Indian Cooperative Movement
and Indian Agriculture
Dr A.K. Asthana
Institute of Cooperative Management
( Ministry of Agriculture, Govt of India)
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
• 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
• In 1892 Sir Federic Nicholson was directed to
study problem of farmers and give
• 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
• 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
• Village coverage - 98%
• House hold coverage -
• Cooperative movement has made tremendous
progress in every aspect of the Indian
• Initially cooperative movement was started
with agriculture credit only.
• But now it has entered into all field of
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
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
• Still after 100 years of initiation of cooperative
movement, the significance of cooperative of
agriculture and agriculturist has not
• Cooperative has significant contribution
in the following areas
1. Agriculture Credit
2. Agriculture Distribution
3. Agriculture Marketing
4. Agriculture Service
5. Agriculture based Industry
6. 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
Institutional Arrangement for Ag. Cre.
STATE LEVEL COOPERATIVE BANK
Fed. Of DCCBs
31 State Cooperative Bank
DISTRICT LEVEL CENTRAL COOPERATIVE BANK LTD
Federation of PACS
Primary Agriculture Credit Cooperative Society
Farmers are members for disbursement of agi loan ( 93413)
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.
STATE AGRICULTURE COOPERATIVE MARKETING FEDERATION
Apex fed. Of DACM
DISTRICT AGRICULTURE COOP MARKETING FEDERATION
Fed of AMCS
Primary Agriculture Marketing Cooperative Society
Primary Mar Soc 7202
• 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
• Marketing Cooperative society also provide
warehousing facility and transportation.
Institutional Arrangement for Ag. Mar.
STATE LEVEL COOPERATIVE MARKETING FEDERATION
Apex Fed. Distt. Mar. Coop. Fed
DISTRICT MARKETING COOP. SOCIETY LTD
Federation of PMCS
Primary Agriculture Marketing Cooperative Society
Farmers are members Pooing and Selling of Agri Produce ( 7202)
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
STATE MILK MARKETING FEDERATION
Federation of Distt Milk Union 21
DISTRICT Milk Processing Cooperative Union LTD
Federation of PMCS
Primary Milk Cooperative Society
( 1.22 Million)
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'
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
• 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 &
• 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
• 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
• 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
• From India AMUL , SEWA are internationally
acclaimed cooperative society.
• Dr Vergees Kurean of AMUL and Ela Bhatt has
international name in Cooperative