Context: The Government of India has announced the formation of a separate Union Ministry of Cooperation by calling it an attempt to hijack the cooperative sector, which is presently a state subject.

Key objections to the formation of the Ministry of Cooperation

• Cooperatives is a State subject under entry 32 of the State list under Schedule 7 of the Constitution.
• Hence, the Opposition Parties have alleged that the creation of the Ministry of Cooperation is an attempt to infringe upon the federal rights of the state governments.
• “This is an intrusion into the authority of the state governments. This amounts to challenging the federal system of our country.”
• Moreover, the creation of cooperatives ministry strikes at the relationship between the Centre and the state governments, which is the basic structure of the Constitution.

Objectives of Ministry of Cooperation

• To provide a separate administrative, legal, and policy framework for strengthening the cooperative movement in the country.
• To streamline the process for ease of doing business and enable the development of Multi-State Co-operative Banks(MSCBs).

What are Cooperatives?

• Cooperatives are organisations formed at the grassroots level by people to harness the power of collective bargaining towards a common goal.

Constitutional Provisions Related to Cooperatives

• The Constitution (97th Amendment) Act, 2011 added a new Part IXB right after Part IXA (Municipals) regarding the cooperatives working in India.
• The word “cooperatives” was added after “unions and associations” in Article 19(1)(c) under Part III of the Constitution. This enables all the citizens to form cooperatives by giving it the status of the fundamental rights of citizens.
• A new Article 43B was added in the Directive Principles of State Policy (Part IV) regarding the “promotion of cooperative societies”.