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Current Affairs

Cooperation ministry

Date: 10 July 2021 Tags: Miscellaneous


The union government has set up a separate ministry for Cooperation during the recent cabinet expansion process.



Previously, there was no separate emphasis on cooperative sector. The subject was under the purview of Ministry of Agriculture.



  • The objective of the ministry of cooperation is said to be forming separate administrative and legal framework for strengthening cooperative sector in India.

  • The ministry will work towards developing Multi-State Co-operatives (MSCS) and enable ‘Ease of doing business’ for cooperatives.


Cooperative movement

  • They are organization formed by people at the grassroots level to obtain a collective bargaining power for achieving common objectives.

  • Some of the sectors where cooperatives operate are agriculture, spinning mills, sugar mills, dairies etc. They are jointly set up by farmers aiming to process their products.

  • Cooperatives have become particularly important in several streams such as milk production in the country. About 35 percent of sugar is produced through cooperatives.

  • Cooperatives are also involved in financial institutions especially in rural and semi-urban areas to give credit to unorganized sector.

  • The district central cooperative banks (DCCBs) and state cooperative banks sit at the top of structure and control flow of finances in rural areas.

  • Several individuals and sectors can get credit due to the urban cooperative societies, which otherwise not possible under institutional system.


Need for ministry

  • Cooperative sector has managed to flourish in only handful of states such as Karnataka, Gujarat and Maharashtra.

  • The funds given in form of working capital and equity have only reached these states. Other states have not been able to get advantage.


Political importance

  • Politics of Maharashtra is controlled by cooperatives. They elect the chairman democratically and give rise to new leadership.

  • Winning elections in states such as Maharashtra can only be possible if cooperative sectors can be controlled and influenced.