What socioeconomic issues influenced the formation of the cooperative movement in post-independence India? Also, emphasise the movement’s key traits. (150 Words)


  • Begin by providing a brief history of the cooperative movement.
  • Describe the socioeconomic factors that led to the establishment of the cooperative movement in India.
  • Finally, consider the impact of the cooperative movement.


The Indian cooperative movement was born out of adversity. It arose as a direct result of the Industrial Revolution, out of the upheaval and dissatisfaction that characterised the last quarter of the nineteenth century. The Revolution resulted in the demise of cottage industries and increased pressure on land, making agriculture an economically viable option.


The following factors contributed to the creation of the cooperative movement:

The Indian people’s illiteracy and poverty, the evil of poverty, led in debt to money lenders who abused them.

Excessive subdivision and fragmentation of holdings, a lack of alternative work, cattle losses due to hunger, sickness, and flood, and a passion of litigating family obligations all contributed to the expanding indebtedness.

The farmers were obliged to sell their things in order to satisfy their debts. Farmers led an anti-moneylender campaign in several sections of the country, including Poona and Ahmednagar.

Despite the existence of cooperative credit societies for nearly 50 years, the share of formal credit institutions to rural credit needs was less than 9%, with cooperatives accounting for less than 5% of that.

More than 75 percent of rural finance was provided by businessmen and wealthy landlords.

India witnessed the unprecedented phenomena of broad reforms being executed within a modern democratic structure without the use of violence or dictatorial force.

The following were the movements’ defining characteristics:

Independent India successfully transformed the colonial agricultural structure that it had inherited by drawing on the legacy of long, powerful national and peasant movements.

The consequences of over a half-century of rural stagnation were reversed. Institutional and infrastructure modifications were implemented to allow for the introduction of modern, progressive, or ‘capitalist’ farming in more and more sections of the country.

Large, semi-feudal, predatory landlords rack-renting the peasantry and taking illicit cesses in cash, kind, or labour vanished.


With the increased availability of cooperative and institutional financing, the moneylender’s stronghold on the peasantry was also significantly loosened. Such institutions’ loan advances climbed dramatically.

Credit became more accessible to the lowest elements of society. As a result, the resources available to the peasantry in general for agricultural improvement expanded dramatically.


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