Centre Unveils Major Cooperative Expansion Plan With 2 Lakh New Multi-Purpose Societies by 2029

Government targets 2 lakh new multi-purpose cooperative societies by 2029 with over ₹4.21 lakh crore support to modernise rural credit and services.

Pune|11 December 2025: Government aims to set up two lakh multi-purpose cooperative societies by 2029 with major financial expansion and modernisation push.

The Union Government has set an ambitious target to establish two lakh new multi-purpose cooperative societies across the country by 2029, marking one of the largest expansions of the cooperative sector in recent years. The plan aims to ensure that every panchayat has access to at least one modern and fully functional cooperative institution. Around 32,000 societies have already been formed, and the next phase focuses on rapid formation, digital transformation and financial strengthening.

In the last eleven years, cooperatives have received a major boost through an overall financial support of more than ₹4.21 lakh crore. This represents a dramatic increase compared to earlier decades and highlights the growing dependence on cooperatives as engines of rural credit, storage, procurement and livelihood generation. Officials believe that strengthening cooperatives is essential to improving rural productivity and reducing dependence on informal lenders.

A key step in the reform plan is the ongoing computerisation of nearly 79,000 Primary Agricultural Credit Societies. The project, costing more than ₹2,900 crore, aims to replace outdated manual systems with real-time digital operations. Once fully implemented, these institutions will be able to provide faster credit approvals, transparent accounting and seamless linkage with banks, financial agencies and farmers.

The government has also introduced new model by-laws that allow cooperative societies to expand their scope to more than 25 different activities. This shift encourages societies to diversify into services such as agri-input supply, crop procurement, storage, cold-chain operations, processing and local retail. By widening their business activities, societies are expected to generate additional income and reduce financial vulnerability.

A major challenge the reforms aim to solve is India’s shortage of scientific storage facilities for food grains. Many farmers face significant post-harvest losses due to poor storage conditions and long transport distances. To address this gap, an extensive decentralised storage program is being implemented, with new warehouses being built closer to farming zones. Several storage centres have already been completed, and more than 700 cooperative societies have been approved for new or expanded storage infrastructure. These decentralised warehouses are expected to reduce wastage, stabilise prices and strengthen local market access.

To ensure that these storage centres remain financially viable, national agencies have already entered agreements to use cooperative-managed storage facilities. Guaranteed utilisation helps societies maintain steady revenue while creating rural employment around storage, handling and logistics. The government is also considering simplified rules for closing defunct cooperative societies so new, financially sustainable ones can take their place.

Experts believe this large-scale push will transform cooperatives into modern rural service hubs. Traditionally limited to credit and basic support, cooperatives are now expected to operate with diversified business models, upgraded technology and wider community impact. The movement is equally important for empowering small producers, self-help groups and rural entrepreneurs who rely on accessible and affordable financial services.

The upcoming years are likely to be crucial as new societies are formed and digital systems become operational. By 2029, the country may see a stronger cooperative ecosystem capable of driving rural development, improving incomes and supporting national goals for economic inclusion.

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