CO-OPERATIVE—DRIVER OF ECONOMY

[Published in Orissa Post on 20 May 2011]
Bikash Choudhury





'Amul' has long a conquered the household in India; now, very recently the comment "Amul Baby" became hot topic of spat between two powerful political activist; not very many people would be in the know about the organization behind the Amul brand, GCCMF otherwise known as Gujarat Milk Marketing Federation which is one of the most successful Co-operative not only in the country but, across the World with 2.9 million members,15322 village societies, 13.07 million liters of milk handling capacity per day and Rs.8005 crore of sales in 2009-10. Little known fact about GCMMF is the members have planted 2.35 crore saplings in last four years. Co-Operative sector has immense potential to shape the State Economy. Orissa Milk Marketing Federation has posted reasonable success in Co-operative sector in milk collection, processing, production of byproducts and marketing. In farm loan also Co-operative Banking system disburse largest amount of agricultural credit to farmers. There are many other small players in Co-Operatives sector in many other domains at local level. However, Co-Operative movement has not been able to demonstrate a transformational opportunity in the State like "Amul".

Cooperative sector can become one of the important drivers of Orissa State economy and turn out to be the largest employer of Highly Skilled to unskilled labor pool. New Co-Operative Minister must attempt to plug the long standing loop holes in our Co-Operative system, Administration and in accountability. Just like our new Agriculture policy, Cooperative minister can emphasize on a brand new Co-Operative policy that will encourage entrepreneurship and productivity in Co-Operative sector in Agriculture, Retail, Micro Finance & Micro Deposits, Wasteland Development and other growing services sector. The main objective of Co-Operative policy should be to streamline the functioning of elected representative so that they would pool their local knowledge in sustainable growth and profitability of the organization while providing opportunity to the professionals to do their job to their best of ability without fear or favor. Ideally elected representatives of cooperative and professional executive should work in a collaborative frame work in mutual interest and in the interest of the organization.

Co-Operative Banking system for Agricultural credit allied sector need to be institutionalized and Co-operative should have the freedom to source best of human resources in the given market condition to develop leaders to manage growing Co-Operative institutions in the State. It is very important to strengthen the Co-Operative farm credit delivery mechanism that would be sustainable in both in short and in long run. Co-operative credit institution needs to add domain knowledge in agric and agro sector to offer high quality service to their customer. They can introduce a Agriculture and Agro consulting division at apex level or at District level with an objective to make profits for farmers with their advice and market linkages. This can be only done by either hiring competent personnel at market rate or deploying retired professionals on contract.

Co-Operatives were the first to introduce Modern Retail in Orissa, through ‘Bhanjaprabha’ in Bhubaneswar, ‘Kamadhenu’ in Angul & ‘Indradhanu’ in Dhenkanal and many other small stand alone retail outlets which did not make much headway but, in the current times Co-operatives can reenter the Retail space as an aggregator of small grocery stores by providing them scale, technology, negotiating muscles and above all higher profitability by modernization while serving larger customer segments with extended Stock Keeping Units (SKU) as it is called in the retail Industry. Professionals need to drive the foray in retail as the context and customer has undergone sea change over the years. Professional run Co-Operative retail could actually give Private retail players a run for their money and at the same time can create huge employment opportunity in entire length and breadth of the State.

Our new Agriculture Policy has facilitated contract farming by corporate and co-operatives; therefore, our Co-Operative sector should take advantage of this opportunity and encourage High Value farming (Israel Type) instead of High volume farming currently practiced at the cost of farmers and their families. Each revenue block must have Agricultural Co-Operative comprising 5-15 villages with 2500-5000 acres of land. The Co-operative should use modern technology supported by local knowledge and resources to promote high value farming to grow the productivity and create employment potential for the people living in the hinter land. Co-Operatives must also take up post harvest processing, Ware housing, Cold storage and transportation to mitigate the challenges of logistics and strangle hold of middlemen. Successful farm Co-Operative can actually create a demonstration effect in the nearby rural pockets and therefore, spread the message of Co-Operation movement much more effectively.

When we travel by road or train, mostly find thousands of acres of land adjoining the route. The Co-Operative sector in association with respective habitation can organize Waste land development Co-Operative and plant “Jatropa” for green fuel. Such Co-Operative institutions also can develop other downstream Industry to create a complete Eco-System for green Energy and add substantially to the economy and brand image of the State. Similarly, Co-Operative Institution can create along the habitation of 480 Km long Coastline to plant mangroves, Jatropa to increase their productivity. Further, Co-Operative could be the most effective medium to reach out to “bottom of the pyramid’ through Micro Finance, Micro Deposit.

If State Govt. takes on the role of a powerful facilitator then, Co-Operative sector alone has the potential to contribute additional 1-2 % to the growth of Gross State Domestic Product (GSDP).