ABSTRACT
Cooperatives in India, having originated in the colonial project of making credit available to the debt-ridden farmers of the Indian countryside, evolved into an indispensable instrument of planned economic action in the post-Independence period. They have remained under the protective and paternalistic care of the state, having been coopted into the expansive institutional structure of administration. The state’s approach to the development of cooperatives has centred on their instrumentality in terms of implementing government programmes, which in turn makes them vulnerable to political manipulation. As Taimni (1997) observes, state control has been exercised through a variety of institutions and policy instruments. For instance, the office of the Registrar of Cooperative Societies has been vested with the necessary powers to make cooperatives function as government arms, though the cooperative principles uphold democratic control as the greatest virtue of cooperative organisations. The most powerful instrument of state control, however, has been the financial patronage the government extends to the cooperatives in the form of share capital as also subsidies, concessions and guarantees.
