Co-Operatives in India: History, Problems & Reforms

Co-operatives were first introduced in India under the Co-operative Credit Societies Act, 1904. As in many other countries, co-operatives started as a means of ensuring for the poorly-equipped citizens advantages which better placed persons were able to command by their own individual resources. After Independence in 1947, co-operatives, as instruments of economic development of the disadvantaged, particularly in the rural areas, received considerable emphasis during the successive Five Year Plans. The founders of planning in the country saw a village panchayat, a village co-operative and a village school, as the trinity of institutions on which a self-reliant and a just economic and social order was to be built. The non-exploitative character of co-operatives, voluntary nature of their membership, principle of one-man, one-vote, decentralised decision-making and self-imposed curbs on profits eminently qualified them as instruments of development combining the advantages of private ownership with public good. Over the years, co-operative societies, apart from expansion in numbers and size, have assumed growing diversity of functions. Besides agricultural societies of all types (viz. credit, processing, marketing, farming, irrigation, consolidation), there are industrial co-operatives, labour societies, consumers’ co-operatives in rural as well as in urban areas, housing societies, processing factories and urban banks. This book provides a comprehensive account of the historical evolution of co-operatives in India, their problems, policy measures to strengthen them and their role in the changed scenario in the context of liberalisation, privatisation and globalisation.