Lok Sabha Question No. 4082 (UNSTARRED), answered on 2026-03-17
Subject: Weak Functioning of Cooperative Institutions
Ministry: COOPERATION
Asked by: Shri Zia Ur Rehman

## GOVERNMENT OF INDIA MINISTRY OF COOPERATION

## LOK SABHA UNSTARRED QUESTION NO. 4082 TO BE ANSWERED ON 17 th  MARCH 2026

## Weak Functioning of Cooperative Institutions

## 4082. Shri Jia Ur Rahman:

Will the Minister of COOPERATION ( सहकारिता मंत्री ) be pleased to state:

- (a) whether the Government is aware of the weak functioning and limited outreach of cooperative institutions in Western Uttar Pradesh, particularly in agriculture, credit and dairy sectors;
- (b) if so, the details of the steps taken to strengthen cooperatives and enhance their role in the region;
- (c) whether similar issues are affecting cooperative societies across the country; and
- (d) if so, the details thereof along with the measures undertaken at the national level to revitalise and modernise the cooperative sector?

## ANSWER

## THE MINISTER OF COOPERATION सहकारिता मंत्री (SHRI AMIT SHAH)

(a) to (d): The functioning and outreach of cooperative institutions in Western Uttar Pradesh reflect broader systemic challenges faced by cooperative societies in various parts of the country. In the past,  several  constraints  have  been  observed  such  as  the  narrow  functional  scope  of  Primary Agricultural  Credit  Societies  (PACS),  limited  professional  management  capacity,  inadequate access  to  affordable  institutional  credit,  and  financial  constraints  for  developing  modern infrastructure.

The Ministry of Cooperation with vision of 'Sahkar se Samridhi' has undertaken  more than 140 initiatives since its inception to create an enabling legal, economic and institutional framework to  strengthen  the  cooperative  movement  at  the  grassroots  level  and  transform  cooperative enterprises into professionally managed, transparent, technology-enabled and vibrant economic entities. In this regard, several targeted measures have been implemented to revitalize cooperatives in agriculture, credit, dairy and allied sectors across the country, including Western Uttar Pradesh, as detailed below:

· Infrastructure  Assistance: National  Cooperative  Development  Corporation  (NCDC),  a statutory body under the administrative control of the Ministry of Cooperation, provides financial assistance for cooperative development across a wide range of notified commodities and services. NCDC supports creation of agricultural and allied infrastructure, value chain development, and capacity building of cooperative institutions. As on 25.02.2026, NCDC has cumulatively disbursed ₹5,16,122.32 crore for the development of cooperative institutions across the country, out of which ₹7,749.08  crore  has  been  disbursed  in  Uttar  Pradesh.  In  Moradabad  district,  an  Integrated Cooperative  Development  Project  (ICDP)  has  also  been  implemented  to  provide  credit  and infrastructure support to cooperatives.

· Diversification of PACS: PACS across the country are being transformed into Multi-Service Centres with new model bye laws enabling them to undertake 25 additional economic activities besides credit disbursal to meet the diverse needs of rural communities. In districts such as Jhansi and Chandauli in Uttar Pradesh, PACS have been diversified to operate fertilizer centres under Pradhan Mantri Kisan Samriddhi Kendras (PMKSK) and generic medicine stores under Pradhan Mantri Bhartiya Janaushadhi Kendras (PMBJK).

· Dairy  Development: Under  the White  Revolution  2.0 initiative,  new  multipurpose  dairy cooperative societies are being registered and strengthened to enhance milk procurement, improve market access for farmers, and reduce the role of unorganized intermediaries in the dairy value chain.

· Revival  and  Strengthening  of  Cooperative  Sugar  Mills: Cooperative  sugar  mills  play  an important  role  in  the  rural  economy  of  several  states  including   Western  Uttar  Pradesh  where sugarcane cultivation is  a major agricultural activity. However, a number of cooperative sugar mills across the country have faced operational and financial challenges leading to closure or suboptimal  functioning.  The  Ministry  of  Cooperation  is working  for  revival  of closed/sick Cooperative  Sugar  Mills  (CSMs)  in  coordination  with  the  concerned  State  Governments. The initiative  aims  to  strengthen the cooperative sugar sector, enhance value addition and improve livelihood opportunities of farmers associated with sugarcane cultivation. Additionally, under a scheme for strengthening of cooperative sugar mills, over Rs.10,000 cr of financial assistance has been made available to cooperative sugar mills to support their expansion plans and meet their working capital needs

· M-PACS and Universal Coverage: A national plan has been launched to establish 2 lakh new multipurpose PACS, dairy and fishery cooperative societies so that every uncovered Panchayat has at least one functional cooperative institution by the year 2028. Over 32,000 societies have already been established under the programme.

· PACS  Computerization: A  Centrally  Sponsored  Project  with  a  total  financial  outlay  of ₹2,925.39 crore is being implemented to computerize 63,000 functional PACS by onboarding them onto  a  common  ERP-based  national  software.  Under  this  project,  till  date  Uttar  Pradesh  has received financial assistance of ₹67.10 crore for hardware procurement and deployment of ERP software at the PACS level.

· Banking Reforms: Measures have been taken to improve the flow of credit through cooperative banking institutions. District and State cooperative banks have been strengthened and Sahakar Sarathi has  been  established  to  provide  new  age  shared  technology  services  such  as  UPI  and digital banking solutions to cooperative institutions.

· New  National  Federations: Three new  national-level cooperative societies-National Cooperative  Exports  Limited  (NCEL),  National  Cooperative  Organics  Limited  (NCOL)  and Bharatiya  Beej  Sahakari  Samiti  Limited  (BBSSL)-have  been  established  to  enable  primary cooperatives to access national and international markets for exports, organic products and quality seeds.

· Governance  and  Accountability: Institutional  reforms  such  as  the  establishment  of  the Cooperative Election Authority (CEA) and the provision for a Cooperative Ombudsman have been introduced to ensure democratic functioning, transparency and effective grievance redressal in cooperative institutions.

These  measures  are  aimed  at  strengthening  cooperative  institutions,  expanding  their outreach  and  enhancing  their  role  in  supporting  farmers,  rural  livelihoods  and  local  economic development across the country, including Western Uttar Pradesh.

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