A reflection on the continuing relevance of Mahatma Gandhi’s principle of cooperation on his 156th birth anniversary – and on the role of cooperatives in transforming lives.
Competition
versus Cooperation
Competition seems to have become the guiding principle of our age. We
see it everywhere – among individuals, communities, organizations, businesses,
nations and, not least, political parties. Experts urge us to develop a
“competitive edge” or “competitive advantage” to outsmart others and succeed.
But has competition completely eclipsed cooperation, or does the latter still
have a place in our lives? Have cooperatives, which embody the spirit of
cooperation, failed to live up to their promise?
Why
Cooperation Matters
We humans are part of nature, where cooperation is fundamental. Atoms
form molecules; cells form tissues. Plants and animals depend on one another.
Air, water and sunlight together enable photosynthesis. Mountains, lakes, rivers
and soil sustain vibrant ecosystems. Even geographical formations emerge from
multiple forces acting in concert.
Human progress, too, is built on cooperation. Village communities once
shared meals and labour. Scientific breakthroughs – from the Human Genome
Project and space exploration to artificial intelligence– are products of
collaboration among scientists, universities, institutions and nations. Artists
and writers across the world have lamented human isolation and celebrated our
shared humanity. Can we afford to ignore the power of cooperation and let competition
alone shape modern life?
Gandhi and
the Ideal of Cooperation
Mahatma Gandhi placed cooperation at the heart of his struggle, both in
South Africa and India. He mobilized masses through collective effort. In Young
India, he wrote:
“Inter-dependence is and ought to be as much the ideal of man as
self-sufficiency. Man is a social being. Without inter-relation with society,
he cannot realize his oneness with the universe or suppress his egotism.”
Gandhi recognized that India lived in her villages, and that the social
and economic upliftment of the masses was possible only through mutual
cooperation. For him, cooperation among individuals and communities was
essential not only for material progress, but also for spiritual growth.
The
Cooperative Model – A “Third Way”
The 20th century was dominated by two economic systems: capitalism and
communism. Capitalism celebrates individualism, self-interest, free markets and
competition; Communism emphasizes collectivism, public enterprise and
government control.
Gandhi’s cooperative model offers a “third way.” Moving beyond the “one
for oneself” ethos of capitalism and the “one for all” ideal of communism,
cooperatives embody “one for all and all for one.” Far from being outdated,
cooperation is evermore essential today for sustainable and inclusive
development.
The Age of
Cooperatives
Those born soon after Independence remember the strong spirit of
cooperation Gandhi had championed. In the post-Independence era, cooperatives
became integral to the Five-Year Plans. Most state governments set up
Departments of Cooperation to promote them.
As a student, I saw cooperatives at work in many fields – agriculture,
industry, education, housing and beyond. Our college had a student cooperative
selling textbooks and stationery at reduced prices. Kerala even established the
first writers’ cooperative to help authors publish their books when funds were
scarce.
Cooperatives
in India
Cooperation, as we know it today, did not begin in India after
Independence. Like societies everywhere, Indian communities have always been
rooted in mutual support. As early as 1904, the Cooperative Credit Societies
Act was enacted by the British to address rural indebtedness; the 1912
Cooperative Societies Act broadened the scope to non-credit activities.
According to The Hindu newspaper, India today houses 8.14 lakh
cooperatives with a membership of 29 crore (290 million), the largest in the
world. Twenty percent are engaged in banking; the remaining 80 percent operate
in fields as diverse as fisheries, dairy, poultry, floriculture, housing,
warehousing, agro-processing, fertilizers, logistics, construction and
marketing. About 15 percent of total short-term credit is disbursed to 13 crore
farmer-members through 1 lakh Primary Agricultural Credit Societies (PACS).
Cooperatives handle 30 percent of India’s sugar production, 35 percent of
fertilizer distribution, 20 percent of paddy procurement and 13 percent of
wheat procurement. Their share in total direct employment is estimated at 13.3
percent.
Through collective effort, cooperatives have built large enterprises
like Amul (Anand Milk Union Ltd) of the Gujarat Cooperative Milk Marketing
Federation; fertilizer giants Indian Farmers Fertiliser Cooperative (IFFCO) and
Krishak Bharati Cooperative (Kribhco); and marketing major National
Agricultural Cooperative Marketing Federation of India (NAFED).
The Taste
of India
Among India’s cooperatives, Amul stands out. Founded in 1946 by
Tribhuvandas Kishibhai Patel, it is owned by the Gujarat Cooperative Milk
Marketing Federation, representing 3.6 million milk producers. I was fortunate
to visit the Amul complex in Kheda district in Gujarat a few years ago.
Verghese Kurien, who joined Amul in 1949 and later became its chairman,
played a key role in India’s “White Revolution,” making the country the world’s
largest producer of milk and milk products. Another example is Dhara cooking
oil, an initiative of the National Dairy Development Board, itself a
cooperative. I still regularly buy both products.
Cooperatives and micro, small and medium enterprises (MSMEs) have
enormous potential for inclusive and sustainable development. Working with
small member groups and entrepreneurs, they promote self-reliance, generate
employment and ensure bottom-up development by engaging communities in growth
processes.
The Failure
of Many Cooperatives
The 1991 economic reforms shifted focus to market-driven growth. Moreover,
many cooperatives struggled under politicization and inefficiency. While brands
like Amul flourished, others that began with zeal later failed. Key reasons
included political interference, bureaucratic control, corruption, poor
professional management, limited market access, technological backwardness,
siloed functioning, poor member participation and weak democratic
decision-making – all leading to an erosion of public trust.
The sugar cooperatives of Maharashtra came under the monopoly of powerful
politicians; giant cooperative institutions in Bihar, formed with noble
intentions, became ghost entities. In northern Kerala, co-operatives were
allegedly controlled by a prominent political party.
Efforts at
Revival
I personally witnessed efforts to revive cooperatives at the grassroots
in the late 1990s. As head of an EEC (now EU) supported project in Bihar, I
helped manage 1,500 Primary Agricultural Cooperatives (PACs) with financial
assistance, elections, training and practical incentives. Each PAC prepared its
own business plan; members received training; and field staff were given
motorcycles instead of costly jeeps to navigate difficult terrain. Gradually,
the PACs began to prosper.
During a visit to one such cooperative Nalanda district, Bihar I saw
first-hand how, with the right support, cooperatives could outperform other
business models. Although set up to support farmers, the PAC provided
everything villagers needed – from pens and notebooks to rice, fertilizers,
pesticides and farm equipment. Unlike the banks they provide an informal
atmosphere and free access. Farmers queued for loans for onion cultivation,
freeing themselves from private moneylenders. They could mortgage surplus
produce, earn a share of the profits, and, buy goods at prices lower than the
market. Because they owned the PAC, they had a stake in its success.
At that time, the cooperative’s share capital exceeded ₹1 crore (about
US$120,000). With leadership, motivation, ownership, financial discipline and
skill-building, cooperatives can thrive. Gandhi’s words rang true: “Without
character there is no co-operation.” In these successes I saw the values of
self-help, self-responsibility, democracy, equality, equity and solidarity he
had championed. The African proverb says it well: “If you want to go fast, go
alone. If you want to go far, go together.”
Self-Supporting
Cooperatives The idea
of enacting legislation on self-supporting cooperatives – free of government
and bureaucratic control – was proposed by the late Dr. Kurien. Key provisions
included deemed registration if approval was delayed beyond 15 days, and
self-financing requirements. Such societies would be on par with any business
enterprise, but managed by their own members. Cooperatives, in this vision,
would fulfil the dream of every village being self-sufficient with a school, a
public health facility and a bank.
A New
Beginning
The 97th Constitutional Amendment Act, 2011 gave constitutional status
to cooperatives in India. In 2021 the Central Government announced the
formation of a separate Ministry of Cooperation to strengthen the movement.
Digitalization of cooperative banks, reform of PACS and updates to multi-state
co-op laws are underway.
With a focus on skill upgradation, livelihoods, financial support and
market access, the PM Vishwakarma scheme aims to support traditional artisans
and craftspeople across India.
I am indeed happy to see that cooperatives in India have now gone beyond
their traditional boundaries to become mediums for innovation and self-reliance
in areas such as digital services, energy and finance. Along with SHGs—Self Help
Groups- of women they can transform life at the bottom level.
Challenges
Ahead
Despite their successes, cooperatives and SHGs face several challenges
like limited access to capital and financial resources; lack of technical and
managerial skills; poor infrastructure and logistical bottlenecks; market
competition and pricing pressures and regulatory and policy constraints. Addressing
these bottlenecks is essential for the movement to achieve its full potential.
A Timely
Reminder – International Year of Cooperatives 2025
On 19 June 2024, the UN General Assembly declared 2025 the International
Year of Cooperatives under the theme “Cooperatives Build a Better World.”
This recognition reaffirms Gandhi’s belief that “individual liberty and
inter-dependence are both essential for life in society.” It offers hope to a
highly individualistic, fragmented and polarised world through mutual
cooperation; people at the grassroots can come together and decide for
themselves how they should live.
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