|Introduction: Contextual introduction.|
Body: Explain some government initiatives for promoting the cooperative sector in India.
Conclusion: Write a way forward.
Cooperative societies help small-scale entrepreneurs procure raw materials at discounted rates and reduce production costs. They provide producers with a platform to sell their products directly to consumers by removing intermediaries, which helps cut the selling price and ensure higher sales and profits for producers.
Government initiatives for promoting the cooperative sector:
- Ministry for cooperation: It will provide a separate administrative, legal and policy framework for strengthening the cooperative movement in the country.
- Setting up of massive, decentralised storage capacity so that farmers can store their produce and realise remunerative prices by selling at an appropriate time. This will be the world’s largest grain storage facility.
- To promote the growth of new cooperative manufacturing societies, the budget has announced a concessional income tax rate of 15% for cooperatives that begin manufacturing before March 31, 2024.
- Cooperative societies have been given a higher limit of Rs 3 crore for tax deducted at source on cash withdrawals. For sugar cooperative mills, the claims for payment made to sugar farmers before the assessment year 2016-17 will now be considered an ‘expenditure’. This is expected to provide approximately Rs 10,000 crore in relief to the sugar cooperatives.
- The government is establishing a national database of cooperatives and a National Cooperative University to provide trained manpower to this sector.
- Further, under the PM’s leadership a committee has been constituted by the cooperation ministry to formulate a National Cooperative Policy, which will include stakeholders’ recommendations and become a vital link to connect the masses with the country’s financial system.
- The budget also announced that model bye-laws for primary agricultural cooperative societies (PACs) are being formulated, to enable them to become multipurpose cooperatives to meet the country’s diverse needs and remain financially profitable.
- Recently an MoU has been signed among the cooperation ministry, the IT ministry, NABARD, and CSC e-Governance Services India Limited. This MoU will enable PACS to provide the services offered by the Common Service Centre.
Given the way PM, with the resolve of ‘Sahakar Se Sammriddhi’, has brought cooperatives to the forefront of the nation’s economic discourse, they will soon be one of the main drivers of India’s growth engine.