PIB Summary - 5th July 2025 | PIB (Press Information Bureau) Summary - UPSC PDF Download

Cooperatives: Building a Better Tomorrow

 Context and Significance 

• The UN has declared 2025 as the International Year of Cooperatives.
• The theme for the International Day of Cooperatives in 2025, celebrated on July 5th, is “Cooperatives Build a Better World ”.
• This theme highlights the role of cooperatives as people-centric enterprises that tackle global challenges and contribute to the United Nations Sustainable Development Goals (UN SDGs).
• There are over 3 million cooperatives worldwide, employing approximately 280 million people, which is about 10% of the global workforce.

India’s Cooperative Landscape

• India has 8.42 lakh cooperative societies operating in various sectors, including agriculture, dairy, fisheries, credit, housing, and women’s welfare.
• The country has a rich history of informal cooperatives dating back to the pre-colonial era, such as Phads, Bhishies, and Chit Funds.
• Some of the iconic cooperatives in India include Amul, IFFCO, KRIBHCO, NAFED, and NCDC.

Key National Highlight

• Foundation Stone for Tribhuvan Sahkari University (TSU). Union Home Minister Amit Shah is set to lay the foundation stone for the Tribhuvan Sahkari University (TSU) in Anand, Gujarat.
• Significance of TSU. This will be India’s first national-level cooperative university, named after Tribhuvandas Patel, a key figure in India’s cooperative movement.

Major Government Initiatives

PACS Reform & Digitalization

• Computerization of PACS: 67,930 Primary Agricultural Credit Societies (PACS) have been approved for computerization, with an allocation of ₹918.69 crore from States and NABARD.
• ERP Onboarding: 54,150 PACS have been onboarded onto the Enterprise Resource Planning (ERP) system, with 43,658 currently operational.
• Model Bye-Laws: Adopted by 32 States and Union Territories.
• New Multipurpose Societies: 18,183 new multipurpose societies, including Dairy, Fisheries, and PACS, have been registered up to March 2025.

White Revolution 2.0

• Launched in December 2024, aiming for a 50% increase in milk procurement over five years.
• Dairy Cooperative Societies: 9,695 new societies registered across 27 States and Union Territories.

Banking Empowerment

• RuPay Kisan Credit Cards (KCC): 32.1 lakh KCCs issued under the cooperative umbrella.
• Micro-ATMs: 6,446 micro-ATMs distributed; 9,200 dairy PACS designated as Bank Mitras.
• Urban Cooperative Banks (UCBs): Allowed branch expansion and doorstep banking services.
• National Urban Cooperative Finance and Development Corporation (NUCFDC): Approved by the Reserve Bank of India for UCBs.
• NABARD Support: Financial support for Self-Help Groups (SSE) under NABARD for rural cooperatives.

Farmer Producer Organizations (FPOs) & Organics

• Formation of FPOs: 1,867 FPOs and 70 Fishery FPOs (FFPOs) established under the cooperative model.
• National Cooperative Organic Label (NCOL): 5,185 PACS members; 21 organic products launched under “Bharat Organics”.

Fuel & Ethanol Push

• PACS Petrol Pumps: 188 PACS petrol pumps approved, with 59 currently operational.
• Sugar Mills Scheme: ₹10,000 crore scheme for sugar mills; 63 ethanol plants transitioning to multi-feed production (from sugarcane to maize).

Financial & Tax Reforms

• Minimum Alternate Tax (MAT): Reduced to 15% from 18.5% for cooperative societies.
• Income Tax Surcharge: Cut from 12% to 7% for income range of ₹1–10 crore.
• TDS Withdrawal Limit: Raised to ₹3 crore per year.
• Cash Deposit/Loan Limit: Per member limit raised to ₹2 lakh.
• Tax Relief to Sugar Mills: ₹46,524 crore tax relief; GST on molasses reduced from 28% to 5%.

Global & National Milestones

• National Cooperative Database (NCD): 8.42 lakh societies mapped.
• National Cooperation Policy 2025: Policy ready, aligning with Viksit Bharat 2047 vision.
• ICA Global Cooperative Conference 2024: Held in Delhi with over 3,000 participants from the cooperative sector.

NCDC Performance

• FY 2023–24: ₹60,618.47 crore disbursed, marking a 48% growth.
• FY 2024–25: Estimated ₹95,000 crore disbursed, approximately 58% growth.
• Future Target: ₹1 lakh crore loan disbursal within three years.
• Bond Issuance: ₹2,000 crore bond issuance approved to aid sector development.

Comparative Global Insights

• Japan: Strong agricultural cooperatives integrating production, marketing, and insurance services.
• Kenya: Savings and Credit Cooperative Societies (SACCOs) are crucial for credit access among low-income groups.
• France: Worker cooperatives play a central role in the structure of small and medium-sized enterprises (SMEs).
• India: Holds the world’s largest number of cooperatives, yet faces challenges related to governance and productivity.
• Comparative Metric: Although India has more cooperatives, its per-unit impact efficiency is lower than that of some OECD countries.

Challenges in India’s Cooperative Sector

• Political Interference: There is significant political interference in the elections and management of cooperatives, which affects their autonomy and effectiveness.
• Financial Literacy and Technology: Many grassroots cooperative members lack financial literacy and technological capacity, hindering the growth and efficiency of these organizations.
• Auditing and Transparency: Weak auditing practices and lack of transparency in many PACS (Primary Agricultural Credit Societies) raise concerns about their governance and financial health.
• Regional Disparities: There is uneven growth in the cooperative sector across different regions of India, with states like Maharashtra and Gujarat leading, while northeastern and eastern states lag behind.
• Gender Representation: Women are underrepresented in leadership positions within cooperatives, which limits the diversity and inclusiveness of these organizations.

Success Stories & Case Studies

• Amul:. global leader in dairy, Amul’s success is rooted in village-level cooperatives, particularly those led by women, who play a crucial role in milk production and processing.
• SEWA (Self-Employed Women’s Association): Based in Gujarat, SEWA empowers women by organizing cooperatives in various sectors, including health care, banking, and garment production, providing them with sustainable livelihoods and financial independence.
• Matsyafed (Kerala): Fishermen cooperatives under Matsyafed are transforming coastal livelihoods by ensuring fair prices for fish, providing better working conditions, and promoting sustainable fishing practices, thereby improving the economic status of fishermen communities.
• Sikkim Organic Co-ops: Cooperatives in Sikkim are managing certified organic produce, which is highly valued in global markets. These co-ops ensure high standards of organic farming and processing, allowing farmers to fetch premium prices for their products in export markets.

Youth & Start-up Linkages

• Rural Incubators: Cooperatives have the potential to act as incubators for startups in sectors like agri-tech, fishery-tech, and fintech, fostering innovation and entrepreneurship in rural areas.
• Youth-led Cooperatives: There is a growing scope for cooperatives led by youth focusing on climate technology, digital skilling, and other emerging sectors, promoting sustainable practices and skills development.
• Training Future Leaders: Tribhuvan Sahkari University (TSU) can play a vital role in training the next generation of cooperative leaders, equipping them with the necessary skills and knowledge to drive the cooperative movement forward.
• Scalable Business Models: The combination of cooperatives and startups can lead to the development of scalable and inclusive business models, particularly in Tier 2 and Tier 3 cities, addressing local needs and creating job opportunities.

Climate & Sustainability Angle

• Water Conservation: Community-led water conservation initiatives in drought-prone areas can be facilitated through cooperatives, helping local communities manage and preserve their water resources effectively.
• Agroforestry: Cooperatives focused on agroforestry can earn carbon credits by engaging in reforestation and sustainable land management practices, contributing to climate mitigation efforts.
• Dairy Sustainability: Dairy cooperatives promoting feeding practices that reduce methane emissions contribute to climate goals by minimizing greenhouse gas emissions associated with dairy farming.
• Renewable Energy: Cooperatives involved in decentralized solar power and other renewable energy projects contribute to sustainable energy production and consumption, aligning with climate action objectives.

Digital & Tech Innovations

• ERP Software: The use of Enterprise Resource Planning (ERP) software for the digitization of PACS (Primary Agricultural Credit Societies) is enhancing operational efficiency and management.
• Blockchain Technology: Implementing blockchain for traceability in milk and grain supply chains is improving transparency and trust in these sectors.
• AI Forecasting: Agricultural cooperatives are leveraging AI-powered forecasting tools for predicting price trends and pest control, aiding farmers in making informed decisions.
• Cooperative CRMs: Development of customer relationship management (CRM) systems and e-commerce portals for cooperatives to sell products directly to consumers, enhancing market access and profitability.

Policy Asks / Needed Reforms

•  Establish a National Cooperative Tribunal to ensure quick and efficient resolution of disputes within the cooperative sector. 
•  Grant more autonomy to cooperative banking under the regulatory framework of the Reserve Bank of India (RBI) and NABARD to enhance their operational flexibility. 
•  Develop a credit rating system for cooperatives to facilitate their access to institutional finance, improving their financial health and sustainability. 
•  Create a dedicated startup fund for cooperative innovation to support and nurture innovative ideas and practices within the cooperative sector.