Maharashtra’s Cooperation Minister Subhash Deshmukh wants to revive at least 5,000 cooperative bodies and institutions in the State by the end this calendar year with the help of India Inc.

There are over 22,000 cooperative bodies and 4 lakh women self-help groups but most are in dire financial conditions, Deshmukh says only a few are running successfully. He has an unconventional formula for their revival. The Minister, who hails from who hails from Solapur, does not want state subsidies to provide life-support to the 5,000 identified bodies, but wants to rope in the corporate sector for their revival. The Founder-Chairman of the Lok Mangal Group wants to leverage the cooperatives to sell the products of various corporates at the village level. Companies such as Royal Agro, BVG and the Mahindra Group are already in talks with the Maharashtra Cooperation Department for taking the process ahead.

In an exclusive interview with BusinesssLine , Deshmukh shared his game plan for the revival of cooperative institutions. Excerpts:

What has been your experience with cooperation sector in Maharashtra and how do you want to turn around the institutions that have been sick for many years?

In the last 18 years through a cooperative, society and a multi-state cooperative society, managed by Lok Mangal, I have raised ₹1,600 crore from the people as deposits.

When I became the Cooperation Minister of Maharashtra, I realised that if I could create cooperative institutions without support from the government, then many cooperative institutions can be revived in a similar manner.

The Atal Mahapanan Vikas Abhiyan (Atal Marketing Campaign) was launched by the Cooperation Department in December 2016 for the revival of moribund institutions. The campaign is based on the premise that the revival should happen by people's contribution and not by government subsidy.

What is your take on subsidies and freebies to the cooperation sector in Maharashtra?

Government data show that 80-90 per cent institutions, which have received subsidies are today financially sick. On the other hand, 80-90 per cent institutions that have not received any subsidies are prospering.

There are 22,000 registered cooperative institutions in the State of which less than 10,000 are functional. Even among these, only a few are managing to keep their head about water. There are only about 200 well-managed cooperative bodies in the State.

Therefore, we want to revive many of those bodies. It can be done through right guidance and strategic support. Since December 2016, about 800 bodies are showing signs of a turnaround. These include district co-operative purchase and sales unions and women's small-scale savings groups.

Today, Maharashtra has 4 lakh Mahila Bachat Gat (Women Savings Group) but not even one per cent are functioning properly. Over the years these institutions have been used for political, and not social, ends.

But rather than look at the missed opportunities, I want to try and revive these institutions. I am looking at institutions doing innovative work or have the potential to do innovative work and can be turned around.

What is your roadmap for such institutions?

In the past, the method for supporting such institutions was to provide loans from District Central Cooperative Banks at 2 per cent commission. But this was inadequate and flawed; it could not even create a surplus to cover the operational costs of the institutions.

But, today, not even ₹1 has been taken from the State Government to revive the institutions. Rather, the successful institutions have supported others by providing training programmes and support.

This year we are targeting a turn around of 5,000 institutions of which 1,200 have already come on stream. All such institutions have been asked to start new businesses, from selling manure to providing bottled drinking water.

What is the plan for the support from corporates?

We have approached some corporate houses for supporting cooperative institutions. Talks are on with Royal Agro, BVG and with the Mahindra Group. Our plan to open a store at the village levelon land owned by the cooperative body. The store can sell products of companies, with the cooperative body getting a commission. The products of the cooperative institutions can also be sold there. We do not want money from corporates, we want to tap their products and sell their products through cooperatives.

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