India Expands NCDC’s Mandate to Fund Cooperatives Directly
India’s Parliament has passed the National Cooperative Development Corporation (Amendment) Bill, 2026, expanding the NCDC’s power to provide loans and grants directly to cooperative societies — a move the Ministry of Cooperation says will cut bureaucratic delay and give cooperatives greater financial autonomy. Introduced by Mr. Murlidhar Mohol, Minister of State for Cooperation, and passed by both the Lok Sabha and Rajya Sabha, the Bill amends the National Cooperative Development Corporation Act, 1962, which had previously restricted direct NCDC funding largely to national-level cooperatives and those operating across more than one state.
Under the amendment, that eligibility widens to cover any cooperative society or entity engaged in cooperative development, subject to specified conditions — closing a gap the Ministry says had become a real constraint. Statutory bodies, state agencies and other specialised entities increasingly provide infrastructure, technology, processing, marketing and financial services benefiting cooperatives, but since many aren’t themselves registered as cooperative societies, the NCDC had no way to fund them directly, even where their work clearly served the sector.
The Bill also broadens the scope of what NCDC can finance: the definition of “foodstuffs” now extends to processed food, and the rural-location requirement for certain industrial goods has been dropped, reflecting a more modern and diversified cooperative economy. NCDC, established in 1963 under the Ministry of Cooperation, already runs flagship schemes including Yuva Sahakar, Ayushman Sahakar, Dairy Sahakar and Digital Sahakar. Not every voice in the debate was celebratory, though: some raised concerns that direct central funding could bypass state governments and blur lines of regulatory oversight in a sector where states have traditionally held significant authority — a federalism question likely to keep surfacing as the amendment moves into implementation.
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