Perils of the Cooperative Banks in India and the Relevance of Recent Policy Level Interventions

Although cooperative banks have become indispensable for the promotion of rural and farm sector, it is disheartening to note that the cooperative banks do not account for even 20 percent of the share of credit flow to the agriculture sector in India. This clearly shows that cooperative banks have not adequately met the credit requirements of the agriculture sector on the expected lines. It is obvious that at the all India level, only 46.12 percent of Primary Agriculture Credit Societies (PACSs) made profit in 2021. Cooperative bank failures have been reported from many parts of the country. Against this background, the formation of a separate Ministry of Cooperation at the Centre which works on the mantra of “Sahakar se Samriddhi can have far reaching positive effect on the cooperative sector in India.