Describe the advantages of cooperative system. Explain the Anand pattern of cooperative societies

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Answer:

Advantages of Cooperative System

The cooperative system is a form of voluntary organization where people with common interests come together to promote their economic, social, and cultural welfare. In the Indian context, cooperative societies play a vital role in sectors like agriculture, dairy, credit, housing, and marketing. Here are the key advantages:

1. Voluntary and Open Membership

  • Membership in a cooperative society is open to all people who share a common objective, irrespective of caste, religion, gender, or economic status.
  • No discrimination is practiced, which promotes inclusive growth and social unity.

2. Democratic Management

  • Cooperatives operate on the principle of “One member, one vote”, regardless of the number of shares held.
  • This ensures equality in decision-making and prevents the concentration of power.

3. Limited Liability

  • The liability of members is limited to the extent of their capital contribution.
  • This protects members’ personal assets and encourages participation from economically weaker sections.

4. Promotion of Thrift and Self-Help

  • Cooperatives encourage saving and self-reliance among members.
  • They operate on the philosophy of mutual aid, rather than profit maximization.

5. Elimination of Middlemen

  • In sectors like agriculture and dairy, cooperatives help farmers sell directly to consumers or processors.
  • This results in better price realization for producers and lower prices for consumers.

6. Access to Credit

  • Cooperative credit societies provide loans to small farmers, artisans, and laborers at low interest rates.
  • This helps in protecting them from moneylenders and exploitative financial practices.

7. Government Support

  • The Indian government supports cooperatives through grants, subsidies, and training programmes.
  • Cooperatives also enjoy tax exemptions and priority lending status from banks.

8. Employment Generation

  • Cooperatives create employment opportunities both directly and indirectly.
  • They offer rural employment through agro-processing, dairy, and farming cooperatives.

9. Equitable Distribution of Surplus

  • Surplus earnings of a cooperative society are distributed fairly among members or reinvested for community development.

10. Socio-Economic Development

  • Cooperatives contribute to rural development, poverty reduction, and empowerment of marginalized sections, especially women and small farmers.

Anand Pattern of Cooperative Societies

The Anand Pattern is a unique and highly successful model of dairy cooperative movement developed in Anand district of Gujarat. It was pioneered by Dr. Verghese Kurien, who is known as the Father of the White Revolution in India.

Key Features of the Anand Pattern:

  1. Three-Tier Structure:
    • The Anand pattern has a three-tier cooperative structure:
      • Village Level: Primary Dairy Cooperative Societies (DCS)
      • District Level: District Milk Union (like AMUL)
      • State Level: State Federation (like GCMMF – Gujarat Cooperative Milk Marketing Federation)
  2. Farmer-Owned and Farmer-Controlled:
    • The entire structure is owned and managed by farmers.
    • The profits go directly to the dairy farmers, not to any private company or middleman.
  3. Professional Management:
    • Though controlled by farmers, the Anand pattern integrates professional managers and technocrats to ensure efficiency, quality, and innovation.
  4. Direct Procurement from Farmers:
    • Milk is collected directly from farmers at the village level.
    • This ensures that farmers get the entire sale price, unlike in traditional systems with intermediaries.
  5. Daily Payments:
    • Farmers are paid daily or weekly, ensuring cash flow and financial stability for rural households.
  6. Technical Support:
    • Dairy cooperatives provide members with veterinary services, cattle feed, breeding services, and training for better productivity.
  7. Value Addition and Marketing:
    • Milk is processed into butter, cheese, ghee, paneer, curd, ice-cream, etc.
    • These products are branded and sold under popular names like AMUL, ensuring wider reach and better prices.
  8. Replicable Model:
    • The Anand pattern became the foundation for Operation Flood, launched by the National Dairy Development Board (NDDB), which helped replicate the model across India.

Impact of the Anand Pattern:

  • Boosted milk production and made India the world’s largest milk producer.
  • Raised farmers’ incomes and improved nutrition across the country.
  • Empowered rural women and helped build self-sustaining rural economies.
  • Created an efficient, transparent supply chain with minimal wastage.

Conclusion

The cooperative system, particularly the Anand Pattern, has transformed rural India by empowering farmers, promoting equitable growth, and ensuring food security. It is a grassroots movement built on the principles of democracy, equality, and cooperation. In the Indian context, where agriculture and allied sectors form the backbone of the economy, the cooperative model continues to be a powerful instrument for rural development and poverty alleviation.

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