Cooperatives and Development: Lessons from the Punjab Experience (Sustainable AGRICULTURE DEVELOPMENT‪)‬

Both in conception and practice, cooperatives in the Punjab have been an important component of the government's development policy. The model was conceived as a 'multipurpose unit' aimed at serving its members by supplying credit, improved farm inputs, storage facilities, marketing assistance etc. In practice, however the major function has most often remained limited to the provision of credit and the improved farm inputs. As the bulk of resources have been supplied by the government, cooperatives are as much an agent of government administration, as a voluntary organisation. Even from the narrow perspective of their role as a vehicle for channelling government funds, cooperatives have been more active in distributing loans than in collecting these when due. The Punjab cooperatives are rural institutions which permit collective action by the more progressive farmers and which mediate between these farmers and the government. It enables the administration to target benefits and regulatory policy on that group of farmers, large or small, who contribute most to governments development goals--those who adopt improved technology. Nevertheless, cooperatives seem to have been less successful in accomplishing the governments' stated purposes, as the strategy has produced dissemination of benefits generally only to the most privileged sections of the rural society. The wider conclusion is that the experience in the Punjab hardly amounts to a test of the appropriateness of the institution of cooperatives as a development agent. The divided and hierarchical social structure of rural Punjab may point to the need for greater appropriateness of some alternative institutional device to encourage development. INTRODUCTION