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Challenges Faced by Cooperatives

The document discusses the poor performance of the cooperative movement in India despite 100 years of existence. It identifies several causes for this including government interference, mismanagement, lack of awareness, limited coverage, and functional weaknesses. Other issues mentioned are increasing commercial banks in rural areas, fraud, corruption, more political intervention, lack of training and technology. It states that cooperatives lack self-reliance and are heavily dependent on government assistance. Elections are irregular and there is undue political interference in day-to-day affairs. Reforms are needed in registration procedures, government interference, management practices, and business operations. Amul is provided as a successful example of a dairy cooperative in India.

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Parvathy Kartha
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68 views12 pages

Challenges Faced by Cooperatives

The document discusses the poor performance of the cooperative movement in India despite 100 years of existence. It identifies several causes for this including government interference, mismanagement, lack of awareness, limited coverage, and functional weaknesses. Other issues mentioned are increasing commercial banks in rural areas, fraud, corruption, more political intervention, lack of training and technology. It states that cooperatives lack self-reliance and are heavily dependent on government assistance. Elections are irregular and there is undue political interference in day-to-day affairs. Reforms are needed in registration procedures, government interference, management practices, and business operations. Amul is provided as a successful example of a dairy cooperative in India.

Uploaded by

Parvathy Kartha
Copyright
© Attribution Non-Commercial (BY-NC)
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Parvathy K Roll No.

21 Sixth Sem, BBA,LLB(Hon)

Despite rapid growth the overall progress of cooperative movement during 100 years of its existence is not very impressive. It is therefore necessary to know the causes of poor performance of the movement and on that basis take such steps as would promote a faster growth of cooperative movement in India.
1) 2) 3) 4) 5) Government Interference Mismanagement and manipulation Lack of Awareness Restricted Coverage Functional Weakness

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Increasing no. of commercial banks in rural areas Fraud & Corruption Financial Crises More political intervention Lack of Training Lack of technology

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Heavy erosion in their democratic and autonomous functioning. Most of the grassroots co-operatives are not self-reliant and heavily dependent on Government Assistance. Management not responsive to the needs of the members and not truly accountable to them. Sickness is increasing resulting in large number of defunct/ dormant societies. Co-operatives are not well equipped to face the challenges of open and competitive market oriented economy. As a result, they are not only loosing ground in their traditional areas of activities but also unable to enter into new ventures

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Elections are not held regularly. Supersession of Board of Directors and appointment of Administrators for undue longer period. General Body meetings are not held regularly. Audit is not professional. It is also not conducted in time. There is undue and unnecessary political interference and bureaucratic control even in their day-to-day affairs. Unprofessional management leading to high operational cost and delayed delivery of services to members. Lack of member participation. Poor system of monitoring and inadequate checks and balances.

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The products are neither popular among customers nor profitable to the institution themselves. Stiff competition from private Poor participation of members Weak financial base of societies Absence of professional management Ever growing corruption and frauds, etc

1.
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Cooperative Reforms

Simplified procedure for registration Removal of unwanted govt. interferences Members of non political background Defined rules & procedures

2. Administrative Reforms
Debureaucratisation Professional Management & staff Skill building/ skill upgradation of staff Adoption of uniform accounting procedures.

3. Business Reforms
After scanning environment development plan should be made The plans should be quantifiable & measurable with specified time frame for achievement. Empowered monitoring scheme.

AMUL-ANAND MILKPRODUCERS UNION LIMITED FORMED IN DEC,1946, & STARTED A DAIRY COOPERATIVE MOVEMENT
IN INDIA UNDER THE LEADERSHIP OF VARGHESE KURIAN. IT IS A BRAND NAME MANAGED BY AN APEX COOPERATIVE ORGANISATION, GUJARAT CO-OPERATIVE MILK MARKETING FEDERATION LTD. (GCMMF), STARTED WITH 2 VILLAGE HAVING 250 LTRS/DAY MILK WHICH TODAY IS JOINTLY OWNED BY SOME 2.8 MILLION MILK PRODUCERS IN GUJARAT, WITH MILK COLLECTION AVERAGE OF 10 MILLION LITRES/DAY IT IS ALSO THE WORLD'S BIGGEST VEGETARIAN CHEESE BRAND.

y Automatic Milk Collection System units (AMCUS) at village

societies were installed in the first phase to automate milk producers logistics. y AMCUS facilitated to capture member information, milk fat contents, volume collected and amount payable to each members electronically via a plastic card for identification.

 Now officials at AMUL are planning to upgrade the plastic card to SMART cards to facilitate farmers to withdraw money from ATMs Initiatives have been taken for online order placement for AMULs products as a result of which AMUL is today exporting products to West Asia, Africa and U.S.A. AMUL also planning to double the production by 2020 to fulfill the future demand.

Cooperative have a unique place in growth of the rural India, this is the only tool by which the problem of scarcity of resources can be eliminated. But there is a need to revamp the cooperatives structure & status to achieve the full fledged benefits of it.

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