The Indian government is taking significant steps to bolster the rural economy and empower farmers through the establishment of agriculture-focused cooperative societies. According to NITI Aayog member Ramesh Chand, a robust movement towards rural cooperatives is underway. The government’s plan is to set up cooperative societies in every village where they currently don’t exist, focusing initially on agri-business activities. This initiative is aimed at strengthening the cooperative movement and promoting “prosperity through cooperation.”
The first phase of this endeavor involves the creation of cooperatives centered around agri-business in villages lacking such entities. These cooperatives will not only deal with farm produce but will also extend their activities to other products and sectors. The expansion could encompass storage of agricultural products and even facilitate exports, thereby enhancing the economic potential of rural areas.
The government’s commitment to strengthening farmer producer organizations (FPOs) is evident through the recent launch of 1,600 FPOs on the Open Network Digital Commerce (ONDC) platform. This initiative, launched by Prime Minister Narendra Modi, holds the potential to revolutionize agriculture marketing. ONDC enables FPOs to sell their produce to wholesalers, businesses, and consumers directly, bypassing intermediaries and traditional supply chain constraints. Importantly, state-level agriculture produce marketing committee (APMC) Acts do not apply to electronic transactions, providing a regulatory framework for these new modes of trade.
The drive to integrate FPOs into ONDC does not require separate budget allocation, and necessary capacity-building will be undertaken by an agency under the agriculture ministry. The ultimate goal of these measures is to improve the income and livelihoods of farmers, a central objective of the government.
These initiatives are particularly relevant in the current context, as they aim to promote entrepreneurship among farmers and encourage community-based development through cooperatives. This approach comes as efforts to attract private sector investment in the agricultural sector have faced challenges due to ongoing farmer protests against certain provisions of the new farm laws.
To ensure effective implementation and coordination, the government is working towards establishing a national database of cooperatives. This comprehensive database will provide insights into the distribution and gaps in the cooperative network, aiding policymaking for a more inclusive and economically vibrant rural landscape.
The government’s initiatives also extend to enabling decentralized grain storage facilities by allowing more than 100,000 farm credit societies with around 130 million farmer members to set up such facilities. This move is geared towards reducing wastage and enhancing the financial viability of cooperative entities.
Overall, these concerted efforts to promote rural cooperatives are part of a larger strategy to drive rural prosperity, enhance farmer income, and foster sustainable agricultural development in the country.