What role do co-operatives plays in poverty alleviation in rural India ? (UPSC CSE Mains 2022 - Sociology, Paper 2)
- A cooperative is an association of persons united voluntarily to meet their common economic, social and cultural needs and aspirations through a jointly owned and democratically controlled enterprise. It means that cooperatives are based on the values of self-help, self– responsibility, democracy, equality, equity and solidarity in the tradition of their founders. Cooperative members believe in the ethical values of honesty, openness, social responsibility and caring for others. Therefore, the cooperatives are different from the private enterprise in their forms of ownership, control, distribution of profits, values of equality, equity, solidarity and social responsibility. Mahatma Gandhi’s philosophy of Sarvodaya aimed at rural reconstruction and uplifting the people of rural India by peaceful and cooperative means.
- The size and volume of cooperative business during the post-independence period has shown rapid growth and multiplied manifold. The coverage of villages by cooperatives, which was 30% in 1950-51, has reached cent percent and by 2001-2002, 75% of the rural households were brought into the cooperative fold. Cooperatives have entered into every sphere of economic activity and emerged as one of the significant segments of Indian economy.
- Their contributions in shaping the rural economy are substantial. The share of cooperatives in rural credit disbursement amounted to 49.3% during the year 2001-2002, fertilizer distribution was 36.0%, fertiliser production 29.0%, sugar production 59.0%, branded oil marketing 50%, ice cream production 45%, animal feed production 50%, spindling 12%, fabrics production 22.0%, handloom cooperatives 55%, wheat procurement 36.0%, jute procurement 21%, fishermen’s cooperatives 11%, rural fair price cooperatives 28%, salt manufacture 7% and employment was created for 15.1 million people. The contribution of milk cooperatives in milk production, procurement and distribution is significant.
- Cooperatives were also organized at grass roots level for fisheries, forest labour, farm forestry, poultry, weavers, handlooms, handicrafts, and irrigation to organize the rural people and provide them necessary services for the development of rural community. The education and training networks of cooperatives have promoted awareness regarding development, advantages and techniques of living under the umbrella of cooperatives. This has helped in curbing the migration of the rural people from rural to urban areas.
- The cooperative venture and its programmes have also promoted diversification in crop production; effective use of chemical fertilizers, insecticides and better seeds; new techniques for improving the fertility of the land and various ancillary activities. The setting up of marketing and processing cooperatives has not only helped the farmers in ensuring better prices for their produce but have also generated significant rural employment.
- A cooperative as a legal entity, has institutional networks and infrastructure facilities at the grass roots level. It is also involved in social welfare and social protection activities of the rural people, such as village adoption, insurance, promotion of schools, hospitals, development of social forestry, etc. It has also generated rural employment for large sections of rural people through its agro-ancillary activities.
- With the present size and network of the cooperatives, their contribution should have been much more than what it is today. The major problems that have limited the size of their contribution are, to name the important ones, the increasing amount of nonperforming assets (NPA), limited resources, lack of infra-structural facilities and professionalism, absence of modernization and little technology transfer, over dependence on governments, absence of effective monitoring and poor market information systems.
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