Syllabus:

GS2: Important aspects of governance, transparency and accountability

Context: 

Recently, the United Nations General Assembly proclaimed 2025 as the International Year of Cooperatives (IYC2025), underscoring the vital role cooperatives play in sustainable development.

More on the News

• This year’s theme “Cooperatives Build a Better World” underscores the enduring global impact of cooperatives, positioning them as essential solutions to today’s global challenges.
• It highlights their contributions to sustainable development across social, economic and environmental dimensions, showing how cooperatives are key drivers in achieving the UN Sustainable Development Goals (SDGs) by 2030. 
• The theme also emphasizes the unique ability of cooperatives to foster inclusive growth and strengthen community resilience. 

India’s Position in Global Cooperative

Number of Cooperatives in Top 300 (by Turnover/GDP per capita):

• 15 cooperatives from India are listed.
• IFFCO holds the top position among Indian cooperatives, followed by Amul.

India’s Ranking: 

• 2nd in the Asia-Pacific region, after Japan.
• 6th globally, after the USA, France, Germany, Brazil and Japan.

Ranking by Turnover (in USD):

• IFFCO – Ranked 72nd
• Amul – Ranked 90th
• KRIBHCO – Ranked 236th

• India accounts for nearly 27% of all cooperatives in the world. Over 20% of Indian population is estimated to be part of the cooperative.

• To commemorate the International Year of Cooperatives (IYC) 2025, the Ministry of Cooperation prepared a comprehensive Annual Action Plan and launched in Mumbai, Maharashtra.

• For effective planning and implementation, the Ministry established:

• IYC-National Cooperative Committee
• IYC-National Execution Committee
• IYC-State Apex Committees

Key Initiatives under IYC 2025:

• “Ek Ped Maa Ke Naam” Plantation Drive: A nationwide tree plantation campaign encouraging individuals to plant a tree in their mother's name, promoting both environmental consciousness and emotional connect.
• National Conference of State Cooperation to discuss cooperative reforms, best practices and policy frameworks across states.
• Foundation Stone of India's First Cooperative University, “Tribhuvan Sahkari University” at Anand, Gujarat.
• “Swachhta me Sahkar” Cleanliness drives includes nationwide sanitation and cleanliness campaigns emphasizing the role of cooperatives in achieving Swachh Bharat goals.

Cooperatives

• Cooperatives are people-centred enterprises owned, controlled and run by and for their members to realise their common economic, social and cultural needs and aspirations.
• Cooperatives allow people to take control of their economic future and, because they are not owned by shareholders, the economic and social benefits of their activity stay in the communities where they are established. 
• Profits generated are either reinvested in the enterprise or returned to the members.

Cooperatives in India

Cooperative movement in the Pre-Independence Era:  

• Cooperatives gained legal status in India in 1904 through the Cooperative Credit Societies Act, which set guidelines for their formation, membership, registration, liabilities, profit use, rules and dissolution. 
• The Cooperative Societies Act of 1912 addressed the shortcomings of the 1904 Act, expanding the scope to include marketing societies, handloom weavers, and other artisan societies.
• The Government of India Act of 1919 empowered provinces to enact laws for cooperatives, leading to the passage of the Bombay Cooperative Society Act of 1925, the first cooperative legislation by a provincial government.
• In 1942, the Government of India enacted the Multi-Unit Cooperative Societies Act to regulate cooperatives with membership from multiple provinces and delegated the power of the Central Registrar of Cooperatives to State Registrars for practical purposes. 

Cooperative movement in the Post Independence Era:

• The establishment of the National Cooperative Development Corporation (NCDC) in 1963 and the National Bank for Agriculture and Rural Development (NABARD) in 1982 were key milestones in supporting rural credit and cooperative development.
• In 1984, the Indian Parliament passed the Multi-State Cooperative Organisations Act to streamline laws governing cooperatives across states. Further consolidation occurred with the introduction of the National Policy on Cooperatives in 2002, aiming to harmonize the legal framework.
• The Multi-State Cooperative Societies (MSCS) Amendment Act 2023 and associated rules seek to enhance governance, increase transparency, and implement structural changes within Multi-State Cooperative Societies (MSCS), empowering cooperatives with greater independence.
• When cooperative societies engage in banking activities, they fall under the regulatory purview of the Reserve Bank of India (RBI) and are required to obtain a license under the Banking Regulation Act, 1949.

Constitutional Provisions related to the Co-operative Societies

The 97th Constitution Amendment Act, 2011 granted constitutional status to the Cooperative Societies and made the following provisions, namely: 

• Right to form cooperative societies was included as a Fundamental Right by insertion of the words “cooperative societies” in Article 19(1)(c) in Part III of the Constitution. 
• Article 43B was inserted in Part IV of the Constitution as Directive Principle of State Policy for promotion of cooperative societies. 
• Entry 32 of the State List of Seventh Schedule 
• Part IX B ‘The Cooperative Societies’ was inserted with provisions for incorporation, regulation and winding up of co-operative societies. 

Source: PIB

https://www.pib.gov.in/PressReleasePage.aspx?PRID=2147173 https://sansad.in/getFile/annex/258/AU1604.pdf?source=pqars https://www.pib.gov.in/PressReleasePage.aspx?PRID=2073319