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DEFINITION OF CO-OPERATIVE MOVEMENT: -Co - operative movement can be define as a ´Voluntary movement of the people, carried out democratically by pooling together their resources or carrying on the given activity, with the purpose of achieving or securing certain benefits or advantage which given to people can not get individually and with the purpose of promoting certain virtue and values such as self help, mutual help, self reliance and general goods of all.µ Co-operation occupies an important place in the Indian economy. Perhaps no other country in the world is the co-operative movement as large and as diverse as it is India. There is almost no sector left untouched by the co-operative movement. The successive Five-year plans looked upon the co-operation movement as the balancing sector between public sector and the private sector. And the success is evident. Almost 50 percent of the total sugar production in India is contributed by sugar co-operatives and over 60 percent of the total fertilizer distribution in the country is handled by the cooperatives. The consumer co-operatives are slowly becoming the backbone of the public distribution system and the marketing co-operatives are handling agricultural produce with an outstanding growth rate. The National Co-operative Development Corporation (NCDC), a statutory body was set up in 1963 by the Union ministry of Civil Supplies and Co-operation, to promote the co-operative movement in India. Further there is the Indian Farmers Fertilizer Co-operative LTD (IFFCO), which has been successful in setting up an effective marketing network in most of the states for selling modern farming technology instead of fertilizers alone. The operations of IFFCO are handled through its more than 30,000 member co-operatives. The National Agricultural Co-operative Marketing Federation (NAFED) has over 5000 marketing societies. These societies operate at the local wholesale market level and handle agricultural produce. Thus the farmers have a market for their produce right at their door-step. A market which assures them reasonable returns and guaranteed payments. In India we find that the states of Maharashtra and Gujarat are well developed. Whereas the states of Andhra Pradesh, Rajasthan and Karnataka have shown remarkable progress in the co-operative movement and there is a vast potential for the development of co- operative in the remaining states. Co-operatives today are committed to securing an improvement in the quality of life of a vast majority of Indian people. HISTORICAL PROFILE OF COOPERATIVE MOVEMENT IN INDIA Around the world modern cooperatives have developed for over 200 years. Cooperative institutions exist all over the world providing essential services which would otherwise be unattainable. In many Third World countries, cooperatives such as credit unions and agricultural organizations have been very successful in helping people to provide for themselves where private and other corporate capitals do not see high profitability . In 90 countries of the world, over 700 million individuals are members of Co-operative institutions. Globally, cooperatives have been able to elevate its position as a powerful economic model. In some countries they are a sizeable force within the national economy. During the British rule, Nicholson a British Officer in India suggested to introduce Raiffersen model of German agricultural credit Cooperatives in India. As a follow-up of that recommendation, the first Cooperative Society Act of 1904 was enacted to enable formation of "agricultural credit cooperatives" in villages in India under Government sponsorship. With the enactment of 1904 Act, Cooperatives were to get a direct legal identity as every agricultural Cooperative was to be registered under that Act only. The 1904 Cooperative Societies Act was repealed by 1912 Cooperative Societies Act which provided formation of Cooperative societies other than credit. Under 1919 Administrative Reforms act, Cooperatives was made a provincial subject making each province responsible for Cooperative development. The impulses of the Indian freedom movement gave birth to many
Classification of rural and urban societies. govt. Interest of members in society. 7. 4. 5. Loans to members. as it was not sufficient to cop up with the needs of societies. Free audit of accounts by the registrars. the Central Government enacted a comprehensive Act known as Multi State Cooperative Societies Act. repealing the Act of 1942. Utilization of profit. . 6. 8. 2] Period of Harried Expansion: (1912 to 1918): ± As the government doubtful about the act passed in 1904. The objectives are as under: 1. passed another act in 1912 to curtail the deficiencies in the act of 1904. 1984. 3. 6. Legal existence. Responsibilities of members. Restrictions in using co-operative in name. Special rights to societies. Control of Registrar. Classification of societies as per their responsibilities. Concessions to co-operative societies. 3. 2. 4. The act can be studied as under:1] Beginning Period of Co-operative Movement in India (19041912) ± The Indian co-operative movement started on 25 March 1904 with the passing of an act. The main features of the act were as follows: 1. Limits on the distribution of dividend. DEVELOPMENT OF INDIAN CO. 2.initiatives and institutions in the post independence era in India and armed with an experience of 42 years in the working of Multi Unit Cooperative Societies and the Multi-Unit Cooperative Societies Act. This stage has been termed as the primary stage in the development of co-operative societies because the promoters had no idea of cooperation and had very less experience about it.OPERATIVE MOVEMENT: In 1904 the co-operative act was passes as a part of co-operative movement in india. Establishment of co-operative societies. 9. Permission to start non credit supplying societies. 5. 1942.
In 1932. of societies providing credit. 3] Unplanned Rapid Development: (1919-1929):± The matter of cooperation was entrusted to the provincial govt. 5] Period of Recovery (1939-1947): During this period the financial depression of Indian co-operative movement had been removed and this movement was again on the path of its development. The co-operative movement flourished thereafter in many provinces. Shares of society. The atmosphere of world war proved to be beneficial for the co-operative movement.operative movement was defined as ´Unplanned Development. At the outset govt. Therefore this co. In 1937 this section studied various problems of Indian co-operative movement and submitted its report stating that development of co-operative societies should be given priority. Permission was granted to start co-operative societies in other fields. due to passing of reforms act in 1919. The existing societies have to face various problems. Haryana. to develop the co-operative movements in their provinces. Bihar. Orissa and Bengal respectively. The co-operative credit societies had invested their capital in agricultural activities. During this period about 50% of cooperative societies went into liquidation. 1935 and 1941 the acts were past by the govt. The price of agricultural produce went down thus the arrears increase and the existence of co-operative societies was in danger. No proper attention was given to qualitative growth. Depending upon the situation of the province various acts were passed by the respective provincial govt. of Madras. Bihar and Bengal. The ratio of loans to arrears was 20% in 1927-28 which increased to 40% in 193232.µ 4] Period of Consolidation and Re-organization (1929. During 1919.1929 only quantitative growth of societies would be seen. 8. . The percentage of arrears went up to 93% in Bombay in 1938-39. appointed committees to study the co-operative movement.1939): ± There was vigorous blow to the Indian co-operative movement because of the worldwide financial depression in 1929 and so the development of co-operative movement stopped. Provincial govt. Permission to establish central societies. Co-operative Movement was shooted for expansion. The shortcomings of 1904 act were overcome by 1912 act. Due to the passing of co-operative act in 1919the co-operative movement boosted up and there was a tremendous development in the no. of Bombay first passed the act in 1925.7. It affected the co-operative movement in Punjab. A separate section for providing agricultural credit was opened. In 1935 Reserve Bank of India was established. The price of the agricultural produce started increasing thereby there was an increase in the income of the agriculturists and their repayment capacity went to a higher level.
6] The Sixth Stage (1947-1970): After attaining independence the government felt that co-operatives should play an important role in the development of rural areas.07 106. Cooperatives were asked to develop rural banks. TYPES OF CO-OPERATIVES . 8] The Eighth Stage (2000 onwards): The rise of the new millennium has thrown many challenges to the co. 7] The Seventh Stage (1970.01 121. of societies (in 000¶s) Membership (in lakhs) Capital (in crores) 1939 122.00 69. The WTO restrictions and the threat from global co-operation have grown. Non-profit supplying societies and multipurpose societies had developed.The consumer co-operative stores prospered due to the restriction imposed during war time. The government is providing adequate support and help to the co-operatives by building brands.00 90.00 156.47 1943 146. its membership and capital.2000): During this period the government laid more importance on the development of rural banking sectors. The formation of NABARD as an apex bank was formed for monitoring the co-operative bank. During 1939-1946 the field of co-operative movement was spread over a large scale. The development of co-operative movement during 1929 to 1947 can be seen from the following table: Year No. The co-operatives have to face direct competition from multinationals.00 Due to the bifurcation in 1947 some of the co-operative societies had been shifted to Pakistan thereby reducing the number of societies.00 1947 139. Co-operatives were included in 5 year plans.6 104. The late prime ministers Jawaharlal Nehru and Lal bahadur shastri stressed on the importance co-operatives.14 1946 172 91.operatives. distribution network and also in exporting their products to global market. The industrial co-operative societies came into existence for the purpose of providing war materials.00 53.operative across the country. The government also took the initiative in replicating the Anand pattern Model for dairy co.
e. the Punjab State co-operative Supply and Marketing Federation is playing an important role in building up an integrated structure for remunerative marketing and storing of agricultural produce. construction and farming. enable - . The major objectives of the primary agricultural credit service societies are to supply agricultural credit to meet the requirements of funds for agricultural production. but each farmer retains the right of property. i. the Co-operative Movement began to spread to other field. (2) Agricultural Non-Credit Societies . (3) Agricultural co-operative Marketing Societies Marketing has occupied a far smaller place in the co-operative picture in India than in many countries. ithas played an important role in the Green Revolution in the State by arranging ready supplies of essential farm inputs needed by the cultivators.The Co-operative Movement was introduced into India by the Government as the only method by which the farmers could overcome their burden of debt and keep them away from the clutches of the money-lenders.35 lakhs and the deposits to Rs. Under this system. (1)The Primary Agricultural Credit/Service Societies± The agricultural co-operative credit structure in the Punjab State is broadly divided into two sectors. The Co-operative Credit Societies Act.761. Originally.180. The first Agricultural Credit Society in the Firozpur District was registered on 4 October 1911. The number of societies also rose. 2. Another interesting development in co-operative during the War was the extension of the Movement to non-credit activities. the provision of storage and marketing facilities and for light agricultural implements and machinery. at the Village of Khalchi Kadim in the Firozpur Tehsil. The loan advanced during the same year amounting to Rs. They are allowed to withdraw from the cooperative farm whenever they desire. 1904 was passed by the Government of India and rural credit societies were formed. Prices of agricultural goods began to rise and touched new peaks. credit dominated till the partition (1947). 26. At the State level. the short-term and medium-term credit structure is based on a three-tier system. namely consumer·s co-operative marketing societies. the exceedingly small size of holdings is perhaps the most serious defect in our agriculture. one dealing with the short-terms and medium-terms finance and the other with the long-term credit. The full utilization of loans advanced depends upon the arrangements for the marketing of surplus produce. The World War II came as a God send boon with respect to the development of the Cooperative Movement. (4) Co-operative Farming Societies . The cooperative farming societies. In the State.The Royal Commission on Agriculture in 1928 observed that it co-operation failed. If agriculture has to be improved. 21.When the non-credit societies were brought officially under the protection of the Movement. the movement was confined to the credit societies only and. all landowners in a village form a co-operative society for cultivate the land. These societies also provide other agricultural Facilities and make arrangements for the supply of domestic items in the rural areas. the distribution of essential consumer commodities. The repayment of loans was accelerated and deposits began to increasing. integration of societies. the number of agricultural cooperative credit societies in the District was 309 with a membership of 1. the Apex Co-operative Bank at the State level.84 lakhs. the Central Co-operative Bank at the district/tehsile level and the Primary Agricultural Credit Societies at the village level. viz labour. etc. The land is combined. After the partition. the size of the holdings must be enlarged. thus. there would fail the hope of the Indian agriculturist. In India. thus. In 1979-80.
has adopted an attitude of patronizing the movement. Right from the beginning the govt. Two. Government Interference:The cooperative movement in India was initiated in 1904 under the auspices of British government. Over the years. nor can they analyze and solve problems from different angles. the most of the societies have been single purpose societies. .the cultivators to enjoy the economies of large-scale farming through the pooling of land management resources. efficient personnel did not feel attracted or motivated towards them. It is therefore necessary to know the causes of poor Performance of the movement and on that basis take such steps as would promote a faster growth of cooperative movement in India. Under the Maharashtra State Co-operatives Act. Restricted Coverage:The cooperative movement has also suffered on account of two important limitations on It working. The strength of the movement was the involvement of the farmers who were shareholders in the sugar mill regardless of the size of their holdings. For this reason these societies are unable to take a total view of the persons seeking help. Unfortunately. One is that the size of these societies has been very small. B. no special efforts have been made in this direction. Under these circumstances it has not been possible for these societies to make much progress. there has been a lack of institutions fort this purpose of training personnel. Lack of Awareness:People are not well informed about the objectives of the movement. People look upon these institutions as means for obtaining facilities and concessions from the govt. D. A. the contributions it can make in rebuilding the society and the rules and regulations of cooperative institutions. a minimum of 11 farmers is required to form a Co-operative. As a result people·s enthusiasm for the movement did not grow. In the first place. Cooperative institutions were treated as if these were part and parcel of the administrative set up of the government. The relationship between the shareholder farmer and the cooperative is simple . Mismanagement and manipulation:The essence of the cooperative movement is that it gives the farmers the status of shareholder and assures them agricultural. Secondly because of it unsatisfactory working of cooperative institutions.000 farmers.000 and 25. this truly democratic idea got corrupted and farmers with larger holdings grew more powerful C. Functional Weakness:The cooperative movement has suffered from inadequacy of trained personnel right from its inception. Lack of trained personnel has been caused by two major factors. educational and medical facilities. CAUSES OF SLOW PROGRESS Despite rapid growth the overall progress of cooperative movement during 100 years of Its existence is not very impressive. Today the shareholder membership averages between 15.the farmer is committed to contributing a certain amount of cane per season and the mill is bound to take this cane. The govt. interference thus became an essential elements in the working of these institutions. E.
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