[pib] New Schemes for Co-operatives

Why in the News?

The Ministry of Cooperation, since its inception on 6th July 2021, has taken many initiatives to strengthen and deepen the cooperative movement at the grassroots level.

What is a Co-operative?

A cooperative is “an autonomous association of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations through a jointly-owned enterprise”.
Cooperatives are democratically owned by their members, with each member having one vote in electing the board of directors.

Evolution of Cooperatives in India:

Pre-Independence Era:

First Cooperative Act (1904): Enacted after the Indian Famine Commission (1901) suggested cooperative credit societies to tackle rural debt.
Cooperative Societies Act (1912): Amended the 1904 Act to include non-credit societies and support the cooperative movement.
Maclagan Committee (1915): Evaluated the cooperative movement’s economic and financial stability.
Montague-Chelmsford Reforms (1919): Made cooperation a provincial subject, boosting regional cooperative initiatives.
Post Economic Depression (1929): Various committees in regions like Madras, Bombay, Travancore, Mysore, Gwalior, and Punjab restructured cooperatives.
Gandhian Influence: Gandhi promoted cooperatives for a socialistic society and decentralization. Established the Phoenix Settlement and Tolstoy Farm as cooperative settlements in South Africa.

Post-Independence Era:

First Five-Year Plan (1951-56): Emphasized cooperatives for comprehensive community development.
Multi-State Co-operative Societies Act (2002): Regulated the formation and functioning of multi-state cooperatives.
- Amendment (2022): Introduced the Co-operative Election Authority to oversee board elections in multi-state cooperatives.
97th Constitutional Amendment (2011): Made the right to form cooperatives a fundamental right under Article 19.
- Added Part IX-B to the Constitution, establishing “The Co-operative Societies” (Articles 243-ZH to 243-ZT).
- Empowered Parliament to legislate for multi-state cooperative societies and state legislatures for other cooperatives.
Union Ministry of Cooperation (2021): Created to oversee cooperative affairs, previously under the Ministry of Agriculture.

Initiatives Making Primary Cooperatives Economically Vibrant and Transparent

	Details
Model Bye-Laws for Primary Agricultural Credit Societies (PACS)	Prepared and circulated to all States/UTs. Enables PACS to undertake over 25 business activities. Adopted by 32 States/UTs.
Establishing New Multipurpose PACS/Dairy/Fishery Cooperatives	Plan to cover all Panchayats/villages in 5 years. 6,844 new PACS, Dairy, and Fishery cooperative societies registered.
World’s Largest Decentralized Grain Storage Plan	Create warehouses and agri-infrastructure at PACS level. Pilot project extended to 500 additional PACS.
Formation of New Farmer Producer Organizations (FPOs) by PACS	1,100 additional FPOs to be formed by PACS. 992 FPOs formed by NCDC.
PACS Given Priority for Retail Petrol/Diesel Outlets	Included in Combined Category 2 (CC2) for allotment. 270 PACS from 25 States/UTs applied online.
PACS Eligible for LPG Distributorship	Allowed to apply for LPG distributorships. 31 PACS from four States/UTs submitted applications.
PACS as Pradhan Mantri Bharatiya Jan Aushadhi Kendra	Promote PACS to operate Janaushadhi Kendras. 2,594 PACS given initial approval, 674 received drug licenses.
PACS as Pradhan Mantri Kisan Samriddhi Kendras (PMKSK)	Ensure easy accessibility of fertilizer and related services. 38,141 PACS functioning as PMKSK.
Convergence of PM-KUSUM at PACS Level	Farmers can adopt solar agricultural water pumps and install photovoltaic modules.
Micro-ATMs to Bank Mitra Cooperative Societies	Provide doorstep financial services. 2,700 micro-ATMs distributed in Gujarat.
Rupay Kisan Credit Card to Members of Milk Cooperatives	Provide credit at lower interest rates. 48,000 Rupay KCC distributed in Gujarat.
Formation of Fish Farmer Producer Organization (FFPO)	69 FFPOs registered by NCDC. Department of Fisheries allocated work to convert 1000 fisheries cooperative societies into FFPOs.

Initiatives Strengthening Urban and Rural Cooperative Banks

	Details
Urban Cooperative Banks (UCBs) Allowed to Open New Branches	Open up to 10% (max 5 branches) without prior RBI approval.
Doorstep Services by UCBs	Provide banking facilities at home.
Extended Time Limit for Priority Sector Lending (PSL) Targets	Timeline extended to March 31, 2026.
Nodal Officer in RBI for UCBs	Designated for regular interaction.
Increased Housing Loan Limit by RBI	Doubled for UCBs to Rs. 60 lakhs. Increased to Rs. 75 lakhs for Rural Cooperative Banks.
Rural Cooperative Banks Lending to Real Estate/Residential Housing	Diversify business to benefit Housing cooperative societies.
Non-scheduled UCBs, StCBs, and DCCBs Notified as MLIs in CGTMSE Scheme	Risk coverage up to 85% on loans.
Doubled Monetary Ceiling for Gold Loan by RBI	Increased from Rs. 2 lakhs to Rs. 4 lakh.
Umbrella Organization for UCBs	Approval given to NAFCUB for formation, providing IT infrastructure and operational support.

PYQ:

[2011] In India, which of the following have the highest share in the disbursement of credit to agriculture and allied activities?

(a) Commercial Banks

(b) Cooperative Banks

(d) Microfinance Institutions