seminar on coopeartive in india
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Cooperatives in India:An overview
Speaker:
Deepak SinghMBA-Agribusiness
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I know of no other instrument so
potentially powerful and full of socialpurpose as the co-operative
Smt. Indira Gandhi
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CO-OPERATION
Derived from Latin word
Co - Together
Operari- Working
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It is a sort of association of persons,joined for common purpose which theycan not achieve separately.
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Definition
A co-operative is an autonomous
association of persons united voluntarilyto meet their common economic, social
through a jointly owned anddemocratically controlled enterprise.
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Values
self help,
self responsibility,
democracy, equality and solidarity.
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Principles
Voluntary and open membership.
Democratic member control.
Member economic participation.
Autonomy and independence.
Education, Training and Information.
Co-operation among cooperatives.Concern for community
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The cooperative credit system has the largest
network in the world and cooperatives haveadvanced more credit in the Indian
agricultural sector than commercial banks.
1956- National Cooperative Development &Warehousing Board.
1963-NCDC
1967- VAMNICOM
2002- Multi-State Co-operative Societies
ActDeepak Singh Cooperatives in India 8
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Current status
580,000 cooperatives of all types;
400 million individual members;
375,000 agricultural cooperatives;
280 million farmer-members
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Important Segments of Indian
Cooperatives Cooperative education and training
Agricultural credit cooperatives
Non agricultural credit cooperatives (urban
Cooperative marketing
Tribal cooperatives
Fertilizer cooperatives Consumer cooperatives
Weaver cooperatives
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Contd
Sugar cooperatives
Cooperative spinning mills
Industrial cooperatives (non weavers)
Dairy cooperatives
Fisheries cooperatives
Housing cooperativesLabour cooperatives
Poultry cooperativesDeepak Singh Cooperatives in India 11
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Market Share In fertilizer production and distribution the
Indian Farmers Fertilizer Cooperative (IFFCO)commands over 35 percent of the market.
In h r i n f r h r iv
share of the market is over 58 percent and inthe marketing and distribution of cotton they
have a share of around 60 percent.
The cooperative sector accounts for 55percent of the looms in the hand-weaving
sector.
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Cooperatives process, market and distribute
50 percent of edible oils. Dairy cooperatives (70% milk share)operating
n r h l r hi f h N i n l D ir
Development Board and through 15 statecooperative milk marketing federations has
now become the largest producer of milk in
the world.
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Dairy CooperativesFirst Milk Producers Cooperative Union: Kaira- Gujarat- 1946 Number of Dairy Cooperatives : 121,180 Membership Total (in Million) : 12.95 Women Membership (in Million) : 2.96
(Millions US$) Share Capital : 83
Working Capital : 465 Assets : 413 Turnover (Total) 2004-05 : 1206
Total Milk Procured by Coops (Mill It.) : 7325
Liquid Milk Marketed per day (Mill It.) : 15 Balanced Cattle feed Production : 1.09 million tns
Data Source: NCUI: Indian Co-operative Movement A Profile 2006.
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Sugar CooperativeFirst Cooperative Sugar Factory: Parwara Maharashtra 1948
Number of Cooperative sugar mills : 316 Membership Total (in Million) : 5.14 Growers Membership : 92.5 %
(Millions US$) Share Capital : 716 Turnover (Total) 2004-05 : 285 Total cane crushed (Mill tns.) : 44
Total Sugar Produced (Mill tns.) : 7.8
Data Source: NCUI: Indian Co-operative Movement A Profile 2006.
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National Cooperative Union of
India (NCUI)
Apex body in India which represent all
the segments of Indian CooperativeMovement.
was es a s e n as n aCooperative Institutes Association.
Was rechristened as National
Cooperative Union of India (NCUI) in1961.
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Functions of NCUI Promotion and Strengthening of Cooperative
Movement Cooperative Education and Training
Development of Inter-Cooperative Relations
Collection and Dissemination of Co-operativeinformation
Promotion of International Co-operation and Co-
operative Trade
Voicing of Co-operative Opinion and views
Provides 100% grant in aid for Intensification of co-
operative education in co-operatively under developed
states.Deepak Singh Cooperatives in India 18
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Cooperative Credit
Organization
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State Cooperative Bank(SCB)Members : DCCB & PACS
Link between RBI & PACS
Help State Govt. in formulating
Development plans regard to co-op.Bankers to DCCB, supervise, control &
guide
Normal banking operations
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District Central Cooperative
Bank(DCCB)Members : individuals & societies
Guide, Supervise & inspect PACS
Non credit activities : supply of seeds,
fertilizers & other consumer goods.Provide requisite funds to the societies
Accept deposit both from public &societies.
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Primary Agricultural
Cooperative Societies(PACS)Minimum number required is 11;
Members buy shares;
PACS raise money from district banks
for lending to members for purchaseof farm inputs fertilizer, seeds, farmchemicals, farm implements, land
improvement, agro-processing,warehousing etc.
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Farmer Service Society (FSS)FSS introduced in the country in 1973
on recommendation of Nationalcommission on agriculture (NCA).
commerc a an or cen racooperative bank can launch a FSS.
A FSS initially covers around 8 to 10
villages and then subsequently thewhole block.
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32 State Cooperative Banks;
850 District/Sub-district Banks; with12600Branches;
.
Worlds largest agri credit system;
Central financing through NABARD;
8% lending rate [2% subsidy by Govt]; PACS major users for agri production;
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Credit status7 SCBs & 143 DCCBs do not comply
with minimum share capital requirement
More half of the PACS & more than 500
s are ncurr ng osses
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Reasons for failure os
Cooperative Credit Societies Increasing no. of commercial banks in
rural areas
Fraud & Corruption
Financial CrisesMore political intervention
Lack of Training
Lack of technology
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National Agricultural Cooperative
Marketing Federation(NAFED)
Estd 2nd October 1958
To facilitate, coordinate and promote themarketing and trading activities of the
coopera ve ns u ons n agr cu ura another commodities, articles and goods
Total internal trade Rs. 408045.96 lakh
Total International trade Rs. 98458.88 lakh
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National Cooperative Housing
Federation (NCHF)Set up in 1969
4 tier structure housing coop, distt.Federation, State fed, & national.
26 state level federations92,000 housing cooperatives with6.6 m
members
3 million dwelling upto 2008
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Issues Heavy erosion in their democratic and autonomous
functioning.
Most of the grassroots co-operatives are not self-reliant
and heavily dependent on Government Assistance.
Management not responsive to the needs of the members
and not truly accountable to them. Sickness is increasing resulting in large number of defunct
/ dormant societies.
Co-operatives are not well equipped to face the challenges
of open and competitive market oriented economy. As aresult, they are not only loosing ground in their traditional
areas of activities but also unable to enter into new
ventures
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Constraints Elections are not held regularly.
Supersession of Board of Directors and appointment of
Administrators for undue longer period.
General Body meetings are not held regularly.
Audit is not professional. It is also not conducted in time.
There is undue and unnecessary political interference andbureaucratic control even in their day-to-day affairs.
Unprofessional management leading to high operational cost
and delayed delivery of services to members.
Lack of member participation.
Poor system of monitoring and inadequate checks and
balances.
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Problems The products are neither popular among
customers nor profitable to the institutionthemselves.
iff m i i n fr m riv
Poor participation of members
Weak financial base of societies
Absence of professional management
Ever growing corruption and frauds, etc
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Suggestions1. Cooperative Reforms
Simplified procedure for registration
Removal of unwanted govt.
interferences Members of non political background
Defined rules & procedures
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2. Administrative ReformsDebureaucratisation
Professional Management & staff
Skill building/ skill upgradation of staff
Adoption of uniform accountingprocedures.
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3. Business ReformsAfter scanning environment
development plan should be madeThe plans should be quantifiable &
measura e w spec e me ramefor achievement.
Empowered monitoring scheme.
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Some Success Stories
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AMUL Anand Milk
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AMUL-Anand Milk-
producers Union Limited Formed in Dec,1946, & started a dairy
cooperative movement in India under the
leadership of Varghese Kurian.
It is a brand name managed by an apex, -
Milk Marketing Federation Ltd. (GCMMF),started with 2 village having 250 lt/day milkwhich today is jointly owned by some 2.8
million milk producers in Gujarat, with milkcollection average of 10 million litres/day
It is also the world's biggest vegetarian
cheese brand.Deepak Singh Cooperatives in India 36
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AMUL13 : District coop. milk producers' Union
2.8 million : Milk producing members12,792 : Village Societies
10 million liters : Daily(avg) milk collection
60 percent milk : Converted to value added594 Mts. : Daily milk drying capacity
2640 Tns/ day : Cattle feed manufecturing
1.05 Billion US$ : Annual Turnover28 Million US$ : Exports
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Automatic Milk Collection System units
(AMCUS) at village societies wereinstalled in the first phase to automate
.
AMCUS facilitated to capture memberinformation, milk fat contents, volume
collected and amount payable to eachmembers electronically via a plasticcard for identification.
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Now officials at AMUL are planning to
upgrade the plastic card to SMART cards tofacilitate farmers to withdraw money from
ATMs
Initiatives have been taken for online orderplacement for AMULs products as a result of
which AMUL is today exporting products to
West Asia, Africa and U.S.A.
AMUL also planning to double the production
by 2020 to fulfill the future demand.Deepak Singh Cooperatives in India 39
Indian Farmers Fertiliser Co
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Indian Farmers Fertiliser Co-
operative Limited (IFFCO) Indian Farmers Fertiliser Co-operative
Limited (IFFCO) was registered onNovember 3, 1967 as a Multi-unit Co-
.
The number of co-operative societiesassociated with IFFCO have risen from
57 in 1967 to more than 38,155 atpresent, undertaking distribution of itsfertiliser through these co-operative
societies.Deepak Singh Cooperatives in India 40
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Suguna Poultry Suguna's Success of an Extraordinary Vision Incorporated
as a company in 1994
The success of Suguna is a glorious testimony of the power ofhuman visionary zeal, innovation, determination and co-operation.
Poultry Integration is a concept introduced and achieved by
Suguna.
Suguna has been successful in the integration of tens ofthousands of farmers, thereby enhancing their life-styles.
Suguna has steadily and positively grown on its core ideals of
Total Quality Management, constant Innovation, impeccablehygiene and understanding Customer needs.
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Mission 25% Market share in India
20% Annual Income from Exports Switch over consumers from Live Bird to
25% income from Sugunas branded products
Recognizing human values
Social commitment
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ConclusionCooperative have a unique place in
growth of the rural India, this is the onlytool by which the problem of scarcity of
.
is a need to revamp the cooperativesstructure & status to achieve the full
fledged benefits of it.
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"In cooperatives, men and women have intheir hands the tools to fashion their
own est ny.Murray D Lincoln
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