Policy framework for leveraging co-operative advantagewith special reference to co-operatives in the state of Andhra Pradesh

Abstract

Co-operation is a basic and innate quality inherent in all living beings and is thebedrock of any civilization. The concept is older than the Co-operative movement itself whichhad a humble beginning in Fenwick, Scotland in 1761 in the backdrop of the ills of the FactorySystem during the Industrial Revolution. However, the Rochdale Equitable Pioneers Societyestablished in 1844 in Rochdale, England is regarded as the prototype of the modern day CooperativeSociety. The pioneers pooled their resources and showed to the world the powerof collective action besides redefining the business principles and forcing the markets tobehave. Their success led to the spread of Co-operation to other parts of the world and by2015, the International Co-operative Alliance (ICA), Geneva represents 289 MemberOrganizations spread across 95 Countries, giving a voice to 1 billion individuals and providingemployment to over 250 million.The Indian Co-operative movement, on the other hand, did not grow out of the soil ofthe Country but was implanted by the imperial rulers in the credit sector in 1894 as an answerto the then prevailing distress and discontent in the agricultural sector. Though, the sectordiversified immensely and thrived manifold under close State Partnership, the twin factors ofbureaucratization and politicization led to an acute governance and managerial failure. TheSector is plagued with various other impairments such as non-conduct of elections, en massesupersession of Boards, costly loaning protocols, multiple layers of federations etc. and lostthereby its democratic functioning and autonomy.Several of the High Powered Commissions, Committees and Task Forces whichgrappled with the question of reviving or winding up the Co-operatives finally recommendedin favour of continuing with the Co-operatives. After examining the success of world s top300 Co-operatives, which have an estimated global turnover of USD 2.2 Trillion comparableto the Gross Domestic Product of many large economies and assessing the factors for theirrobustness even during the global financial crisis of 2008, they zeroed on one factor viz., thetotal loss of Co-operative Identity and Character, as the root cause of the malady with theIndian Co-operatives.To address these infirmities and to build a strong, vibrant and prosperous Cooperativemovement, this policy memo seeks to recommend a Uniform Policy Framework intune with the UN Resolution No.56/114, the ILO Recommendation No. 193/2002, the 97thConstitutional Amendment Act, 2011 and the criteria suggested by Hagen Henry in ILO sGuidelines for Co-operative Legislation, 2012. The policy framework sets out the purpose,vision and mission statement for the Co-operatives along with the ways and means to achievethe same through a well-orchestrated Co-operative Strategy comprising of a supportive CooperativePolicy and a unified legal framework. Towards this end, the Policy recommendsinstituting legal and regulatory reforms, supporting computerization, enforcing standards anddiversifying the sector, gender mainstreaming etc. Its thrust would be to ensure that it is thepeople who would form the Co-operatives and ensure their functioning competitively andefficiently.