The organized cooperative movement in India has a history of over 125 years, marked by many achievements. Amul is its most prominent example, now studied as a case model worldwide. However, over time, the cooperative sector has faced several shortcomings and fresh challenges. Delayed elections in many cooperative societies fostered corruption, while outdated bylaws in others became bottlenecks. It is well known that only the cooperative sector can effectively compete with multinational corporations. To strengthen this very sector, a new Ministry of Cooperation was established in 2021, and after 23 years, the National Cooperative Policy 2025 has been announced. The policy lays out a blueprint to professionalize and empower the cooperative movement.
Releasing the policy, Union Home and Cooperation Minister Amit Shah called it a historic step toward realizing Prime Minister Narendra Modi’s vision of “Prosperity through Cooperation” (Sahkar Se Samriddhi). The government aims to make India the world’s third-largest economy by 2027. Shah noted: “In the past four years, many significant steps have been taken for the cooperative sector. Those who once declared cooperatives dead, now call them the future.”
The new policy focuses on strengthening the cooperative sector to achieve the goal of a developed India by 2047 through “Prosperity through Cooperation.” According to Shah: “Only cooperatives, by bringing together 1.4 billion people, hold the capacity for India’s holistic economic growth. Therefore, while drafting the new policy, the focus was kept on the 1.4 billion people—villages, farmers, youth, rural women, Dalits, and tribals.”
Dr. Chandrapal Singh, Chairman of Krishak Bharati Cooperative Limited (KRIBHCO) and President of International Cooperative Alliance (Asia-Pacific), explained further in a conversation with Rural World: “Our primary objective is to strengthen the rural economy, ensure farmers’ prosperity, enhance farm productivity, provide low-interest loans through banks, and supply seeds and fertilizers in the right quantity, at the right price, and at the right time.”
Target: One Cooperative Society in Every Village
After the Ministry of Cooperation was created in 2021, work began in September 2022 on drafting the new policy. A 48-member committee led by former Union Minister Suresh Prabhu was set up. After extensive consultations with stakeholders, 648 suggestions were collected to prepare the policy draft.
The National Cooperative Policy 2025 provides a roadmap to make cooperatives professional, transparent, tech-enabled, innovative, and accountable. The policy envisions at least one cooperative unit in every village. It also suggests expanding their scope into new areas such as tourism, taxi services, insurance, and green energy. Cooperative taxis are already a step in this direction. Additionally, three new national cooperative bodies have been established to boost exports, seed marketing, and organic products.
Dr. Chandrapal Singh emphasized: “Our constant effort is to ensure that cooperatives reach every single village. India already has about 800,000 cooperative societies covering 90–95% of villages. But we must raise awareness so that cooperatives reach every individual.”
According to the ministry, India currently has over 850,000 cooperative societies, including 200,000 credit societies and 600,000 non-credit societies covering housing, dairy, fisheries, and other sectors. With more than 300 million members, these societies form a strong base for the rural economy. However, their contribution to GDP remains relatively small. The new policy outlines a roadmap to bridge this gap.
Goal: Triple the Contribution to GDP
The central government aims to triple the cooperative sector’s contribution to GDP by 2034. Fifty crore (500 million) citizens who are currently inactive or non-members of cooperatives will be brought in as active members. The number of cooperative societies will also be increased by 30%. Every panchayat will have at least one primary cooperative unit, such as a Primary Agricultural Credit Society (PACS), primary dairy, fisheries, or multipurpose PACS. These units will also generate more employment opportunities for youth.
To ensure transparency and institutional trust, a cluster-based monitoring mechanism will be developed. Devendra Kumar Singh, Chairperson of the Cooperative Election Authority and former Cooperation Secretary, explained: “The government’s approach has been inclusive, covering the entire cooperative ecosystem. Model bylaws have been prepared for PACS to strengthen the foundation. A remarkable achievement is that all state governments have adopted these model bylaws. This reform enables PACS to evolve into multipurpose business entities.”
Work on establishing 45,000 new PACS and computerizing them is nearly complete. Of the 25 new functions assigned to PACS, progress has been made in each. So far, 4,108 PACS have been approved to run Jan Aushadhi (generic medicine) centers, 393 PACS have applied to operate petrol and diesel retail outlets, and more than 100 PACS have applied for LPG distribution. PACS are also engaged in schemes such as Har Ghar Nal Se Jal (tap water in every home) and PM Surya Ghar (solar rooftop).
Linking cooperatives with the goal of Atmanirbhar Bharat (Self-Reliant India), Amit Shah said: “This cooperative policy will integrate rural and agricultural ecosystems, and empower the poor as a reliable part of the economy. We have prepared a roadmap for balanced cooperative development in every state. The policy is visionary, practical, and result-oriented. By 2047, on the centenary of independence, the cooperative movement will stand strong on this foundation.”
How the New Policy Will Be Implemented
The first national cooperative policy was introduced in 2002, when the internet had not yet reached villages. Today, with Digital India, e-commerce, and expanding market access, cooperatives need new momentum. Globalization, digitization, and socio-economic changes have further highlighted the need for strengthening the sector. At the same time, poor financial health, weak governance, lack of transparency, and political interference have hindered progress—underscoring the need for a new policy.
For effective implementation, a multi-tier mechanism has been proposed. A dedicated Implementation Cell will be set up in the Ministry of Cooperation. A National Steering Committee chaired by the Union Cooperation Minister will oversee the policy. A Policy Implementation and Monitoring Committee, headed by the Cooperation Secretary, will coordinate with states, resolve implementation bottlenecks, and regularly monitor and evaluate progress.
Youth, Cooperation, and Innovation
The policy places special emphasis on encouraging youth to build careers in the cooperative sector. Professional education and training will be provided across cooperative-linked sectors. A national apex body will be set up for training and connecting youth to the cooperative system, working in coordination with state-level cooperative training institutes. The establishment of Tribhuvan Cooperative University is a step in this direction.
Transparent Elections in Cooperatives
The policy lays strong emphasis on timely and transparent elections in cooperative societies. District collectors are required to notify elections, publish notices in local newspapers, and upload details on the society’s website. For multi-state societies, where members come from two or three states, members often did not even know when elections were being held.
According to Devendra Kumar Singh, “The establishment of the Cooperative Election Authority (CEA) under Section 45 of the Multi-State Cooperative Societies Act has been the most significant governance reform. Earlier, societies conducted their own elections, often lacking transparency. With this authority in place, the process has become much more transparent.”
Other Provisions for Strengthening Cooperatives
The policy also envisions organized mechanisms for training and skill development of people working in the sector. Centers of excellence will be established for cooperative education, research, and innovation. Social enterprise incubators will be set up in new and emerging sectors to promote entrepreneurship at rural and community levels.
A National Digital Cooperative Employment Exchange has been proposed to connect qualified candidates directly with cooperative institutions in a transparent manner. A national teacher and trainer database will also be created to streamline recruitment. Training programs in market-oriented skills like refrigeration, aquaculture, and farm management are also planned. Now, the only thing needed is effective and honest implementation of this policy.