Content
- New National Cooperative Policy
- Electric Mobility in India: Policy Push and Sustainable Transport Transition
New National Cooperative Policy
Why in News?
- The National Cooperation Policy (NCP), 2025 was launched on 24 July 2025 to provide a long-term strategic roadmap for strengthening India’s cooperative ecosystem across agriculture, banking, marketing, exports, and rural enterprises.
- The policy contains 6 strategic pillars, 16 objectives, and 83 recommendations, aimed at transforming cooperatives into professionally managed, technologically enabled, and economically sustainable institutions over the next decade.
- The policy also encourages States to formulate or reformulate their State Cooperation Policies, ensuring cooperative federalism and coordinated institutional reforms between the Union and State governments.
Relevance
GS Paper II – Governance / Polity
- Policy reforms to strengthen the cooperative sector through National Cooperative Policy 2025.
- Constitutional status of cooperatives under 97th Constitutional Amendment Act.
- Legal framework governing cooperatives under Multi-State Cooperative Societies Act (amended 2023).
- Cooperative federalism: role of Centre and States in regulating cooperatives (State List).
GS Paper III – Economy / Agriculture
- Role of cooperatives in agricultural marketing, rural credit, dairy, fisheries and rural enterprises.
- Strengthening Primary Agricultural Credit Societies (PACS) and cooperative banking networks.
- Expanding agricultural value chains through storage, processing and exports.
Practice Question
- The cooperative movement has played a crucial role in India’s rural economy. Examine how the National Cooperative Policy 2025 aims to revitalise the cooperative sector while addressing structural challenges in governance and competitiveness. (250 words)
What is the Cooperative Movement?
Concept and Nature
- Cooperatives are voluntary, member-owned, and democratically governed economic institutions, formed to collectively meet economic, social, and cultural needs through shared ownership, mutual assistance, and equitable distribution of benefits.
Core Principles of Cooperatives
- The cooperative movement globally follows principles such as voluntary membership, democratic governance, economic participation, autonomy, cooperation among cooperatives, and commitment to community development and social welfare.
Global Recognition
- The United Nations declared 2025 as the International Year of Cooperatives, recognising their role in promoting sustainable development, poverty reduction, employment generation, and inclusive economic growth across developing economies.
Cooperative Sector in India
- India hosts approximately 8.4 lakh cooperative societies across nearly 30 sectors, involving around 32 crore members, making it one of the world’s largest cooperative ecosystems.
National Cooperation Policy (NCP) 2025
Vision
- The policy envisions a vibrant, transparent, professionally managed and technology-driven cooperative ecosystem capable of delivering inclusive growth, strengthening rural livelihoods, and promoting grassroots economic democracy.
Mission
- To transform cooperatives into self-sustaining economic institutions, capable of competing in modern markets while retaining their social objectives of equitable development and collective prosperity.
Strategic Pillars of the Policy
1. Strengthening the Foundation
- The policy aims to strengthen the institutional and governance foundations of the cooperative sector by promoting professional management, transparent audit systems, improved regulatory frameworks, and stronger grassroots cooperative institutions.
2. Promoting Vibrancy
- Focuses on creating financially sustainable cooperatives with diversified economic activities, encouraging innovation, improved market access, and enhanced value addition across agriculture, dairy, fisheries, and rural enterprises.
3. Making Cooperatives Future Ready
- Encourages digital transformation, enterprise modernization, and adoption of technology platforms, enabling cooperatives to compete in contemporary markets and improve efficiency, transparency, and service delivery.
4. Promoting Inclusivity and Expanding Reach
- Expands cooperative coverage across rural, tribal, and underserved regions, enabling marginalized communities, small farmers, women, and youth to participate in cooperative enterprises.
5. Entering New and Emerging Sectors
- Encourages cooperatives to expand into organic agriculture, exports, renewable energy, digital services, and emerging rural enterprises, thereby diversifying income sources and strengthening rural economic resilience.
6. Shaping the Young Generation
- Promotes cooperative education and training programmes to inspire youth participation, entrepreneurship, and leadership within the cooperative movement, ensuring long-term sustainability and institutional renewal.
Key Initiatives Supporting the Policy
Strengthening Primary Agricultural Credit Societies (PACS)
- The government introduced Model Bye-laws for PACS, allowing them to undertake more than 25 economic activities, thereby transforming them into multipurpose rural institutions providing financial, agricultural, and service-based functions.
- A nationwide PACS computerization project worth ₹2925 crore aims to digitize cooperative operations through ERP-based software integration with NABARD, State Cooperative Banks, and District Central Cooperative Banks.
- Over 79,630 PACS have been sanctioned under the computerization programme, with more than 61,000 PACS already onboarded, significantly improving transparency, governance, and service delivery at the grassroots level.
Expansion of Cooperative Infrastructure
Multipurpose Cooperatives in Every Panchayat
- A national plan aims to establish multipurpose PACS, dairy cooperatives, and fisheries cooperatives in all Panchayats, expanding grassroots cooperative coverage and enabling farmers to access credit, inputs, and market linkages locally.
Progress So Far
- Around 32,802 new PACS, dairy and fishery cooperatives have been registered, while 15,793 existing cooperatives have been strengthened, expanding the cooperative footprint across rural India.
World’s Largest Grain Storage Plan
- The government launched the World’s Largest Grain Storage Plan in the cooperative sector, aimed at building warehouses, processing units, and custom hiring centres at PACS level to reduce post-harvest losses.
- The plan integrates multiple schemes such as Agriculture Infrastructure Fund, Agricultural Marketing Infrastructure Scheme, PMFME, and Sub Mission on Agricultural Mechanization to strengthen local agricultural value chains.
- Under pilot implementation, warehouse construction has begun across multiple states, enabling farmers to store produce locally, reduce transportation costs, and secure better market prices.
Strengthening Cooperative Banking
- Several regulatory reforms have been introduced to strengthen cooperative banks, including branch expansion, enhanced lending limits, reduced compliance burdens, and improved regulatory oversight by the Reserve Bank of India.
- Cooperative banks have been integrated into the RBI Integrated Ombudsman Scheme, ensuring improved transparency, customer grievance redressal, and greater accountability in cooperative financial institutions.
- Priority sector lending norms and exposure limits have been relaxed, enabling cooperative banks to expand housing loans, SME lending, and rural credit delivery.
New National Cooperative Institutions
National Cooperative Export Limited (NCEL)
- NCEL promotes exports of cooperative products globally, enabling Indian farmers and producers to access international markets through aggregation, branding, certification, logistics, and export facilitation.
National Cooperative Organics Limited (NCOL)
- NCOL supports organic farming, certification, processing, and marketing, launching the “Bharat Organics” brand, thereby promoting sustainable agriculture and value-added organic products.
Bharatiya Beej Sahakari Samiti Limited (BBSSL)
- BBSSL focuses on production, certification, storage, and distribution of quality seeds, strengthening agricultural productivity and improving farmers’ access to certified seeds under the “Bharat Beej” brand.
Sectoral Cooperative Initiatives
Dairy Sector – White Revolution 2.0
- The programme aims to increase milk procurement by cooperative dairy institutions by 50% within five years, expanding dairy infrastructure, employment opportunities, and farmer incomes across rural India.
Fisheries Cooperatives
- Fish Farmer Producer Organisations (FFPOs) are being developed to strengthen market linkages, processing facilities, and export opportunities for small-scale fisheries cooperatives.
Sugar Cooperatives
- A ₹10,000 crore financial assistance programme supports cooperative sugar mills for ethanol production, cogeneration plants, and modernization, aligning the cooperative sugar sector with the ethanol blending programme.
Education and Capacity Building
Tribhuvan Sahkari University
- The government established Tribhuvan Sahkari University by converting the Institute of Rural Management Anand, providing specialized education and research in cooperative management, rural finance, and agribusiness development.
Cooperative Education in Schools
- The NCERT curriculum now includes cooperative awareness modules for school students, aiming to build early awareness and encourage youth participation in the cooperative movement.
Digital Transformation and Market Integration
National Cooperative Database
- The government created a National Cooperative Database containing information on approximately 8.4 lakh cooperative societies, enabling better policy planning, monitoring, and evidence-based decision-making.
Cooperative Ranking Framework
- A cooperative ranking framework evaluates societies based on governance standards, financial performance, operational efficiency, and infrastructure development, promoting competitiveness and transparency.
Digital Market Access
- Partnerships with digital platforms such as Swiggy Instamart aim to enhance market access for cooperative products including dairy, organic foods, millets, and handicrafts.
Constitutional and Legal Framework
Constitutional Recognition
- The 97th Constitutional Amendment Act, 2011 recognized the importance of cooperatives by making the right to form cooperative societies a fundamental right under Article 19.
- It introduced Article 43B in the Directive Principles, encouraging the State to promote voluntary formation, democratic functioning, and professional management of cooperative societies.
Legal Framework
- The Multi-State Cooperative Societies Act, 2002, amended in 2023, strengthens governance mechanisms by introducing provisions for cooperative ombudsman, transparent elections, and improved accountability frameworks.
Challenges in the Cooperative Sector
Governance Deficits
- Many cooperatives continue to face political interference, weak democratic functioning, and inadequate professional management, undermining institutional efficiency and eroding member confidence.
Financial Weakness
- Several cooperative banks and societies suffer from low capitalisation, rising non-performing assets, and weak financial discipline, limiting their ability to compete with private sector financial institutions.
Federal Coordination Issues
- Since cooperatives fall under the State List, regulatory frameworks vary across states, creating fragmentation and inconsistencies in policy implementation and governance standards.
Technological Backwardness
- A large number of cooperatives lack modern digital infrastructure, fintech integration, and data management capabilities, restricting their operational efficiency and access to emerging digital markets.
Market Competitiveness
- Cooperatives often struggle to compete with corporate agribusinesses, multinational retailers, and private financial institutions, particularly in sectors requiring scale, logistics networks, and advanced technology.
Way Forward
Professionalisation of Cooperative Management
- Strengthen governance through independent audits, professional managers, transparent elections, and capacity-building programmes to ensure accountability and operational efficiency.
Digital Transformation
- Accelerate digitisation of cooperative societies, integration with fintech platforms, and adoption of data-driven management systems, enabling better service delivery and market access.
Strengthening Value Chains
- Promote cooperative participation across the entire agricultural value chain including production, processing, storage, logistics, marketing, and exports.
Financial Strengthening
- Expand institutional financing through NABARD, NCDC, cooperative banks, and credit guarantee mechanisms, ensuring greater credit availability for cooperative enterprises.
Youth Engagement and Entrepreneurship
- Encourage youth participation through cooperative education, internships, entrepreneurship programmes, and university-level training in cooperative management and rural enterprises.
Conclusion
- The National Cooperation Policy 2025 represents a comprehensive effort to revitalise India’s cooperative movement by strengthening governance, expanding digital infrastructure, and integrating cooperatives into modern agricultural and rural value chains.
- If effectively implemented with strong federal coordination and institutional reforms, the policy can transform cooperatives into powerful instruments of inclusive development, rural entrepreneurship, and grassroots economic democracy, contributing significantly to India’s vision of Viksit Bharat 2047.
Electric Mobility in India: Policy Push and Sustainable Transport Transition
Why in News?
- The government highlighted the year-on-year growth of electric vehicle adoption between FY 2019-20(1.74 Lakhs) and FY 2024-25(19.68 Lakhs), reflecting a rapid expansion of India’s electric mobility ecosystem.
- Several schemes have been introduced to strengthen domestic EV manufacturing, battery supply chains, and charging infrastructure, supporting India’s transition toward sustainable transport systems.
- Progress under the PM e-Bus Sewa–Payment Security Mechanism (PSM) Scheme shows increasing deployment of electric buses in urban public transport systems.
Relevance
GS Paper III – Environment / Climate Change
- Electric vehicles as a key tool for reducing greenhouse gas emissions and urban air pollution.
- Supports India’s commitments under the Paris Agreement and long-term decarbonisation goals.
GS Paper II – Governance
- Government initiatives promoting EV adoption including
- PM E-DRIVE Scheme
- PM e-Bus Sewa – Payment Security Mechanism Scheme.
GS Paper III – Infrastructure / Science & Technology
- Expansion of EV charging infrastructure and grid integration.
- Development of advanced battery technologies and rare earth magnet manufacturing.
Practice Question
- Electric vehicles are central to India’s clean energy transition. Discuss the policy measures taken by the government to promote electric mobility and examine the challenges in building a sustainable EV ecosystem. (250 words)
What are Electric Vehicles (EVs)?
Definition
- Electric Vehicles are automobiles powered primarily by electric motors using energy stored in rechargeable batteries, replacing internal combustion engines that rely on petrol or diesel.
Major Types of EVs
- Battery Electric Vehicles (BEVs) operate entirely on electric batteries without internal combustion engines, producing zero tailpipe emissions and requiring charging through grid-connected charging infrastructure.
- Hybrid Electric Vehicles (HEVs) combine internal combustion engines with electric motors, improving fuel efficiency but still relying partially on fossil fuels.
- Plug-in Hybrid Electric Vehicles (PHEVs) combine electric propulsion with conventional engines but can be externally charged using electricity.
Importance in Climate Strategy
- EVs reduce greenhouse gas emissions, urban air pollution, and fossil fuel dependency, thereby supporting India’s commitments under the Paris Agreement and long-term energy transition goals.
Growth of Electric Vehicles in India
Rising EV Adoption
- India has witnessed significant growth in EV adoption since FY 2019-20, driven by government incentives, rising fuel prices, and increasing consumer awareness about sustainable mobility options.
Sectoral Distribution
- EV adoption is particularly strong in two-wheelers and three-wheelers, which dominate India’s transport ecosystem and offer faster electrification due to lower battery costs and shorter travel distances.
Urban Transport Electrification
- Electric buses are increasingly being deployed in urban public transport systems to reduce pollution, improve energy efficiency, and support sustainable city mobility frameworks.
Government Initiatives for Electric Mobility
Production Linked Incentive Scheme for Automobile Sector (PLI-Auto)
- The PLI-Auto Scheme, approved in September 2021 with an outlay of ₹25,938 crore, aims to boost domestic manufacturing of advanced automotive technologies and strengthen India’s position in global EV supply chains.
- The scheme provides financial incentives for manufacturers achieving at least 50% Domestic Value Addition, encouraging investment in EV components, advanced vehicle technologies, and modern automotive manufacturing facilities.
PLI Scheme for Advanced Chemistry Cell (ACC) Battery Storage
- Approved in May 2021 with a budgetary outlay of ₹18,100 crore, this scheme aims to establish a 50 GWh domestic battery manufacturing capacity to support India’s electric mobility transition.
- Domestic production of ACC batteries is crucial to reduce import dependence, strengthen supply chain resilience, and lower EV manufacturing costs in India.
PM Electric Drive Revolution in Innovative Vehicle Enhancement (PM E-DRIVE)
- The PM E-DRIVE Scheme, launched in September 2024 with an outlay of ₹10,900 crore, incentivizes the adoption of electric two-wheelers, three-wheelers, trucks, ambulances, and buses.
- The scheme also supports charging infrastructure development, vehicle testing facilities, and domestic manufacturing through the Phased Manufacturing Programme (PMP).
Rare Earth Permanent Magnet Manufacturing Scheme (REPM)
- The REPM Scheme, launched in December 2025 with a financial outlay of ₹7,280 crore, aims to develop 6,000 metric tons annual capacity for rare earth permanent magnet manufacturing in India.
- Rare earth magnets are critical components in electric motors and EV drivetrains, and domestic production will reduce dependence on global supply chains.
Scheme for Promotion of Manufacturing of Electric Passenger Cars (SPMEPCI)
- This scheme encourages global and domestic manufacturers to invest at least ₹4,150 crore in EV manufacturing, while ensuring progressive domestic value addition in production.
- Manufacturers must achieve 25% domestic value addition within three years and 50% within five years, promoting indigenous EV manufacturing capabilities.
PM e-Bus Sewa – Payment Security Mechanism (PSM) Scheme
Objective
- The scheme aims to deploy more than 38,000 electric buses across India’s public transport networks while providing payment security to operators against defaults by public transport authorities.
Financial Outlay
- The scheme has an outlay of ₹3,435 crore, ensuring reliable financing mechanisms for large-scale electric bus deployment.
Implementation Mechanism
- Convergence Energy Services Limited (CESL) acts as the central implementing agency responsible for aggregating e-bus demand, managing payment security funds, and verifying operator payment claims.
Implementation Progress
- Tenders for 6,228 electric buses have been concluded, while letters of award have been issued for 4,720 buses by public transport authorities.
- A ₹500 crore Payment Security Fund has been established to ensure timely payments to bus operators under the scheme.
State Participation
- 19 States and Union Territories have submitted Direct Debit Mandates to the Reserve Bank of India, ensuring financial commitments for e-bus operations under the scheme.
Importance of Electric Vehicles
Environmental Benefits
- EV adoption significantly reduces urban air pollution, greenhouse gas emissions, and dependence on fossil fuels, contributing to improved environmental sustainability and climate mitigation efforts.
Energy Security
- EV adoption reduces India’s dependence on imported crude oil, thereby improving energy security and reducing vulnerability to global energy price fluctuations.
Industrial Growth
- Expansion of EV manufacturing and battery supply chains creates new industrial ecosystems, employment opportunities, and technological innovation in advanced automotive manufacturing.
Urban Sustainability
- Electrification of public transport through electric buses improves urban mobility efficiency, reduces noise pollution, and enhances public transport sustainability.
Challenges in EV Adoption
High Upfront Cost
- Electric vehicles remain more expensive than conventional vehicles, primarily due to the high cost of lithium-ion batteries and limited economies of scale in domestic production.
Battery Supply Chain Dependency
- India remains dependent on imports for critical minerals such as lithium, cobalt, and nickel, exposing the EV sector to global supply chain disruptions.
Charging Infrastructure Gaps
- Insufficient charging stations across highways, urban centers, and rural areas limit consumer confidence and restrict large-scale EV adoption.
Grid and Energy Challenges
- Large-scale EV adoption will significantly increase electricity demand, requiring grid modernization, renewable energy integration, and smart charging systems.
Technological Dependence
- Limited domestic technological capabilities in battery chemistry, power electronics, and rare earth processing constrain India’s EV manufacturing competitiveness.
Way Forward
Strengthening Battery Ecosystem
- Accelerate domestic manufacturing of advanced battery technologies, recycling infrastructure, and critical mineral supply chains to reduce import dependence.
Expanding Charging Infrastructure
- Develop a nationwide EV charging network along highways, urban centres, and rural regions, supported by public-private partnerships and smart grid technologies.
Promoting Public Transport Electrification
- Prioritize electrification of buses, taxis, and last-mile mobility services, as these segments provide the highest emission reduction potential.
Supporting Research and Innovation
- Invest in next-generation battery technologies, hydrogen mobility, and advanced power electronics, enabling India to become a global hub for clean mobility innovation.
Strengthening Policy Coordination
- Ensure coordination between industrial policy, climate policy, and urban mobility planning to accelerate India’s transition toward a sustainable transport ecosystem.
Conclusion
- Electric vehicles represent a transformative opportunity for India to simultaneously achieve energy security, climate mitigation, and industrial growth.
- Through strategic initiatives such as PLI schemes, PM E-DRIVE, and PM e-Bus Sewa, India is building a comprehensive EV ecosystem encompassing manufacturing, infrastructure, and sustainable mobility.
- Sustained investments in technology, infrastructure, and domestic supply chains will be critical for positioning India as a global leader in electric mobility while advancing its net-zero ambitions.
