Primary Agricultural Cooperative Societies-PACS

Organisation, Management and Functions

Dr Daman Prakash, DirectorRURAL MANAGEMENT AND DEVELOPMENT CENTRE,

NEW DELHI. INDIA

PACS are the foundations of

Indian Cooperative Movement and Agriculture

580,000 cooperatives of all types;400 million individual members;

375,000 agricultural cooperatives;280 million farmer-members

Major business:Credit, input, marketing

Agro-processingand Farm Extension

MAJOR SECTORSFoodgrain production & processing, Dairying incl livestock development,

Chemical fertiliser production & distribution, Sugar production & processing,

Oilseeds production & processing,Land & Infrastructure development,

Cotton and Value-addition,largest warehousing system,Cooperative banking system,

and others.

MAJOR PLAYERS[a] Indian Farmers Fertiliser

Cooperative-IFFCO48,000 Member-Cooperatives;

50 million individual farmer-members;5 plants in India; 5 facilities abroad.

Covering 37% of national fertiliser needs. Extensive farm extension services.

[b] Sugar Cooperatives280 Cooperative sugar mills

out of 390 mills;30 million sugarcane grower-members;

Produce 50% of world sugar;Extensive diversification – alcohol, paper manufacture, power-generation, irrigation,

large number of social institutions,strong welfare schemes.

[c] Dairying120,000 primary dairy cooperatives;12 million individual dairy-farmers;

Status: World’s largest milk production;Large producers like “AMUL”;

Wide range of products;45% share of coop Ice-cream;

Animal-care services;Cattle-feed plants;

Extensive marketing network;80% dairy-farmers are women.

[d] Cooperative BankingLT-MT-ST Credit through PACS;

32 State Cooperative Banks;850 District/Sub-district Banks;

1860 Branches;World’s largest agri credit system;

Central financing through NABARD;8% lending rate [2% subsidy by Govt];PACS major users for agri production;Investments in LT & land improvement.

PACS Management Structure is simple and farmer-friendly.

FARMER-MEMBERS [make]GENERAL BODY MEETING [elects]MANAGING COMMITTEE [elects]Chairman, Secretary, Treasurer

Minimum number required is 11;Members buy shares;

Coops observe Principles of Cooperation

PACS raise money from district banks for lending to

members for purchase of farm inputs – fertiliser, seeds,

farm chemicals, farm implements, land improvement, agro-processing,

warehousing etc.

District banks raise money from State Cooperative Banks.

State Banks raise money from NABARD – a government bank

for agriculture and rural development

80-85% PACS loans are used for agricultural production;

PACS are major contributors to national food stock;

PACS are major procurement agents of government for foodgrain

stocks [buffer stock];PACS are major price-stabilisers.

Cooperative Member Education is a major programme to create

awareness and strengthen the system. Member education is done by PACS.

The programme is carried out by National Cooperative Union of India

and State Cooperative Unions.

PACS audit is done by Cooperative Department;

Large cooperatives make use of Chartered Accountants.

AUDIT REPORT + ANNUAL REPORT MUST BE APPROVED BY ANNUAL

GENERAL BODY MEETING.

PROBLEMS FACED BY PACSLow level of Member Participation

[in business and organisation];Shortage of funds for Inputs;

Government controls/interference;Traditional methods of management;

Small in size thus in operations;Political influence.

However,Enlightened members through

member educationtry to strengthen PACS by

generating positive public opinion and influencing the decisions

of government.

CHANGES FOR THE BETTER ARE COMING IN SLOWLY TO IMPROVE COOPERATIVE LEGISLATION AND MAKING THEM COOP

& MEMBER-FRIENDLY.

Members, PACS & Banks have MCL;Loan granted on simple PACS Resolution;

Recovery at the end of the season;All PACS linked with district central

cooperative banks;Concessions in the case of natural

disasters or crop failures;Govt also writes off loans when needed.

ALL EFFORTS ARE TO INCREASE AGRICULTURAL PRODUCTION AND

PRODUCTIVITY

Thank you for your kind attention

Primary Agricultural Cooperative Societies

Organisation, Management and Functions