Sahkar Se Samriddhi: Reimagining India Cooperative Movement for Inclusive Growth

India’s Cooperative Movement and the Promise of Shared Prosperity

India’s cooperative movement draws strength from a civilisational ethic that views economic life as a collective endeavour. The idea of Vasudhaiva Kutumbakam —the world as one family—has long shaped India’s understanding of welfare, participation and shared responsibility. In 2025, as the world observes the International Year of Cooperatives, India’s renewed focus on the cooperative sector under the vision of Sahkar Se Samriddhi reflects an attempt to align this tradition with the demands of a modern, market-linked economy.

Global relevance, local resonance

Cooperatives occupy a distinctive place in the global development discourse. As member-owned and member-governed institutions, they combine economic activity with social purpose, offering resilience in times of inequality, market volatility and climate stress. The United Nations’ decision to mark 2025 as the International Year of Cooperatives underscores their role in advancing inclusive growth and the Sustainable Development Goals.

For India, this global recognition coincides with domestic priorities. With deep rural penetration and a history of participatory institutions, cooperatives offer a development pathway that complements decentralisation, inclusion and grassroots democracy.

Historical roots and institutional evolution

The cooperative idea in India took legal form during the colonial period with the Cooperative Credit Societies Act of 1904, aimed at protecting farmers from exploitative moneylenders. After Independence, cooperatives were consciously embedded into the framework of planned development, particularly in agriculture, dairy and rural credit.

Over time, institutions such as the National Cooperative Development Corporation and the National Bank for Agriculture and Rural Development strengthened financing, capacity-building and oversight. The creation of a dedicated Ministry of Cooperation in 2021 marked a significant policy shift, signalling the government’s intent to treat cooperatives as a core pillar of economic governance rather than a residual sector.

Scale and diversity of the cooperative ecosystem

India today hosts one of the world’s largest cooperative ecosystems. Over 8.5 lakh cooperative societies, with hundreds of millions of members, operate across sectors such as agriculture, dairy, fisheries, housing, banking and women’s self-help. From iconic brands like Amul to grassroots Primary Agricultural Credit Societies (PACS), cooperatives connect producers to markets while anchoring livelihoods at the village level.

Their reach—covering nearly all rural districts—makes cooperatives uniquely positioned to act as instruments of last-mile delivery and local economic integration.

Reforming PACS: from legacy institutions to service hubs

A central focus of recent reforms has been the revitalisation of PACS. Updated model bye-laws have expanded their permissible activities, enabled greater inclusion of women and marginalised communities, and strengthened internal governance. Many States have adopted these reforms, creating a more uniform and flexible cooperative framework.

Equally transformative is the push towards digitalisation. ERP-based computerisation of PACS, linked with cooperative banks and NABARD, is improving transparency, auditability and service delivery. This digital shift aims not only at efficiency, but also at rebuilding trust in cooperative institutions that had suffered from opacity and mismanagement.

Cooperatives and last-mile governance

Cooperatives are increasingly being integrated into the delivery of public services. PACS functioning as farmer service centres, digital access points, medicine outlets and even fuel retail units reflect a new approach: using community-owned institutions as interfaces between the state and citizens. This model reduces transaction costs, enhances local accountability and embeds welfare delivery within familiar institutions.

Parallelly, the promotion of farmer and fish farmer producer organisations through cooperative structures is strengthening aggregation, value addition and bargaining power while preserving collective ownership.

Storage, dairy and market integration

Large-scale initiatives such as decentralised grain storage through cooperatives aim to address chronic post-harvest losses and stabilise farm incomes. The renewed focus on dairy expansion through cooperative networks, often described as a second phase of the White Revolution, seeks to extend benefits to underserved regions and women producers.

New national-level cooperatives for exports and organic produce indicate a strategic shift—from subsistence-oriented cooperation to market-linked, quality-driven and globally connected models.

Building capacity and credibility

Institutional strength ultimately depends on human capacity. The establishment of a national cooperative university, along with large-scale training programmes for cooperative leaders, addresses long-standing gaps in professional management and governance. Financial reforms, tax relief and revival packages further aim to restore economic viability and competitiveness.

Conclusion

India’s cooperative reforms, aligned with the International Year of Cooperatives 2025, represent more than administrative fine-tuning. They reflect an effort to reimagine cooperatives as modern, digitally enabled and market-integrated institutions, without diluting their social ethos. In an era of rural distress, employment challenges and climate uncertainty, cooperatives offer India a distinctive development pathway—one that blends efficiency with equity, and growth with participation.