarifications have been issued regarding cash transactions by cooperative societies under Section 269ST of the Income Tax Act. These clarifications ensure that genuine cooperative societies are not unduly burdened with income tax provisions.
Tax Cut for New Manufacturing Cooperatives: New cooperatives in the manufacturing sector have been granted reduced tax rates to incentivize their growth and development.
Increased Cash Deposits and Cash Loans Limits for PACS and PCARDBs: In a move to promote ease of business, the government has enhanced the limits for cash transactions by cooperatives, allowing them to conduct their financial operations more efficiently.
Limit Increase for Tax Deducted at Source (TDS) in Cash Withdrawal: The government has increased the cash withdrawal limit without TDS for cooperatives, providing them with more flexibility in their financial transactions.
Relief from Income Tax to Sugar Cooperative Mills: Sugar cooperative mills have received relief from income tax, benefiting the sugar industry as a whole.
Resolution of Pending Income Tax Issues for Sugar Cooperative Mills: Long-standing income tax issues faced by sugar cooperative mills are being resolved, bringing much-needed relief to this vital sector.
Loan Scheme for Strengthening of Sugar Cooperative Mills: The Ministry of Cooperation has introduced a loan scheme aimed at strengthening sugar cooperative mills by financing ethanol plants, cogeneration plants, and working capital for sugar mills.
Preference to Cooperative Sugar Mills in Ethanol Procurement: Cooperative sugar mills are now treated at par with private companies for ethanol procurement, providing them with equal opportunities to participate in the ethanol market.
GST Reduction on Molasses: The reduction of GST on molasses benefits cooperative sugar mills by lowering input costs and making their products more competitive.
New National Multi-State Cooperative Seed Society: A new seed society has been established to focus on quality seed cultivation and distribution. This initiative aims to improve the availability of high-quality seeds for farmers across the country.
New National Multi-State Cooperative Organic Society: Another important addition to the cooperative sector is the establishment of an organic society dedicated to certified organic products. This initiative supports the growing demand for organic products in both domestic and international markets.
New National Multi-State Cooperative Export Society: A dedicated export society has been formed to promote the export of cooperative sector products. This society will help cooperatives explore new markets and expand their global presence.
Promotion of Training and Awareness through NCCT: The National Council for Cooperative Training (NCCT) has been actively conducting training programs and awareness campaigns to equip cooperative professionals and members with the knowledge and skills needed to succeed in the cooperative sector.
Cooperative University Establishment: The government is taking steps to establish a National Cooperative University, which will serve as a center of excellence for cooperative education, research, and training.
Computerization of Central Registrar’s Office: To create a digital ecosystem for Multi-State Cooperative Societies, the Ministry of Cooperation has initiated the computerization of the Central Registrar’s Office (CRO). This move will streamline the registration and governance of cooperatives at the national level.
Scheme for RCS Office Computerization: The Central Sponsored Project for the computerization of Registrar of Cooperative Societies (RCS) offices at the state/union territory level has been launched. This initiative aims to improve the efficiency and transparency of RCS operations.
Computerization of Agriculture and Rural Development Banks (ARDBs): The Ministry of Cooperation has undertaken a comprehensive computerization project for Agriculture and Rural Development Banks (ARDBs) across 13 states/union territories. This project will modernize ARDBs’ operations and enhance their service delivery.
New National Cooperative Database: The government is in the process of creating a comprehensive national database of cooperatives. This database will serve as a valuable resource for policymakers, researchers, and stakeholders in the cooperative sector.
Formulation of New National Cooperative Policy: A new National Cooperative Policy is in the works, which will provide a comprehensive roadmap for the growth and development of cooperatives in India. This policy will address the challenges faced by the cooperative sector and outline strategies for its sustainable development.
Multi-State Cooperative Societies (Amendment) Act, 2023: The Multi-State Cooperative Societies (Amendment) Act, 2023, includes amendments aimed at strengthening governance and transparency in multi-state cooperative societies. These amendments will enhance the regulatory framework governing multi-state cooperatives.
Inclusion of Cooperatives on GeM Portal: Cooperatives can now register as buyers on the Government e-Marketplace (GeM) portal, facilitating their procurement of goods and services.
Expansion of NCDC: The National Cooperative Development Corporation (NCDC) has been expanded to increase its role in the cooperative sector. This expansion includes the creation of a dedicated division for fisheries and aquaculture.
International Cooperative Partnership Initiative: The government has initiated the International Cooperative Partnership Initiative (ICPI) to promote international cooperation and collaboration in the cooperative sector. This initiative aims to strengthen India’s position in the global cooperative movement.
National Level Awards for Cooperatives: The Ministry of Cooperation has introduced national-level awards to recognize and honor outstanding contributions by cooperatives and individuals in the cooperative sector.
Promotion of Cooperative Start-ups: To encourage entrepreneurship in the cooperative sector, the government is promoting cooperative start-ups through various incentives and support programs.
2. Empowering Women in the Cooperative Sector
Recognizing the pivotal role women play in the cooperative sector, the Ministry of Cooperation has taken several initiatives to empower and promote their participation. These initiatives include:
Promotion of Women SHGs: The government is actively promoting the formation and strengthening of Women Self-Help Groups (SHGs) to provide women with a platform for economic empowerment.
Incentives for Women Entrepreneurship: Special incentives and support are being provided to women entrepreneurs in the cooperative sector to encourage their participation and leadership.
Women Entrepreneurship through Dairy and Fishery Cooperatives: The Ministry of Cooperation is promoting women entrepreneurship through dairy and fishery cooperatives, enabling women to actively participate in these sectors.
Reservation of Seats for Women in PACS: To ensure gender equality and representation, seats are reserved for women in Primary Agricultural Credit Societies (PACS).
Women-Centric Cooperative Societies: The government is actively encouraging the formation of women-centric cooperative societies, focusing on women’s needs and aspirations.
Support for Women-led Cooperatives: Financial and technical support is being extended to women-led cooperative societies to strengthen their operations and sustainability.
3. Financial Inclusion and Access to Credit
The Ministry of Cooperation has been instrumental in promoting financial inclusion and providing access to credit for rural and marginalized communities through various initiatives:
Strengthening of Cooperative Banks: Cooperative banks, including Urban Cooperative Banks (UCBs) and Rural Cooperative Banks (RCBs), have been strengthened to enhance their capacity to provide credit to the rural and urban poor.
Revival of Distressed UCBs: A special revival package has been designed for distressed Urban Cooperative Banks (UCBs) to help them overcome financial challenges and continue serving their customers.
Interest Subvention for Cooperative Credit: To make credit more affordable for farmers and cooperatives, the government provides interest subvention on loans disbursed by cooperative banks.
Enhanced Credit to Farmers: The Ministry of Cooperation is committed to increasing the credit flow to farmers through cooperative banks, enabling them to meet their agricultural and financial needs.
Support for Self-Help Groups (SHGs): The government is extending support to Self-Help Groups (SHGs) to facilitate their access to credit and financial services.
Promotion of Cooperatives as Business Correspondents (BCs): Cooperatives are being encouraged to act as Business Correspondents (BCs) for banks, extending banking services to underserved and remote areas.
Access to Kisan Credit Cards (KCCs): Farmers are being provided with easy access to Kisan Credit Cards (KCCs) to facilitate their credit needs for agricultural and allied activities.
4. Agriculture and Allied Sectors
Agriculture and allied sectors are at the heart of the cooperative movement in India, and the Ministry of Cooperation has introduced several initiatives to strengthen these sectors:
Cooperative Farming Clusters: The government is promoting the formation of cooperative farming clusters to enhance the productivity and income of small and marginal farmers.
Promotion of Agri-Start-ups: Support is being extended to agriculture-related start-ups and agri-entrepreneurs to encourage innovation and modernization in the sector.
Market Linkages for Farmers: Cooperatives are being equipped with market linkages and value addition facilities to ensure that farmers receive fair prices for their produce.
Cooperative Initiatives in Horticulture: The Ministry of Cooperation is actively promoting cooperative initiatives in horticulture to improve production, post-harvest management, and marketing.
Strengthening of Dairy Cooperatives: Dairy cooperatives are being strengthened and modernized to ensure better returns for dairy farmers and the availability of quality dairy products.
Promotion of Fishery Cooperatives: Fishery cooperatives are being promoted to support the livelihoods of fishermen and ensure sustainable fish production.
5. Credit and Capital for Cooperatives
Ensuring that cooperatives have access to credit and capital is crucial for their growth and sustainability. The Ministry of Cooperation has introduced various initiatives in this regard:
Cooperative Development Fund (CDF): The government has established the Cooperative Development Fund (CDF) to provide financial support to cooperatives for capacity building, modernization, and expansion.
Startup Funding for Cooperatives: Cooperatives and cooperative start-ups are being provided with funding support to foster innovation and entrepreneurship in the sector.
Credit Guarantee Fund for Cooperatives: The Credit Guarantee Fund for Cooperatives (CGFC) has been established to facilitate easy access to credit for cooperatives.
6. Digitalization and Technology Adoption
The Ministry of Cooperation recognizes the importance of digitalization and technology adoption in the cooperative sector and has undertaken several initiatives:
Digitization of Cooperatives: Cooperatives are being digitized to streamline operations, improve transparency, and enhance efficiency.
E-Governance in Cooperatives: E-governance is being promoted in cooperatives to facilitate online registration, transactions, and compliance.
Cooperative Mobile App: The government has developed a cooperative mobile app to provide cooperatives with a digital platform for various services.
7. Strengthening Regulatory Framework
To ensure the smooth functioning of cooperatives, the Ministry of Cooperation is working on strengthening the regulatory framework:
Amendment of Multi-State Cooperative Societies Act: Amendments to the Multi-State Cooperative Societies Act are being introduced to enhance governance, transparency, and accountability in multi-state cooperatives.
Strengthening Cooperative Auditors: The government is taking steps to strengthen cooperative auditors and ensure the quality and integrity of cooperative audits.
Cooperative Dispute Resolution Mechanism: A cooperative dispute resolution mechanism is being established to address disputes and conflicts within the cooperative sector.
8. International Cooperation and Partnerships
Recognizing the global importance of cooperatives, the Ministry of Cooperation is actively engaging in international cooperation and partnerships:
Cooperative Exchange Programs: The government is promoting exchange programs and collaborations with international cooperative organizations to share best practices and experiences.
Participation in International Cooperative Events: India is actively participating in international cooperative events and conferences to showcase its cooperative movement and learn from global experiences.
9. Awards and Recognition
To acknowledge and celebrate the contributions of cooperatives and individuals in the cooperative sector, the Ministry of Cooperation has introduced national-level awards:
National Cooperative Awards: National Cooperative Awards are conferred to recognize outstanding cooperatives and individuals for their exceptional contributions.
10. Training and Capacity Building
The Ministry of Cooperation places significant emphasis on training and capacity building to empower cooperative professionals and members:
National Cooperative Training Plan: The National Cooperative Training Plan is being implemented to provide training and capacity building to cooperative professionals and members.
Cooperative University: The establishment of a National Cooperative University is in progress to serve as a center of excellence for cooperative education, research, and training.
The Ministry of Cooperation in India has embarked on an ambitious journey to revitalize the cooperative sector and empower millions of citizens across the country. With 54 innovative initiatives spanning various sectors, the government is committed to promoting economic growth, financial inclusion, and social development through cooperatives. These initiatives not only strengthen the cooperative movement at the grassroots level but also enable cooperatives to participate in national and international markets. As India celebrates the spirit of cooperation, the future looks promising, with the potential to transform the socio-economic landscape of the nation.