New Delhi: Parliament has passed the National Co-operative Development Corporation (NCDC) (Amendment) Bill, 2026, marking a significant legislative update to the National Co-operative Development Corporation Act, 1962. The Rajya Sabha approved the measure on Thursday after the Lok Sabha had earlier given its consent. Minister of State for Cooperation Murlidhar Mohol moved the Bill in the Upper House, presenting it as a measure to strengthen the welfare and economic empowerment of crores of farmers across the country.
The National Co-operative Development Corporation is a statutory organisation under the Ministry of Cooperation. It was established in 1963 under the 1962 Act to plan, promote and finance programmes related to the production, processing, marketing, storage and export-import of agricultural produce, foodstuffs and other notified commodities, primarily through cooperative societies. The parent legislation has been amended on several occasions, including in 1973, 1974 and 2002, each time expanding the Corporation’s scope and enabling more direct financing of eligible cooperative societies. The 2026 Bill represents the most comprehensive revision to date.
Key Provisions of the Amendment
The Bill substantially broadens the Corporation’s mandate. Where the 1962 Act limited NCDC to financing programmes in specified sectors and commodities, the amended law empowers the Corporation to arrange, promote and finance cooperative development, either directly or through intermediary entities. This shift allows support for a wider range of cooperative initiatives beyond the earlier narrow commodity focus.
The definition of “foodstuffs” has been expanded. The original Act covered items such as milk, meat, eggs and vegetables. The Bill now includes processed food, other edible products and any additional food items notified by the Central Government. For industrial goods, the earlier restriction that confined support to specified cooperative and allied industries located in rural areas has been removed. Assistance can now be extended regardless of location.
On financial instruments, the Bill extends the Corporation’s ability to provide loans and grants. Direct assistance, previously limited largely to national and multi-State cooperatives, may now reach any eligible cooperative society or entity engaged in cooperative development, including those at the State level, subject to security conditions. Equity participation, once restricted to national and multi-State cooperatives, is now permitted in State-level cooperatives and other eligible entities, provided the Central Government grants prior approval.
Two new sections enhance operational flexibility. Section 9A grants the Corporation incidental powers, enabling it to undertake any activity necessary or incidental to the fulfilment of its functions. Section 13A empowers NCDC to collect or furnish credit and other information to the Central Government, the Reserve Bank of India, banks and registered financial institutions. References to the Multi-State Co-operative Societies Act, 1984 have been updated to the 2002 Act.
State governments will continue to serve as channels for financing cooperative societies. In addition, they may extend Corporation funding to other organisations engaged in cooperative development, provided the resources ultimately benefit cooperative societies.
Rationale and Sector Context
The government has cited several drivers for the amendment. The cooperative sector has grown and diversified, creating needs that the existing legal framework could not fully address. Direct financial assistance under the earlier law was largely confined to registered cooperative societies. Infrastructure, technology, processing and other specialised entities that support cooperatives could not receive direct financing. Greater institutional flexibility was required to allow NCDC to work through diverse channels while remaining focused on cooperative development.
India’s cooperative network ranks among the largest in the world. The country has more than eight lakh cooperative societies with approximately 30 crore members. Within this ecosystem, 80,000 Primary Agricultural Credit Societies (PACS) are being computerised and enabled to undertake around 25 different types of business activities. Tribhuvan Sahkari University has been established to supply trained and skilled manpower; it is expected to train around 17 lakh young people over the next five years. More than 163 major initiatives have been undertaken in the cooperative sector in the past five years alone.
Minister Mohol highlighted the sharp increase in financial support. From the establishment of NCDC in 1963 until 2014, cumulative financial assistance stood at approximately ₹45,000 crore. In the 12 years since 2014, assistance has risen to around ₹4 lakh crore. He described the Bill as a means to further strengthen the organised and sustained development of the cooperative sector and to advance the economic empowerment of farmers who form the bulk of its membership.
Implications for Cooperative Development
The amended framework positions NCDC to respond more effectively to contemporary requirements. State-level cooperatives gain improved access to loans, grants and equity capital. Entities providing specialised services—such as processing facilities, technology platforms or infrastructure—may now receive direct support if their activities advance cooperative development. The removal of the rural-area restriction on industrial goods opens avenues for cooperative units operating outside traditional rural locations while still serving rural producer members. The expanded definition of foodstuffs aligns the Corporation’s mandate with value-chain realities that emphasise processing and product diversification.
Credit-information powers under the new Section 13A are expected to strengthen due diligence and inter-institutional coordination. Incidental powers under Section 9A provide statutory room to address emerging needs without repeated legislative intervention. Oversight mechanisms remain in place: equity investments require Central Government approval, lending is subject to security norms, and information sharing is limited to designated public and financial institutions.
The Bill maintains the federal character of cooperative financing. State governments retain their intermediary role while gaining flexibility to channel resources to supporting organisations whose work ultimately benefits cooperative societies. This balance seeks to combine expanded reach with continued accountability.
Outlook
With parliamentary passage complete, the National Co-operative Development Corporation (Amendment) Bill, 2026 awaits presidential assent and subsequent notification. Once operational, the revised Act will enable the Corporation to deploy a broader set of financial and developmental instruments across a wider spectrum of cooperative and cooperative-supporting institutions. Implementation will determine how effectively the expanded mandate translates into deeper investment in processing, technology, marketing infrastructure and capacity building.
The legislation arrives at a time of sustained policy focus on modernising the cooperative sector. Computerisation of PACS, diversification of their business activities, creation of specialised training institutions and a substantial increase in financial outlays form part of a coordinated effort to position cooperatives as instruments of rural prosperity. The 2026 amendment supplies the statutory foundation for the next phase of that effort, equipping NCDC to match the scale and complexity of a network that touches the lives of 30 crore members across more than eight lakh societies.
FAQs
1. What is the National Co-operative Development Corporation (NCDC) (Amendment) Bill, 2026, and what does it seek to achieve?
The Bill amends the National Co-operative Development Corporation Act, 1962. It expands the mandate of the National Co-operative Development Corporation, a statutory body under the Ministry of Cooperation established in 1963, so that the Corporation can arrange, promote and finance cooperative development more comprehensively—directly or through intermediary entities—rather than limiting itself to programmes in specified sectors and commodities.
2. What are the major changes introduced by the Bill compared with the 1962 Act?
The Bill makes several significant revisions. It broadens the definition of “foodstuffs” to include processed food, other edible products and notified food items. It removes the rural-area restriction on support for industrial goods. It extends the Corporation’s power to provide loans and grants to eligible cooperative societies and entities engaged in cooperative development, including at the State level. It permits equity investment in State-level cooperatives and eligible entities with prior Central Government approval. New provisions grant incidental powers (Section 9A) and the authority to collect or share credit and other information with the Central Government, RBI, banks and registered financial institutions (Section 13A). References to the Multi-State Co-operative Societies Act are updated from the 1984 version to the 2002 Act.
3. Why was the amendment considered necessary?
The cooperative sector has grown and diversified beyond the original scope of the 1962 law. Direct financial assistance was largely restricted to registered cooperative societies, leaving infrastructure, technology, processing and other specialised supporting entities outside the funding net. The Bill responds to these limitations by giving NCDC greater institutional flexibility to support cooperative development through a wider range of channels while continuing to prioritise the ultimate benefit of cooperative societies.
4. What did the government state regarding financial assistance and the scale of the cooperative sector?
Minister of State for Cooperation Murlidhar Mohol noted that from NCDC’s establishment in 1963 until 2014, cumulative financial assistance stood at approximately ₹45,000 crore. In the 12 years since 2014, assistance has risen to around ₹4 lakh crore. India has more than eight lakh cooperative societies with about 30 crore members. Approximately 80,000 Primary Agricultural Credit Societies are being computerised and enabled to undertake around 25 business activities. Tribhuvan Sahkari University has been set up to train roughly 17 lakh young people over the next five years, and more than 163 major initiatives have been launched in the cooperative sector in the past five years.
5. How does the Bill affect funding for State-level cooperatives and other entities?
State governments may continue to channel NCDC funds to cooperative societies and may also extend funding to any entity engaged in cooperative development, provided the resources ultimately benefit cooperative societies. The Corporation itself can now provide loans and grants directly to eligible cooperative societies and entities involved in cooperative development (subject to security conditions) and can take equity stakes in State-level cooperatives and eligible entities with Central Government approval.
