Centre Approves Rs 2000 Cr Scheme for Dev of Cooperatives via NCDC

To strengthen the cooperative sector in the country, the central government has approved a Rs 2000 crore grant to the National Cooperative Development Corporation (NCDC) through a new central sector scheme -  “Grant in aid to  National Cooperative Development Corporation”. 

The scheme, which seeks to provide fresh capital to the cooperatives in the country, was approved at a Union Cabinet meeting held in New Delhi on 31 July 2025, which was chaired by Prime Minister Narendra Modi.

The scheme is likely to benefit around  2.9 crore members of 13,288 Cooperative societies of various sectors like Fisheries, Sugar, Textile, Dairy, Livestock, Food Processing, Storage and Cold Storage; Labour and Women-led cooperatives across the country..

Duration of the Scheme

• The duration of the Grant in aid to the National Cooperative Development Corporation scheme is four years from 2025-26 to 2028-29.

Financial Allocation for the Scheme

The total allocation for the scheme is Rs 2000 crore for the four fiscal years from 2025-26 to 2028-29. 

The NCDC will get Rs 500 crore per year. 

The amount is a grant-in-aid. It means that the NCDC will not return the money to the central government.

The grant will be provided through budgetary allocation every year.

The NCDC will also raise Rs 20,000 crore from the market over a four-year period.

Function of the NCDC 

The NCDC will provide loans to the Cooperative sector in the country either through the state government or directly.

The loan will be provided to the cooperatives for both capital and current expenditure.

Loans will be provided to fund capital expenditure of the cooperatives for setting up new greenfield projects or for the expansion of existing plants.

Loans will also be provided to the cooperatives to meet their current expenditures on purchasing raw materials, payment of salaries, etc.

The NCDC will be the nodal agency for the implementation and monitoring of the project, and recovery of loans disbursed from the fund.

About the National  Cooperative Development Corporation (NCDC)

It was established in 1963 with its headquarters in New Delhi.

It is a statutory body which was set up under the provisions of the National Cooperative Development Corporation Act 1962.

The NCDC is under the Union Ministry of Cooperation.

Function

• Provide financial support to the various cooperatives in the country .
• Provides loans to the State government for financing primary and secondary-level cooperative societies.
• It assists the cooperatives in expanding their financial base.
• It also provides loans to the projects in the rural industrial cooperative sectors and for certain notified services in rural areas like water conservation, irrigation and micro irrigation, agri-insurance, agro-credit, rural sanitation, animal health, etc.