The Union Government has undertaken an extensive, multi-layered reform drive to strengthen India’s cooperative sector, making it more transparent, technology-driven and people-oriented, Union Minister for Cooperation Amit Shah informed the Lok Sabha in a written reply on Tuesday.
The initiatives, launched under the vision of “Sahakar-se-Samriddhi” since the creation of the Ministry of Cooperation in July 2021, cover primary to apex-level cooperatives across agriculture, banking, dairy, fisheries, sugar, education and exports.
Shah said India currently has around 8.4 lakh cooperative societies with nearly 32 crore members, and reforms are being implemented uniformly across all States and Union Territories. A central focus has been on revitalising Primary Agricultural Credit Societies (PACS) by introducing Model Bye-laws that allow more than 25 business activities, ensure inclusive membership and strengthen governance. So far, 32 States and UTs have adopted or aligned their bye-laws with the model framework.
Digitisation has been identified as a major reform pillar. Under a Rs 2,925 crore national project, 79,630 PACS have been sanctioned for computerisation, with over 61,000 PACS already onboarded on a common ERP-based software linked with NABARD, State Cooperative Banks and District Central Cooperative Banks. PACS have also been integrated as Common Service Centres, delivering more than 300 digital services in rural areas.
The Minister highlighted the world’s largest decentralised grain storage plan in the cooperative sector, under which warehouses, processing units and agri-infrastructure are being created at PACS level by converging multiple central schemes. Construction of godowns has been completed in over 100 PACS, while hiring assurance has been provided by FCI, NAFED and NCCF for hundreds of additional locations.
Major reforms have also been undertaken in the cooperative banking sector. Urban and rural cooperative banks have been allowed to open new branches through automatic routes, provide doorstep banking, expand housing and gold loan limits, and benefit from relaxed priority sector norms. Cooperative banks have been included under RBI’s Integrated Ombudsman Scheme, CGTMSE credit guarantee coverage, Aadhaar-enabled payment systems and one-time settlement mechanisms.
Significant tax relief measures have been extended to cooperatives, including reduction in surcharge from 12% to 7%, lowering of MAT to 15%, higher cash transaction limits, relief on TDS and concessional 15% tax for new manufacturing cooperatives. Long-pending income-tax disputes of cooperative sugar mills have been resolved, providing relief exceeding Rs 46,000 crore, while a Rs 10,000 crore loan scheme has been launched to strengthen sugar cooperatives and ethanol production.
At the national level, three new apex multi-state cooperative societies, for seeds, organics and exports, have been established. These societies have collectively enrolled over 58,000 cooperatives, launched national brands such as Bharat Beej and Bharat Organics, and exported agricultural commodities worth Rs 5,577 crore to 29 countries.
Institutional capacity building has been strengthened through the establishment of Tribhuvan Sahkari University, new MBA and PGDM programmes, nationwide training of PACS personnel, and inclusion of cooperative studies in school curricula. Governance reforms under the amended Multi-State Cooperative Societies Act, creation of a Cooperative Ombudsman and Election Authority, and launch of a National Cooperative Database further reinforce accountability.
Shah said these reforms are repositioning cooperatives as a key pillar of inclusive growth, rural prosperity and economic self-reliance during India’s Amrit Kaal.
