National Cooperative Development Corporation (NCDC)

The Union Cabinet’s approval of the “Grant in Aid to National Cooperative Development Corporation (NCDC)” scheme is a crucial step to boost India’s cooperative sector, ensuring that cooperatives are able to expand and modernize their operations with necessary financial support.

Details of the Grant-in-Aid Scheme:

1. Financial Outlay:

   • The scheme has an outlay of ₹2,000 crore over four years (from FY 2025-26 to FY 2028-29), with ₹500 crore allocated each year.

   • The ₹2,000 crore grant will be sourced from the Government of India’s budgetary support.

   Market Raising Potential:

   • With the ₹2,000 crore grant, the NCDC will be able to raise up to ₹20,000 crore in loans from the open market, which will be used to finance cooperatives.

   Purpose:

   • The primary use of the funds is to provide loans to cooperatives to help them:

     • Set up new projects.

     • Expand existing plants.

     • Meet their working capital requirements.

   Target Sectors:

   • Cooperatives across various sectors are set to benefit, including:

     • Dairy

     • Livestock

     • Fisheries

     • Sugar

     • Textile

     • Food Processing

     • Storage and Cold Storage

     • Labour and Women-led cooperatives.

   • Around 2.9 crore members from 13,288 cooperative societies will benefit from this initiative.

   Implementation Strategy:

   • NCDC will be the executing agency responsible for:

     • Disbursing the loans.

     • Monitoring project implementation.

     • Recovering the disbursed loans.

   • Cooperatives will receive loans either directly from NCDC or through state governments, depending on their eligibility under the NCDC guidelines.

   • Those meeting the criteria for direct funding will be considered for loans against admissible security or a state government guarantee.

   Loan Utilization:

   • The funds will be provided as long-term credit for:

     • Setting up new facilities, modernizing existing ones, or upgrading technologies.

     • Expansion of project capacities in the key sectors.

   • Working capital loans will also be granted to ensure smooth operational flow and increase business efficiency.

Expected Benefits:

• Economic Empowerment: The scheme is designed to enhance the productivity and profitability of cooperatives, enabling them to compete better in the market.

  Employment Generation: The development of new projects and infrastructure will lead to increased job opportunities across different skill levels.

  Socio-Economic Growth: The focus on women-led cooperatives and labour cooperatives will help foster greater inclusivity in the rural economy.

  Sectoral Growth: Key sectors like dairy, textiles, and food processing are expected to see improved productivity, modernization, and capacity building.