Amit Shah to unveil new National Cooperative Policy: What it means for India’s cooperative sector

The new policy, replacing a 23-year-old framework, aims to reshape India’s cooperative movement for the next two decades.

Union Home Minister Amit Shah will unveil a new National Cooperative Policy on Thursday, replacing the one in place since 2002.

According to the Cooperation Ministry, this updated framework will be a 'milestone for the cooperative movement in India for the next two decades (2025–2045).' The ministry said a revamp was essential due to globalisation and rapid technological changes that have reshaped the sector in the past two decades.

How the Cooperation Ministry came to be

The Ministry of Cooperation was carved out as a separate ministry by the Modi government in July 2021, with Amit Shah taking charge.

Earlier, cooperatives functioned as a department within the Agriculture Ministry since 1979. With the new ministry, Sahkarita Mantralaya, the Modi government pushed the vision of 'Sahakar se Samriddhi' (Prosperity through Cooperation).

From a small office at Krishi Bhawan, the ministry has expanded to a new base at Atal Akshaya Urja Bhawan on Lodhi Road, with additional wings at the World Trade Centre complex.

Shah’s vision: A bigger, modern cooperative network

On July 6, while marking four years of the ministry, Shah said Prime Minister Modi had 'breathed new life' into more than 8.4 lakh cooperative societies, impacting over 31 crore people.

Under Shah, the ministry has launched several big initiatives:

• Multi-State Cooperative Societies Act, 2023: Enabled the formation of three new national-level cooperative bodies, including National Cooperative Exports Limited (NCEL).
• Grain Storage Scheme: Plans for the world’s largest grain storage programme under cooperatives.
• Two lakh new Primary Agricultural Credit Societies (PACS): Diversifying activities across 25 sectors such as dairy, fisheries, fuel distribution, procurement, and Common Service Centres.
• First National Cooperative University: Foundation stone laid this month, with a push to include cooperative education in school curricula. Why cooperatives matter

• 20 percent of India’s agricultural credit comes from cooperatives.
• 35 percent of fertiliser distribution and 25 percent of fertiliser production are managed by them.
• 31 percent of sugar production, over 10 percent of milk production, and over 20 percent of paddy procurement are handled by cooperatives.
• 21 percent of fishermen’s business also operates through cooperative societies.

A sector with deep roots, and political significance

India’s cooperative movement dates back to 1904, with the enactment of the Cooperative Credit Societies Act. By 1911, over 5,300 societies with more than 3 lakh members were registered, as per a report by The Indian Express.

Notably, on December 14, 1946, eight months before Independence, Amul, now one of the world’s most famous dairy cooperatives, was registered.

Post-Independence, cooperatives became a central part of Five-Year Plans. In 2002, under Prime Minister A B Vajpayee, the Multi-State Cooperative Societies Act was amended and the first National Cooperative Policy introduced. Later, the 97th Constitutional Amendment (2011) under the UPA government gave constitutional status to cooperatives.

Politics and cooperatives: Still a strong link

Cooperatives are politically influential, especially in Maharashtra and Gujarat. Of the 8.4 lakh registered societies, Maharashtra accounts for 2.24 lakh and Gujarat for 85,370, as per the The Indian Express report.

Former NAFED chairman Bijender Singh says the cooperative network’s political clout remains concentrated in these two states, where several prominent leaders actively participate in cooperative politics.

Shah’s ministry has been expanding the network into states like Uttar Pradesh and Bihar, aiming for a more nationwide presence.