Fiinovation - Role of Cooperatives in the Indian Economy - 6th July International Day of Cooperatives

The role of cooperatives in the Indian economy has been there since a long time mostly in Agriculture and allied sectors. The cooperative movement was found by farmers to be a striking mechanism for gathering their resources for solving common problems relating to credit, supplies of inputs and marketing of agricultural produce. Cooperatives became an integral part of five year plans for faster removal of poverty and faster economic growth. India has a large number of cooperatives in various sectors but the scenario is not a pleasant one and very few especially in Dairy sector have been a success. 

The cooperatives are more focused in welfare rather than being business oriented. They are mostly controlled by the state and are more arms of the state than business enterprises. The failures which attributed to the downfall of this movement are dormant membership and lack of active participation of members, increasing overdue in credit, lack of mobilization of internal resources, over-dependence on government assistance, lack of professional management, bureaucratic control and interference in the management and political interference. 

Cooperatives and other various forms of community enterprises are already present in the economic structure, especially in the developing countries. Nevertheless, the benefits of co-operatives cannot be realized without giving due importance to gender inequality. Developing cooperatives of women groups helps in building membership, capacity of the women in the rural areas and is essential for increasing work participation. The regions where programs are being implemented for empowerment of women, they should be made aware of the benefits of creating women cooperatives or becoming members of existing ones. The members of the cooperatives should be made aware of the rights, roles of members and they should be sensitizing cooperative members and leaders to issues pertaining to women rights. 

The prices of commodities are rising day by day and women find it necessary to form cooperatives to address the problem of inflation and also the problem of adulteration which is an emerging social danger. The utilization of women workforce for productive purposes under the cooperative movement in India, this will definitely boost the National Income and help our nation achieve social development.

 

The way forward will be giving this movement suitable legislation and policy support like centralization of the cooperative act. NGOs should take cognizance about the prevailing situation and take necessary steps to improve the condition of the cooperatives. Decreasing the dependency on government assistance and making way for private donors who will create an effective business environment. Bringing in technical expertise and professional management into the cooperatives will boost the sales and decrease their credit overdue. It will strengthen the concept of cooperatives when private donors take the center stage and decrease the bureaucratic control and interference.