Dr Kritika Rana
Recently, the Ministry of Cooperation has released a draft of the model bylaws for PACS (Primary Agricultural Credit Societies), wherein the PACS will be allowed to expand and diversify their businesses. A Primary Agricultural Credit Society (PACS) works at the grass-root level with gram Panchayats in villages. It aims at uplifting the lives of approximately 13 crore Small and Marginal Farmers (SMF) by providing them with short-term and medium-term credit facility along with providing essential agricultural supplies and marketing services. The PACS do not stop at these, but also fulfils basic domestic requirements of its members by providing sugar, kerosene, grains, etc. But these commercial activities of PACS are constrained by the relevant bylaws, many of which are decades old and require revision and because of this, PACS cannot continue to run profitably by earning income from these limited sources.
Thus, in order to address this issue and to transform the 95000 PACS across India into vibrant economic entities, the Ministry of Cooperation under the leadership of Home Minister Amit Shah constituted a committee with representatives from NABARD, State Cooperative Banks, Vaikunth Mehta National Institute of Co-operative Management (VAMNICOM), National Council for Cooperative Training (NCCT), among others to prepare and upgrade the bylaws for PACS. These updated bylaws, also known as model bylaws, will focus on converting the present style PACS into Multi-Purpose Primary Agricultural Credit Societies or Bahu-Uddeshiye PACS by enabling them to diversify and branch out their businesses into more than 25 sectors such as such as extending credit facility (short, medium and long term); distributing fertilizers, pesticides, seeds, etc., providing farm machinery and equipment; custom hiring centres; floriculture; setting up of hospitals, education sector, LPG/petrol/diesel dealership, Bank Mitra or business correspondence, insurance facility, data centre, locker facility, etc. to name a few.
Along with this, the Cabinet under the leadership of Prime Minister Narendra Modi has approved the setting up of multi-state cooperative seed society, hereby known as Bharatiya Sahakari Beej Samiti Ltd (BSBS), under the Multi-State Cooperatives Act, 2002. This society will play a major role in sustainable agricultural growth and global food security by preserving and providing quality seeds to the farmers. All agronomic techniques and other inputs used on the crop will be rendered useless if low-quality seeds are used. All cooperative societies are eligible to join and have their elected representatives serve on the board of BSBS. A system for the preservation and promotion of indigenous natural seeds will be developed, and the national level multi-state seed cooperative society will serve as the central organisation for production, procurement, processing, branding, labeling, packaging, storage, marketing, and distribution of high-quality seeds.
The annual seed requirement is for 787 lakh quintals, out of these only 372 lakh quintals is supplied by organised sector. Remaining 415 lakh quintal is in the unorganised sector, which comes from the farmers themselves. However, large amounts of this go to waste as they are unable to reach the deprived farmers on time. Having said that, the present Rs. 40,000-crore seed market in India is largely dominated by the private sector where the farmers are majorly exploited.
To overcome this monopoly, the Bharatiya Sahakari Beej Samiti (BSBS) aims at utilising the network of all levels of cooperatives to ensure the role of farmers in the production and distribution of certified seeds under a single brand name. This direct contribution of quality seeds alone will increase the production by 15-20 per cent. The government also wants to increase the percentage of cropped area covered with quality seeds, expressed in terms of Seed Replacement Rate (SRR). For self-pollinated crops, the recommended SRR norms are 33 per cent; for cross-pollinated crops, 50 per cent; and for hybrids, 100 per cent. It is advised that the states should stick to these norms. Along with this, the BSBS will help in reducing the yield gaps by promoting Varietal Replacement Rate (VRR), thereby, enhancing productivity.
The setting up of BSBS will also help the government in capturing the organic food market which is rapidly growing due to rising health and environmental consciousness. However, despite having the largest no. of organic growers worldwide (16 lakh out of total 34 lakh), India’s contribution to the market for organic products is only 2.7 per cent. This marginal contribution is due to smaller per-capita land holdings and insufficient output. This problem is further reinvigorated because of lack of institutional support: testing and certification facilities in the vicinity; insufficient logistical infrastructure; dispersed and fragmented producer base; lack of knowledge repository; insufficient innovative research & development; lack of concerted efforts to replicate successful organic farming models across all of India, and lack of identification & development facilities. These issues are making India lag behind despite having 4th largest organic landholdings.
In the wake of the above challenges, the Cabinet has further approved the setting up of a multi-state Cooperative Organic Society under the same MSCS Act, 2002, to serve as an umbrella organization for organic products. The proposed society besides offering institutional supports will also arrange financial assistance for the organic farmers through its member cooperatives, including Primary Agricultural Credit Societies (PACS)/Farmers Producer Organizations (FPOs). It will also take on all promotion and development-related activities for organic farming. In order to lower the cost of testing and certification, it will appoint recognised organic testing labs and certification bodies that will adhere to the society’s requirements. In other words, through its member cooperatives, this society will oversee the whole supply chain of organic products made by cooperatives and affiliated organisations. It will further use the brand and marketing networks of AMUL and other companies on a fee-for-service basis to adopt different business models, and it will simultaneously build the same on its own. To support all these initiatives, the society will have an authorized capital of Rs 500 crore with initial paid-up capital of Rs 100 crore.
Thus, this triple-pronged strategy in the form of Bahu-Uddeshiye PACS, BSBS and Cooperative Organic Society will help the Prime Minister in realizing his dream of making India Atmanirbhar through the inclusive growth model and contributing towards the achievement of ‘Sahakar-se-Samriddhi’ objective.
(The author is faculty, RICM-Chandigarh).
