Co-op ministry: Democratising development?

Last Updated 19 August 2021, 06:51 IST

The Union government has formed a separate Ministry of Co-operation, expecting to strengthen the co-operatives movement in the country in order to realise the vision of “Sahkar Se Samriddhi” by improving the “ease of doing businesses for co-operatives”, especially of multi-state co-operative societies.

Many believe that it is a good move, considering the sad state of co-operatives in the country in general, but especially in the eastern parts of India. The demand to make co-operatives in the country more democratic, self-reliant and dynamic institutions has been there for a while. There have been allegations that co-operatives regularly violate the letter and spirit of the law governing them when it comes to the election of board members, maintenance of records and audits, transparency in business, and in containing corruption. The formation of a separate Union Ministry of Co-operation is viewed as a panacea for all the ills plaguing the cooperatives sector.

Co-operatives have a greater role in fostering rural development and ameliorating the living conditions of the marginalised. The co-operative form of business takes care of distributional issues in the economic processes; therefore, it has become an organisation type suitable for protecting the interests of people who missed the bus of modern-day economic development. It is found that in spite of the significant success of co-operatives around the world, India lags in embarking on such wonderful institutions that work on the philosophy of economic democracy and aiming at democratising development with an inclusive framework.

Therefore, in the current Indian context, which is characterised by worsening inequalities, particularly a development process that bypassed hundreds of millions of rural people dependent on agriculture for a livelihood, the co-operative form of organisation is the path for rural development.

It is underlined that strengthening grassroots-level democratic institutions, wherein the panchayats and co-operatives are part of a wider concept of ‘social solidarity economy’. For instance, in the case of Kerala and Maharashtra, it has been argued that the rise of a considerable number of co-operatives in these two states is a major reason for the development of their rural areas.

Meanwhile, the formation of a new Ministry of Co-operation by the Narendra Modi government has not gone down well with the opposition parties and various state governments in the country. There is nothing surprising in it as the co-operatives model has been a source of political power in many states, including Kerala, Maharashtra, Gujarat, Karnataka, Tamil Nadu, Madhya Pradesh and West Bengal.

A major criticism is that the Union government is weakening the ‘Co-operative Federalism’ by means of encroaching into an area of state governments’ prerogative as co-operatives come under the State List in the Constitution’s federal scheme. Creating a Union ministry without an Act of Parliament, endorsed by state legislatures, has also raised a few eyebrows and many view it as brazen move by the current political regime at the Centre to hijack the co-operatives movement across the country.

This ‘political monopoly’ of the states (as the legal framework in which co-operatives are to operate was framed by the states) got quashed by the formation of the Union ministry and the Union government is accused of making co-operatives a tool to get political mileage through doling out political patronage.

Meanwhile, it is also important to note that politics is in one way or the other deeply inherent in the co-operative structure. Eminent sociologist B S Baviskar, while writing on co-operatives and politics in India way back in 1968, observed that given universal adult suffrage and democratic decentralisation in the form of Panchayati Raj, some degree of politics seems to be built into the co-operatives structure. Baviskar was of the opinion that “co-operatives perform certain latent political functions which are significant from the point of view of the political development of a democratic society”.

The importance of co-operatives arises at the current juncture due to widening inequalities under the free market economic system, where people have lost belief in the private sector. The condition of India’s poor has become much more pathetic due to the Covid-19 pandemic. It is observed that communities having strong solidarity amongst themselves could minimise the adverse effects of the pandemic. Therefore, it is the need of the hour to rejuvenate co-operative ideology in its true sense in India. Enlightened Indians should see the opportunities emerging from the new initiatives by the Union government in building up the social solidarity economy in which the development approach becomes people-centric. India’s leadership should be consultative in nature, and it is time for a determined campaign to build a cadre of young leaders of co-operatives who know the co-operative principles and are keen to work for the betterment of humanity.

(Jose is Professor, Amity School of Economics, Amity University Haryana; Jos Chathukulam is former professor, Institute for Social and Economic Change, Bengaluru)

(Published 19 August 2021, 06:17 IST)

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