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Importance of Cooperatives and Economic development?

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What are the Importance of Cooperatives and Economic development?
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Cooperatives can play a significant role on economic development, especially in rural areas where absence of large spending power does not attractive private investment to harness local skills and resources that can uplift the local economy living standards besides exporting produce to distant customer locations in cities. Cooperatives of farmers enable consolidation of fragmented land, investment in mechanization and irrigation, better bargaining power to buy seeds and fertilisers cheaply, arrange for proper common storage and greater bargaining power in selling farm produce to traders as also make banks comfortable in providing agricultural credit, thereby improving the productivity of agriculture and improving the incomes of farmer members of the cooperatives. Cooperatives if fishing/ pisciculture, animal husbandary and dairy, residential housing, and other economic activities can contribute similarly to economic development.
Some examples:
Trempealeau County, Wisconsin
In the early 1980s, the school districts in Trempealeau County, Wisconsin were faced with dwindling enrollments and the threat of school closures. School district supervisors and board members came up with a plan to simultaneously preserve local schools and improve the quality of education. They installed an interactive cable television system in the county’s six school districts, thus allowing schools to offer courses together and maintain adequate enrollments per course via distance education. As a side benefit, this project also resulted in the first rural cable co-op in the U.S.
Mt. Horeb, Wisconsin
In the mid-1990s, community leaders in Mt. Horeb, Wisconsin became concerned about older residents having trouble keeping up their homes and leaving the community in order to find more appropriate housing. With assistance from the Homestead Housing Center, Mt. Horeb opened a 25-unit senior housing cooperative in 1997 that provides apartment-style living, a generous amount of common space and some support services. There is a valuable side benefit of the cooperative: many of the homes formerly occupied by older residents have been bought by young families, thus alleviating a second housing problem in the village -- a shortage of single family homes.
Fayette County, Iowa
The biggest agricultural complaint among Iowans, including farmers, in recent years is the bad smell that emanates from hog farms. A group of farmers and community leaders in Fayette County, Iowa came up with an idea to make a business out of this problem. Several members of the group researched and developed a commercial composting business that collects manure solids from area farms and mixes them with recycled paper and yard waste to produce a bagged, odorless compost that is sold to farm and garden centers. The separation of the liquid and
Chain stores and edge-of-town malls have spread across the rural landscape in the United States in the past two decades. They have often left in their wake failed local merchants and down-at-the-heels downtowns. In the early 1980s a group of Wisconsin pharmacy owners formed what is now called the Independent Pharmacy Cooperative. The cooperative provides a means for its members to pool their buying power and bargain with suppliers for steep discounts on prescription and over-the-counter drugs, cosmetics and hundreds of other items carried in drug stores. The resulting reduced costs have improved the ability of these phamarcies to compete with chains. The co-op now has over 2,000 member-owners.
The stories summarized above illustrate different ways in which people can engage in cooperative action to improve economic conditions and the quality of life in their communities. Similar examples can be given for local government purchasing cooperatives, child care centers, home care services for the elderly, transportation services and dozens of other cooperative projects.
These examples describe three kinds of cooperation:
1. cooperation as a process in which a group of local community residents engage in joint economic development planning (the composting project was developed through this kind of planning process);
2. formally organized cooperation in which a business is democratically owned and controlled by its members and is incorporated as a cooperative (the pharmacy co-op, the senior housing co-op); and
3. functional cooperation in which a business is not a formal cooperative but is owned and controlled in a manner similar to a formal cooperative (the school district distance education project).
These different kinds of cooperation -- involving local people, local businesses and local governments working together to address community problems – are part of a broader set of strategies which can be referred to as locally-based development. Before we discuss these cooperative strategies in more detail, it is important to get a better understanding of the broader strategy of locally-based development.
Dairyland Power Cooperative is a Regional Partner for Touchstone Energy Cooperatives, an alliance of more than 600 cooperatives in 45 states, which collectively deliver power and energy solutions to more than 22 million customers every day.
By working together, we are:
Providing educational tools like the Get Charged! Program to area schools.
Creating savings for members with the Co-op Connections discount card program.
Promoting energy efficiency with an online Home Energy Audit and energy savings guides for homes (PDF) and businesses (PDF).
Creating powerful Community Connections by supporting community activities.
Touchstone Energy Cooperatives:
Provides high standards of service to all customers—residential, commercial, industrial and agricultural.
Is an educational initiative that communicates electric cooperatives’ unique characteristics in a changing marketplace where these values and differences matter more each day.
Emphasizes the significance of each electric cooperative’s local presence and unique ties to its community, but offers the resources of a nationwide network to bring added value and benefit to customers.
This is what one electric utility cooperative in the US has to say : The people who founded Wood County Electric Cooperative back in 1938 chose the cooperative form of business to keep costs low and keep local control over the electric utility. We’re still true to that commitment today.
Another electric cooperative: The Electric Cooperatives of Arkansas are committed to matching your company with the right location. We serve approximately 460,000 homes, farms, businesses and industries in Arkansas, encompassing more than 60 percent of the state's land area.
The Electric Cooperatives of Arkansas play an active role in the community and economic development of our state. By maintaining a low cost and abundant power supply backed by an active infrastructure enhancement and business recruitment program, the cooperatives plan to keep Arkansas a vital, powerful economic opportunity for your company.
There are about 60 Fortune 500 firms with operations in Arkansas. Five of these firms, ALLTEL Corporation, Dillard's Department Stores, Inc., Tyson Foods, Inc., and Wal Mart Stores, Inc. are headquartered here. Five of the largest trucking companies are located here including J.B. Hunt Transport. Manufacturers such as Whirlpool Corporation, B.F. Goodrich Aerospace, Maybelline Cosmetics, Green Bay Packaging/Kraft Paper, Remington Arms, Bekaert Corporation, Scroll Technologies and steel giant Nucor-Yamato Steel also have operations in Arkansas. Knowledge and information-based companies such as Acxiom Corporation, BEI Sensors and Systems, and Electronic Data Systems are here. The world's largest marketer of rice, Riceland Foods, is headquartered here.
To help attract businesses to Arkansas, the Electric Cooperatives of Arkansas, in conjunction with the Office of the Governor and the Arkansas Department of Economic Development, offer a combination of competitive incentives; an excellent infrastructure network including telecommunications, water, truck, rail and interstate highways; and affordable power rates. We are capable of supplying an abundance of electricity through ten generating stations which utilize low-sulfur coal, oil, natural gas or hydroelectric power.
The Electric Cooperatives of Arkansas have an experienced and supportive economic development department. Just one call, and our economic development staff will become your partner in finding potential sites and evaluating cost to make your business or industry more profitable. We are experienced and dedicated to working with client confidentiality and have a commitment to respond promptly with complete information.
One great example from India: Amul (Anand Milk-producers Union Limited), formed in 1946, is a dairy cooperative movement in India. It is a brand name managed by an apex cooperative organisation, Gujarat Co-operative Milk Marketing Federation Ltd. (GCMMF), which today is jointly owned by some 2.6 million milk producers in Gujarat, India.. It is based in Anand town of Gujarat and has been a sterling example of a co-operative organization's success in the long term. The Amul Pattern has established itself as a uniquely appropriate model for rural development. Amul has spurred the White Revolution of India, which has made India the largest producer of milk and milk products in the world. It is also the world's biggest vegetarian cheese brand Amul's product range includes milk powders, milk, butter, ghee, cheese, curd, chocolate, ice cream, cream, shrikhand, paneer, gulab jamuns, basundi, Nutramul brand and others. In January 2006, Amul plans to launch India's first sports drink Stamina, which will be competing with Coca Cola's Powerade and PepsiCo's Gatorade Amul is the largest food brand in India and world's Largest Pouched Milk Brand with an annual turnover of US $1050 million (2006-07). Currently Amul has 2.6 million producer members with milk collection average of 10.16 million litres per day. Besides India, Amul has entered overseas markets such as Mauritius, UAE, USA, Bangladesh, Australia, China, Singapore, Hong Kong and a few South African countries. Its bid to enter Japanese market in 1994 had not succeeded, but now it has fresh plans of flooding the Japanese markets . Other potential markets being considered include Sri Lanka.
Another Indian example : Shri Mahila Griha Udyog Lijjat Papad, popularly known as Lijjat, is an Indian women's organization manufacturing various products. The organization's registered office is situated in Mumbai and it has 67 branches and 35 divisions all over India[2].

Started in 1959 with a capital of INR 80, Lijjat today has an annual turnover of around Rs. 315 crore (Rs. 3.15 billion), with Rs. 12 crore in exports and has around 42,000 employees Lijjat is primarily a cottage industry, urban by its origin, that has spread to the rural areas. It is considered as one of the most remarkable entrepreneurial initiatives by women that is identified with women empowerment in India.
Lijjat believes in the philosophy of sarvodaya and collective ownership. It accepts all its working members as the owners and an equal partaker in both profit and loss[8]. The members are co-owners and fondly referred to as "sisters". All the decisions are based on consensus and any member-sister has the right to veto a decision[24]. Men can only be salaried employees (accountants, drivers or security guards), and not the members of the organization (i.e. they are not the owners). The growth of the Lijjat is often seen in the larger canvas of women and their empowerment. The organization has undertaken various efforts to promote literacy and computer education for member-sisters and their families. A literacy campaign for sisters began through literacy classes at Girgaum on June 18, 1999. Later, the managing committee decided to start such classes in all its branches[10]. From 1980 onwards, Lijjat started giving Chhaganbapa Smruti Scholarships to the daughters of the member-sisters[28].

The member-sisters used their organization as a medium to promote their and their families' welfare. In the Valod centre they set up an educational and hobby centre for the rural women. Orientation courses in typing, cooking, sewing, knitting and toy making as well as other courses like child welfare, first aid and hygiene were taught[29]. The first ever pucca (tarred) road in Valod to be built and inaugurated in 1979 was with the help of the Lijjat, Valod branch[30].

In 1979, Lijjat teamed up with UNICEF to organize a seminar in Mumbai on "Child Care and Mother Welfare", as part of the International Year of the Child celebrations[31]. In October 1984, Bhadraben Bhatt represented Lijjat at the UNESCO sponsored international workshop on "The role of women in the assimilation and spread of technological innovation" held at NITIE, Powai[32]. Alkaben Kalia represented Lijjat at the national level meeting on women convened by the National Commission on Self Employed Women[33].

At the behest of Mother Teresa, the member-sisters also took part in some activities of Asha Dhan, an institution to care for destitute women[34].

Lijjat member-sisters also tried to start a co-operative bank, but the effort was not very successful[35].

[edit] Contribution to social service
On several occasions, the Lijjat member-sisters have undertaken social service activities such as distributing nutritious food for poor children, donating money for conducting community marriage, instituting prize-money for spread of primary education, undertaking blood donation drive, organizing health camps, plantation drives and even making donations to Government bodies



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