As per National Cooperative Database, 33,853 new M-PACS, Dairy and Fishery Cooperative Societies have been registered; and 21,292 Dairy and Fisheries Cooperative Societies have been strengthened till Manthan Baithak organized in February, 2026. Model State Cooperative Act has not been formulated, so far. A series of initiatives have been undertaken by the Ministry in furtherance of the objectives of the NCP, 2025, many of which were initiated even prior to the formal launch of the policy. The detailed list of these initiatives is enclosed at Annexure . An Implementation Cell and a Policy Implementation and Monitoring Committee have been constituted under the NCP, 2025. States have been actively engaged in the smooth and timely implementation of the Ministry’s initiatives. Monthly meetings are through video conferencing with the States/UTs to review the progress of initiatives undertaken by the Ministry of Cooperation. In addition, quarterly review meetings are conducted in physical mode with the Principal Secretaries/Secretaries of the Cooperative Departments of the States and the Registrars of Cooperative Societies of the States/UTs. Recently, the ‘Manthan Baithak’ was held on 17 th February 2026 under the chairmanship of the Union Home and Cooperation Minister, with the participation of the Cooperation Ministers of States/UTs. The NCP, 2025 has six strategic pillars, one of which promotes inclusivity and deepening reach to ensure greater participation of all sections of society in the cooperative movement. Key provisions under the policy include: Encourage the participation of women, youth, small & marginal farmers, and weaker sections (SC/ST, specially-abled, etc.) to foster inclusivity and assign them significant roles in cooperatives. Strengthen and promote cooperatives for the weaker and marginalized sections in sectors like fisheries, dairy, handloom weaving, handicrafts, minor forest produce, etc. Support the development of disaggregated data on gender, weaker sections, etc., recommending its inclusion in the NCD for targeted interventions. Further, the Ministry of Cooperation has launched Cooperative-led White Revolution 2.0 to expand cooperative coverage in the dairy sector, generate employment and empower women. The initiative aims to increase milk procurement of dairy cooperatives by 50% over the next five years. ***** Annexure Initiatives Taken by the Ministry of Cooperation Ministry of Cooperation, since its inception on 6 th July, 2021, has undertaken several initiatives to realize the vision of “Sahakar-se-Samriddhi” and to strengthen & deepen the cooperative movement from Primary to apex-level Cooperatives in the country. The list of initiatives taken, including progress made so far is as follows: Making Primary Cooperatives economically vibrant and transparent Model Bye-Laws for Primary Agriculture Credit Societies (PACS), making them multipurpose, multidimensional, and transparent entities : Government, in consultation with all the stakeholders, including States/ UTs, National Level Federations, State Cooperative Banks (StCBs), District Central Cooperative Banks (DCCBs), etc., has prepared and circulated Model Bye-laws for PACS to all the States/ UTs, which enable PACS to undertake more than 25 business activities, improve governance, transparency, and accountability in their operations. Provisions have also been made to make the membership of PACS more inclusive and broad-based, giving adequate representation to women and the Scheduled Castes/Scheduled Tribes. So far, 32 States/ UTs have adopted Model Bye-laws or their existing bye-laws are in line with Model Bye-laws. Strengthening of PACS through Computerization : To strengthen PACS, a project for the Computerization of functional PACS with a total financial outlay of ₹2925.39 Crore has been approved by the Government of India, which entails bringing all functional PACS in the Country onto a common ERP-based national software, linking them with National Bank for Agriculture and Rural Development (NABARD) through StCBs and DCCBs. A total of 79,630 PACS from 31 States/ UTs have been sanctioned under the project. A total of 61,025 PACS have been onboarded on Enterprise Resource Planning (ERP) Software, and hardware has been procured by 30 States/UTs. Establishing New Multipurpose PACS/ Dairy/ Fishery Cooperatives to cover all the Panchayats : The Government of India has approved the plan to establish new multipurpose PACS/dairy/fisheries cooperatives, aiming to cover all panchayats and villages in the country over the next five years. This initiative is supported by NABARD, National Dairy Development Board (NDDB), National Fisheries Development Board (NFDB), and State/UT Governments. As per the National Cooperative Database, a total of 32,802 new PACS, Dairy and Fishery Cooperative Societies have been registered; and 15,793 Dairy and Fisheries Cooperative Societies have been strengthened as on 20.01.2026 across the country since the approval of the plan on 15.2.2023. Launch of Margdarshika/ SOP for Establishing New Multipurpose PACS/ Dairy/ Fishery Cooperatives in covering all the Panchayats: To ensure effective and timely implementation of the plan, the Ministry of Cooperation, in coordination with NABARD, NDDB, and NFDB, has launched a Standard Operating Procedure (Margdarshika) on 19.9.2024, indicating the targets and timelines for all stakeholders concerned World’s Largest Decentralized Grain Storage Plan in the Cooperative Sector : Government has approved a plan to create warehouses, custom hiring centers, primary processing units and other agri-infrastructure for grain storage at PACS level, through convergence of various Government of India (GOI) schemes, including Agriculture Infrastructure Fund (AIF), Agricultural Marketing Infrastructure Scheme (AMI), Sub Mission on Agricultural Mechanization (SMAM), Pradhan Mantri Formalization of Micro Food Processing Enterprises Scheme (PMFME), etc. This will reduce wastage of food grains and transportation costs, enable farmers to realize better prices for their produce and meet various agricultural needs at the PACS level itself. Under the pilot project, construction of godowns in 11 PACS of 11 States has been completed. Further, under the Extended Pilot, more than 500 PACS across the country have been identified for the construction of godowns under the World’s Largest Grain Storage Plan in the Cooperative Sector. Currently, the State Department of Food and Civil Supplies, National Agricultural Cooperative Marketing Federation of India Ltd. (NAFED), and National Cooperative Consumers Federation of India Limited (NCCF) have given hiring assurance for godowns to be constructed in 287 PACS, and construction work has commenced in 208 PACS, out of which construction completed in 109 PACS (Rajasthan. -90, Maharashtra- 15 and Gujarat - 4) Launch of Margdarshika/ SOP for World’s Largest Grain Storage Plan in Cooperative Sector : A comprehensive Standard Operating Procedure (SOP) - “Margdarshika” has been developed and shared with the States/ UTs for the smooth and uniform implementation of the Plan. The Margdarshika includes: formation of various committees under the scheme, decisions taken in the Inter-Ministerial Committee (IMC), introduction and benefits of various converged schemes under the plan, application procedure, phase-wise implementation flowchart of the grain storage project, expected outcomes and defined timelines, roles and responsibilities of the Ministry of Cooperation and other stakeholders, Warehousing Development and Regulatory Authority (WDRA) guidelines for the construction of godowns, criteria for the selection of PACS under the scheme. Amendments made under AMI Scheme with regard to World’s Largest Grain Storage Plan: Based on the decisions taken in the 2nd IMC meeting of World’s Largest Grain Storage Plan in the Cooperative Sector, held on 23.10.2024, the Department of Agriculture and Farmers Welfare has made the following amendments under the AMI scheme: To enhance the financial viability of the scheme, the margin money requirement has been reduced from 20% to 10%. The construction cost has been revised from ₹3000–3500/MT to ₹6000 - 7000/MT for plain areas and from ₹4000/MT to ₹8000/MT for northeastern states. The subsidy has been increased from 25% to 33.33% (from ₹875/MT to ₹2333/MT for plain areas and from ₹1333.33/MT to ₹2666/MT for northeastern states). For PACS, a provision has been made to provide an additional subsidy of 1/3 (one third) of the total admissible subsidy for ancillary infrastructure such as internal roads, weighbridges, boundary walls, etc. Developments pertaining to FCI regarding identification and issuance of Hiring Assurance to Godowns under the World’s Largest Grain Storage Plan in the Cooperative Sector: Based on the decisions taken in the meeting held on 2.6.2025 under the chairmanship of Hon’ble Home and Cooperation Minister, Food Corporation of India (FCI) has been entrusted to identify PACS, provide hiring assurance, and ensure the annual hiring of these warehouses. The following progress has been made: In Phase I, FCI has identified 216 potential locations for hiring of godowns of 2500 MT and above (1671 MT and above for North Eastern and Hilly areas) About 26.03 LMT Storage requirement has been mapped by FCI in these potential 216 locations in 18 States /UTs. States have identified 173 PACS/Cooperative Societies and are actively identifying additional PACS/Cooperative Societies PACS as Common Service Centers (CSCs) for better access to e-services : An MoU has been signed between the Ministry of Cooperation, the Ministry of Electronics and Information Technology (MeitY), NABARD, and CSC e-Governance Services India Limited for providing more than 300 e-services such as banking, insurance, Aadhar enrolment/ updation, health services, PAN card, and IRCTC/ Bus/ Air ticket, etc., through PACS. So far, 52,018 PACS have started providing CSC services to rural citizens. Formation of new Farmer Producer Organizations (FPOs) by PACS: Under the Central Sector Scheme - Formation and Promotion of 10,000 Farmer Producer Organizations (FPOs), National Cooperative Development Corporation (NCDC) is one of the Implementing Agencies designated by the Department of Agriculture and Farmers Welfare (DA&FW), Ministry of Agriculture and Farmers Welfare, Government of India, towards the formation and promotion of FPOs under the Cooperative Societies Act. The target for the formation and promotion of 746 FPOs was assigned by DA&FW to NCDC, and NCDC registered 746 FPOs in the cooperative sector. Thereafter, with the initiative of Ministry of Cooperation, Government of India, additional target of Farmer Producer Organizations (FPOs) was allocated to NCDC by Ministry of Agriculture and Farmers Welfare, GoI, for formation and promotion of FPOs in cooperative sector through strengthening of PACS under the scheme and NCDC got target of 1117 FPOs and registered/onboarded 1117 FPOs through the members of PACS. This will help provide farmers with necessary market linkages and a fair and remunerative process for their produce. NCDC has disbursed ₹245 crore to FPOs/Cluster-Based Business Organizations (CBBOs) under the scheme as of 15.01.2026. PACS given priority for Retail Petrol/ Diesel outlets : The Government has allowed PACS to be included in the Combined Category 2 (CC2) for allotment of retail petrol/ diesel outlets. As per information received from Oil Marketing Companies (OMCs), 394 PACS from 28 States/UTs have applied online for retail petrol/ diesel outlets. PACS permitted to convert bulk consumer petrol pumps into retail outlets : The existing bulk consumer licensee PACS have been given a one-time option by Oil Marketing Companies to convert into retail outlets. As per information shared by OMCs, 115 wholesale consumer pump licensee PACS from 5 States have given consent for conversion into Retail Outlets, out of which 62 PACS have been commissioned by the OMCs. PACS eligible for LPG Distributorship for diversifying its activities : The Government has now allowed PACS to apply for LPG Distributorships. This will give PACS an option to increase their economic activities and diversify their income stream. PACS as PM Bharatiya Jan Aushadhi Kendra for improving access to generic medicines at the rural level : PACS have been allowed to operate Pradhan Mantri Bhartiya Janaushadhi Kendras (PMBJKs), which will provide an additional income source to them and ease the access to quality generic medicines for rural citizens. So far, 4,192 PACS/ cooperative societies have applied online for PMBJKs, out of which 4,177 PACS have been given initial approval by the Pharmaceutical & Medical Devices Bureau of India (PMBI), and 814 PACS have received store codes from PMBI, which are ready to function as PM Bhartiya Jan Aushadhi Kendras. PACS as Pradhan Mantri Kisan Samriddhi Kendras (PMKSK): PACS have been enabled to operate PMKSK for ensuring easy accessibility of fertilizer & related services to farmers in the country. As per the information shared by the States/ UTs, as on 27 th November, 2025, a total of 38,190 PACS are functioning as PMKSK. PACS to carry out O&M of rural piped water supply schemes (PWS) : PACS have been made eligible to carry out the Operations & Maintenance (O&M) of PWS in rural areas. As per information received from States/ UTs, 762 PACS have been identified/ selected by 10 States/ UTs to provide O&M services at the Panchayat/ Village level. Convergence of PM-KUSUM at PACS level : Farmers associated with PACS can adopt solar agricultural water pumps and install photovoltaic modules in their farms. Convergence of PM Surya Ghar – Muft Bijli Yojana (PMSG–MBY) at the Cooperative Societies level: The initiative seeks to accelerate the adoption of clean and low-cost rooftop solar energy while leveraging the extensive grassroots presence of cooperative societies. 100 towns have been shortlisted for focused implementation of this initiative. 19. Micro-ATMs to Bank Mitra Cooperative Societies for providing doorstep financial services: Dairy and Fisheries cooperative societies can be made Bank Mitras of DCCBs and StCBs. To ensure their ease of doing business, transparency and financial inclusion, Micro-ATMs are also being given to these Bank Mitra Co-operative Societies with support from NABARD to provide 'Door-step Financial Services'. To facilitate effective implementation of the initiative, an SOP has been launched on 19th September 2024 & 12,624 Micro-ATMs have been distributed to Bank Mitra cooperative societies in Gujarat. 20. Rupay Kisan Credit Card to Members of Milk Cooperatives: To expand the reach of DCCBs/ StCBs and to provide necessary liquidity to the members of Dairy Cooperative societies, Rupay Kisan Credit Cards (KCCs) are being distributed to the members of cooperatives for providing credit at comparatively lower interest rates and to enable them to carry out other financial transactions. To facilitate effective implementation of the initiative, an SOP has been launched on 19th September 2024 & 16,48,105 Rupay KCC have been distributed in the State of Gujarat. Formation of Fish Farmer Producer Organization (FFPO): To provide market linkage and processing facilities to fishermen, NCDC registered 70 FFPOs in the initial phase. In addition, the Department of Fisheries, Government of India, allocated the work of converting 1000 existing fisheries cooperative societies into FFPOs to the National Cooperative Development Corporation. National Cooperative Development Corporation has identified 1000 Primary Fisheries Cooperatives Societies to strengthen as FFPOs, with an approved outlay of Rs 280.65 crore. A business plan for the selected societies is being prepared by the CBBOs. NCDC has disbursed ₹105 crore to FFPOs/CBBOs under the scheme. White Revolution 2.0 : The Ministry of Cooperation has launched an initiative to usher Cooperative-led "White Revolution 2.0” aimed at expanding cooperative coverage, employment generation and women's empowerment with an objective "To increase the milk procurement of dairy cooperatives by 50% from the present level over next five years by providing market access to dairy farmers in uncovered areas and increasing the share of dairy cooperatives in organised sector." The SOP for White Revolution 2.0 was launched on 19.09.2024 by Hon’ble Home & Cooperation Minister in the presence of Hon’ble Minister of Fisheries, Animal Husbandry and Dairying. On 25.12.2024, the Hon’ble Home & Cooperation Minister, in the presence of the Hon’ble Minister of Fisheries, Animal Husbandry and Dairying, inaugurated 6,600 newly set up Dairy Cooperative Societies. So far, 21,768 DCSs have been registered in 31 states/UTs. Atmanirbharta Abhiyan : Ministry of Cooperation has launched the initiative to incentivize production of pulses (tur, masur and urad) to reduce dependency on imports, and production of maize to be used for production of ethanol for meeting the goal of Ethanol Blending Programme (EBP) through National Cooperative Consumer Federation (NCCF) and National Agricultural Cooperative Marketing Federation of India (NAFED). Both have developed their own web portal, i.e., e-Samyukti and e-Samridhi, respectively, for registration of farmers through cooperatives. Both have assured pre-registered farmers of tur, urad, masur, and maize to procure 100% of their produce at the Minimum Support Price (MSP). However, if market prices exceed the MSP, farmers are free to sell their produce in the open market. A total of 42,87,484 farmers have already registered on the e-Samyukti portal of NCCF. Similarly, 13,90,862 farmers have registered themselves on the e-Samridhi portal of NAFED. Strengthening the Cooperative Banks Urban Cooperative Banks (UCBs) have been allowed to open new branches to expand their business: UCBs can now open new branches up to 15% (maximum 10 branches) of the existing number of branches in the previous financial year without prior approval of the RBI. UCBs have been allowed by the RBI to offer doorstep services to their customers: Doorstep banking facility can now be provided by UCBs. Account holders of these banks can now avail various banking facilities at home, such as cash withdrawal, cash deposit, KYC, demand draft, and life certificate for pensioners, etc. Notification of Scheduling norms for including Urban Cooperative Banks: UCBs that are in compliance with the Eligibility Criteria for Business Authorisation and have maintained the minimum deposits required for classification as Tier 3 for the last two years are now eligible to be included in Schedule II of the Reserve Bank of India Act, 1934, and get 'Scheduled' status. A Nodal Officer designated in RBI for regular interaction with UCBs: To meet the long-pending demand of the cooperative sector for closer coordination and focused interaction, RBI has notified a nodal officer. Relief for Urban Cooperative Societies (UCBs) by reducing PSL target from 75% to 60%: The Reserve Bank of India has provided relief to Urban Co-operative Banks (UCBs) by reducing the Priority Sector Lending (PSL) target from the earlier level of 75 per cent to 60 per cent. This relaxation has eased compliance pressures on UCBs and provided them with greater operational flexibility in managing their lending portfolios. Housing loan limit for Urban Cooperative Banks increased from 10% to 25%: Housing loan limit for members of Urban Cooperative Banks has been increased from 10% of assets to 25% (up to Rs 3 crore) of their total loans & advances. Relief in sub-limit of 12% sub-limit (weaker sections) by withdrawing of target of ₹ 2 lakh for women loan repayment: Removal of the target of ₹2 lakh for women borrowers under the 12% sub-limit for weaker sections simplifies PSL compliance and provides UCBs greater operational freedom in meeting PSL obligations. Relief to Urban Cooperative Institutions by increasing 50% loan limit from ₹ 1 crore to ₹ 3 crore: The loan and advances exposure limit for Urban Cooperative Banks (UCBs) at 50% of loans and advances has been increased from ₹1 crore to ₹3 crore, which helps them meet the higher credit demands of individual borrowers, supports business growth and improves their competitiveness in the retail and SME lending segments. Monetary ceiling for Gold Loan has been removed by RBI: RBI has removed the monetary ceiling from Rs. 2 lakhs for cooperative Banks at par with Commercial Banks. Umbrella Organization for Urban Cooperative Banks: National Federation of Urban Co-operative Banks and Credit Societies Ltd. (NAFCUB) has been established on the approval of the RBI as an Umbrella Organization (UO) for the UCB sector, which is providing necessary IT infrastructure and operational support to around 1,500 UCBs. It has launched various services like Digi Loan and Digi Pay. RBI extended the glide path for Security Receipts from FY 2025-26 to FY 2027-28: RBI, vide circular dated 24.02.2025, has provided an additional two years for provisioning of non-performing assets through Asset Reconstruction Company for better management of capital and liquidity in urban co-operative banks so that these banks can minimize the losses on stressed assets. Cooperative banks have been allowed to make one-time settlement of outstanding loans, like Commercial Banks: Co-operative banks, through board-approved policies, can now provide the process for settlement with borrowers, along with technical write-off. Higher Housing Loan Limits: Reserve Bank of India has increased the individual housing loan limit for rural co-operative banks by two and a half times to Rs. 75 lakh and enabled them to lend to real estate up to 5% of total exposure. License fee reduced for Cooperative Banks for AePS: License fee for onboarding Cooperative Banks to ‘Aadhaar Enabled Payment System’ (AePS) has been reduced by linking it to the number of transactions. Cooperative financial institutions are now to get the facility free of cost for the first three months of the pre-production phase. With this, members of onboarded Banks are now able to get the facility of banking at their home through biometrics. UIDAI on 01.08.2025 has introduced a new framework for onboarding of Cooperative Banks on the Aadhaar Enabled Payment System (AePS) . Now, only StCBs are required to onboard as Authentication User Agencies (AUA)/eKYC User Agencies (KUA); DCCBs will be allowed to use it through State Cooperative Bank as sub AUA/KUA. Non-scheduled UCBs, StCBs, and DCCBs notified as Member Lending Institutions (MLIs) in the CGTMSE Scheme to increase the share of cooperatives in lending: Cooperative banks are now able to take advantage of risk coverage up to 85 percent on the loans given. Also, cooperative sector enterprises are able to get collateral-free loans from cooperative banks now. CGTMSE rationalized the eligibility criteria from 5% Gross NPA or less to 7% Gross NPA or less for registration of Cooperative Banks as Member Lending Institutions (MLIs) under the Scheme. Banking Regulation Act is amended by the Government to make the term of the Board of Directors of Cooperative Banks as per the constitution (maximum 10 consecutive years). Limit for Agricultural Cooperative Societies (Dairy) under Priority Sector Guidelines increased from ₹5 crore to ₹10 crore: RBI has increased the priority sector lending limit for Agricultural Cooperative Societies (Dairy) from ₹5 crore to ₹10 crore vide Master Direction dated 24.03.2025. This move enables banks to provide more credit support to Agricultural Cooperative Societies (Dairy), thereby strengthening agricultural infrastructure and boosting rural credit flow. Sahakar Sarathi (Shared Service Entity): Sahakar Sarathi (Shared Service Entity) Private Limited has been established after approval of the RBI to provide technological services to Rural Cooperative Banks (RCBs) and their strengthening. This has launched 13 services for the Rural Cooperative Banking Sector. RBI vide its Notification dated 07.10.2025, has included rural cooperative banks in its Integrated Ombudsman Scheme . This will bring more transparency and accountability to the functions of rural cooperative banks. RBI vide Master Direction dated 04.12 2025, has allowed State Cooperative Banks (StCBs) and District Central Cooperative Banks (DCCBs) to open new branches (maximum 10) through an automatic route . StCBs & DCCBs, subject to eligibility, will now be able to open new branches without delay and can expand their business. RBI vide Master Direction dated 28.11.2025, has granted relaxation to the Rural and Urban cooperative banks in financial norms for providing modern banking services . The previous requirements of Gross NPA being less than 7% and Net NPA not exceeding 3%, and the net profit criterion have been removed. Now the cooperative banks can easily provide modern banking services to their customers. RBI vide Master Direction dated 04.12.2025, has issued Eligibility Criteria norms for Business Authorisation (ECBA), which will supersede the previous FSWM provisions . The clause regarding no penalties in the last two years has been removed from these norms. Now the Cooperative Banks will be able to easily open new branches and expand their business. RBI vide letter dated 07.01.2026 has issued clarification in reference to Section 20 of the BR Act, due to which the Directors of Rural Cooperative Banks and their related Cooperative Societies are now eligible to avail loans from their concerned State Cooperative Banks & District Central Cooperative Banks, subject to stipulated conditions. RBI vide Notification dated 19.01.2026 has included National Cooperative Development Corporation (NCDC) as an eligible entity under the on-lending provisions of the PSL framework . Now the loan extended by the Banks to NCDC for on-lending to cooperative societies for purposes like Agriculture, Housing, Social Infrastructure, etc., will fall under the PSL category. RBI has granted relaxation to specified borrowers like IFFCO to borrow more than 50% of their working capital requirements (incremental funds) from the banks. The Committee of Secretaries, chaired by the Cabinet Secretary, has recommended the inclusion of Cooperative Banks as participant institutions under various schemes of the Government of India. Various Ministries/Departments, like the Department of Animal Husbandry and Dairying has also revised their scheme guidelines to include cooperative banks. With a view to onboarding co-operative banks as Corporate Agents for undertaking insurance business , the Ministry of Cooperation has requested all States/Union Territories and co-operative banks to associate as Corporate Agents of the IFFCO joint venture company. With a view to mitigating cyber fraud and ensuring prompt reporting and response, the Ministry of Cooperation has requested all States/Union Territories and co-operative banks to onboard the I4C and NCRP portals. More than 600 cooperative banks have onboarded on I4C. A Task Force has been constituted under NABARD , in accordance with the mandate of the National Cooperation Policy, 2025, to provide necessary inputs for policy formulation and to address issues and challenges faced by the Rural Co-operative Banking sector.
The Ministry has constituted a Task Force under NAFCUB on ‘Transformation of Urban Cooperative Banks and Cooperative Credit Societies’ . The task force has submitted three reports. On the request of the Ministry, NABARD has submitted a report on Reforms, Restructuring, and innovation in Agriculture and Rural Development Banks (ARDBs).
The Ministry has completed a detailed study through IRMA for National Cooperative Agriculture & Rural Development Banks' Federation Ltd. (NAFCARD), resulting in an approved Action Plan that guides lending expansion, promotes non-farm sector activities, and strengthens cooperative governance.
The Ministry has completed a strategic study to elevate NAFSCOB’s role in Amrit Kaal (2022–2047). It outlines reforms for cooperative credit, digital integration, financial service diversification, and institutional strengthening. With emphasis on governance, state-level capacity building, and inclusive outreach, the roadmap positions NAFSCOB to lead cooperative banking and drive sustainable rural development across India. C. Relief to Cooperative Societies in the Income Tax Act Surcharge reduced from 12% to 7% for co-operative societies having income between Rs. 1 to 10 Cr.: This will reduce the burden of Income Tax on Cooperative Societies, and more capital will be available with them to work for the benefit of their members. MAT reduced for cooperatives from 18.5% to 15%: With this provision, now there is parity between Cooperative Societies and Companies in this regard. Relief in cash transactions under section 269ST of the Income Tax Act: To remove difficulties in cash transactions by cooperatives under Section 269ST of IT Act, Government has issued a clarification that cash transaction of less than Rs. 2 lakhs done by a cooperative society with its distributor in a day will be considered separately, and will not be charged with income tax penalty. Tax cut for new manufacturing Cooperative societies: The Government has decided that a flat lower tax rate of 15% will be charged, compared to an earlier rate of up to 30% plus surcharge, for new cooperatives commencing manufacturing activities by March 31, 2024. This will encourage the formation of new cooperative societies in the manufacturing sector. Increase in limit of Cash Deposits and Payments by PACS and PCARDBs: The Government has enhanced the limit for Cash Deposits and Payments by PACS and Primary Cooperative Agriculture and Rural Development Banks (PCARDBs) from Rs. 20,000 to Rs. 2 lakh per member. This provision will facilitate their activities, increase the business, and benefit members of their societies. Increase in limit of Loan and Loan Repayments in Cash by PACS and PCARDBs: The Government has enhanced the limit for Loan and Loan Repayments in Cash by PACS and Primary Cooperative Agriculture and Rural Development Banks (PCARDBs) from Rs. 20,000 to Rs. 2 lakh per member. This provision will facilitate their activities, increase the business, and benefit members of their societies. Increase in the limit of Tax Deducted at Source (TDS) in Cash Withdrawal The Government, through the Budget 2023-24, has increased the cash withdrawal limit of cooperative societies without deduction of tax at source from Rs.1 crore to Rs.3 crore per year. This provision will save Tax Deducted at Source (TDS) for cooperative societies, which they will be able to use to work for the benefit of their members. Enabling cooperatives to obtain low or nil TDS certificates W.e.f. 01.10.2024, the S.194Q has been brought under the ambit of S. 197, enabling the taxpayers to apply for a lower/nil deduction certificate in respect of transactions that require TDS compliance u/s. 194Q. TCS on the sale of goods under S.206C(1H) has been made ineffective A sunset clause has been inserted in Section 206C(1H), rendering the provisions of the said section inapplicable with effect from 1st April 2025. D. Revival of Cooperative Sugar MillsMinistry, updated Relief from Income Tax to Sugar Cooperative Mills : The Government has issued a clarification that cooperative sugar mills would not be subjected to additional income tax for paying higher sugarcane prices to farmers up to a Fair and Remunerative or State Advised Price, from April 2016 onwards. Resolution of decades-old pending issues related to Income Tax of Sugar Cooperative Mills : The Government has made a provision in its Union Budget 2023-24, wherein Sugar cooperatives have been allowed to claim as expenditure their payments to sugarcane farmers for the period before the assessment year 2016–17, giving them a relief of more than Rs.46,000 crore. Rs.10,000 crore loan scheme for strengthening of Sugar Cooperative Mills : The Government launched a scheme through NCDC for setting up ethanol plants, cogeneration plants, or for working capital, or for all three purposes.
The Ministry has released Rs.1000 crore to NCDC (Rs.500 crore in FY 2022-23 and Rs.500 crore in FY 2024-25) under the scheme, and NCDC has released Rs.10,005 crore to 56 CSMs. Preference to Cooperative Sugar Mills in purchase of ethanol : Cooperative Sugar Mills have now been put at par with private companies for ethanol procurement by the Government of India under the Ethanol Blending Programme (EBP). Strengthening of Cooperative Sugar Mills by converting their molasses-based ethanol plants into multi-feed ethanol plants: Ministry of Cooperation has taken the initiative in consultation with the National Federation of Cooperative Sugar Factories Ltd. (NFCSFL) for the conversion of existing molasses-based ethanol plants of CSMs into multi-feed ethanol plants. The Cooperative Sugar Mills (CSMs) also produce ethanol from molasses and sugar syrup by installing ethanol production plants. However, the availability of raw material, i.e., molasses and sugar syrup for production of ethanol, is limited by many factors, viz, Government Policy on diversion of sugarcane syrup, B heavy molasses for production of ethanol, and duration of sugar cane crushing season and availability of sugarcane depending on rainfall, etc. On account of these limiting factors, the CSMs having ethanol plants are not able to operate them at full capacity throughout the year. The Government of India has prioritized maize for the production of ethanol; therefore, it is prudent for CSMs to convert their existing ethanol production units into multi-feed ethanol production units so that they are able to produce ethanol by using maize as raw material. While NCDC has agreed to provide a loan for this purpose, DFPD has launched a scheme exclusively for cooperative sugar mills to provide interest subvention at the rate of 6% per annum or 50% of the actual interest, whichever is lower, for a period of 5 years on their loan. Further, OMCs shall give Priority-1 to CSMs, who will benefit from the Interest Subvention Scheme, for ethanol procurement, enabling transition from single feedstock to multi-feedstock. Reduction in GST on molasses from 28% to 5%: The Government has decided to reduce the GST on molasses from 28% to 5%, which will enable cooperative sugar mills to earn more profits for their members by selling molasses to distilleries with higher margins. Revival of closed Cooperative Sugar Mills: Indian Potash Limited, on the suggestions of the Ministry of Cooperation, has taken an initiative for the revival of closed Cooperative Sugar Mills. On 08.03.2025, Hon’ble Home and Cooperation Minister performed the “Bhoomi Pujan” ceremony for the revival and modernization of Shri Bileshwar Khand Udyog Khedut Sahakari Mandali Ltd., Kodinar, and Shri Talala Taluka Sahakari Khand Udhyog Mandali Ltd., Talala. In addition to this, IPL is also taking steps for the revival of Shri Valsad Sahakari Khand Udhyog Mandali, Ltd., Valsad. These steps will benefit thousands of farmers in the area where the above cooperative Sugar Mills are located. Three new National Level Multi-State Societies New National Multi-State Cooperative Seed Society for certified seeds: Government has established a new apex multi-state cooperative seed society under the MSCS Act, 2002, namely Bharatiya Beej Sahakari Samiti Limited (BBSSL) as an umbrella organization to focus on production, testing, certification, procurement, processing, storage, branding, labelling and packaging of all two generations of seeds i.e. foundation and certified, through PACS by leveraging various schemes and policies of different ministries of the Government of India. BBSSL has launched its seed under the brand ‘Bharat Beej’. So far, 33,077 PACS/ Cooperative Societies have become members of BBSSL New National Multi-State Cooperative Organic Society for organic farming : Government has established a new apex multi-state cooperative organic society under the MSCS Act, 2002, namely National Cooperative Organics Limited (NCOL) as an umbrella organization to provide institutional support for aggregation, certification, testing, procurement, storage, processing, branding, labelling, packaging, logistic facilities, marketing of organic products and facilitate in arranging financial assistance to the organic farmers through its member Cooperatives including PACS/FPOs along with promotional and developmental activities of organic products with the help of various schemes and agencies of the Government. So far, 11,823 PACS/ cooperative societies have become members of NCOL. NCOL has launched its products under the brand name of “Bharat Organics”. So far 28 organic products (Arhar Dal, Brown Chana, Chana Dal, Kabuli Chana, Masoor Malka, Masoor Split, Masoor Whole, Moong Dhuli, Moong Split, Moong Whole, Rajma Chitra, Urad Dal, Urad Gota, Urad Split, Urad Whole, Wheat Atta, Jaggery Cube, Jaggery Powder, Brown Sugar, Khandsari Sugar, Coriander Powder, Turmeric Powder, Fenugreek, Coriander Whole, Apple Cider Vinegar, Organic Goan Cashews, Organic Kashmiri Almonds, Organic Kashmiri Walnuts) under Bharat Organics brand are available in Delhi-NCR and Bangaluru. Bharat Organics products are 100% batch tested for 245+ pesticides in accredited laboratories. New National Multi-State Cooperative Export Society for promoting exports : Government has established a new apex multi-state cooperative export society under the Multi State Cooperative Societies (MSCS) Act, 2002, namely National Cooperative Export Limited (NCEL) as an umbrella organization to focus on exporting the surpluses available in the Indian cooperative sector by accessing wider markets beyond the geographical contours of the country, thereby, increasing the demand of Indian Cooperative products/services across the globe and fetch best possible prices for such products/services. It will promote exports through various activities, including procurement, storage, processing, marketing, branding, labelling, packaging, certification, research and development, etc, and trading o