Study of commodity cooperatives as institutions to address rural poverty

Abstract

Poverty reduction strategies in most developing countries are focused on building infrastructure, provision of basic services and improving effectiveness of peoples' institutions for gaining sustained incomes and livelihoods. Commodity cooperatives can be effective institutions to achieve poverty reduction and ensuring social equity. However, in spite of its century long heritage and remarkable achievement in creating the largest cooperative network in the world cooperatives in India are perceived to have been largely ineffectual in translating into vehicles of poverty reduction. Cooperatives in India gives have enjoyed outstanding success only in a few isolated pockets of the country, while they have been marginally effective in rest of the country. The study is an attempt to draws lessons from members of three Cooperative Federations/Unions located in the tribal concentrated districts of Anantapur and Adilabad in Andhra Pradesh and Sambalpur in Odisha. These commodity cooperatives have been promoted as per the provisions of the progressive enactments that provide scope for independent functioning bereft of Government and political interference. This paper adopts a case study mode and attempts to provide a lead in identifying crucial policy issues concerning commodity cooperatives. The aim is to outline some of the thrust areas that would constitute a comprehensive reform package in the domain of cooperative policymaking. The study reflects that rural producers and gatherers can own and operate an enterprise provided they are given the initial support and guidance by facilitative organizations that believe in the principles of cooperation . It is felt that well targeted reforms would certainly facilitate the process of cooperative repositioning, thus enabling the cooperatives to retain their competitive advantage in the changing scenario.