Network Past Issues

In the previous issue of Network, the summary of recent court orders from the High Court of Andhra Pradesh and Kerala was published. Following response received from Network readers is chosen to be published in this issue.

COOPERATIVE AUTONOMY: ISSUES OF INTELLIGENTSIA BIAS & THE POLITICO-BUREAUCRATIC POWER INSTINCT

K. T. Thomas (PRM 90-92) 

 Recently, Milma-the Kerala Dairy Federation-fought and won its case against the State government’s administrative objection against milk price enhancement. The issue attracts a fresh lot of discussions regarding the autonomy of cooperatives.

The row over the milk price revision was raging quite long in Kerala. Once, a Letter to the Editor appeared in one of the lead Malayalam newspapers. It was by a doctor-consumer. It seemed she had some childhood rural exposure. She elaborated the pains of cow keeping; and finally, proclaimed her finding: the board members of Milma are not farmers at all! Her reason: they are seen in clean attire; and the female lot of them wears silk saris! So their demand for better price is for such extravaganzas!

The doctor had no idea that only dairy farmers actually keeping cows and pouring milk to the village cooperatives could be the member of Milma, let alone its board. The reason for her prejudice was simple: a farmer is supposed to be seen only in dirty dress, toiling all the time in the fields; they are not supposed to come to the cities and conclave for better price, etc. How dare these petty guys claim allowances too for the meetings?

See how the upper intelligentsia views it when the farmers demand for better price for their produce. They mostly belong to the salaried class. Over the years, these so-called freak thinkers have got established a sort of social conviction; that the structured income frameworks such as scale-of-pay, pay revisions, increments, dearness allowance, overtime, night shift allowance, holidays, holiday wages, leave-travel benefits, medical benefits, honorarium for meetings etc are only meant for the salaried class for their “privileged efforts”. It is only they who are entitled to wear good clothes and enjoy the urban extravaganzas.
Unfortunately, it is this upper class stream of thinking in the society that is taken over and endorsed by the government when commodity pricing issues come up. In the eyes of the State, “public” means the minority group of urban consumers and “efforts” means the white and blue collared jobs that happen in the offices and factories.
The farmers put harder efforts with higher risks and uncertainties. But when they demand remunerative returns for that, pandemonium gets raised up. In the “efforts market”, salaried jobs are assigned a premium while farming jobs are looked down upon. The result: farming never commands the social status of a “decent” occupation. No farmer ever wishes to see their next generation in farming. The issue of cooperative autonomy is very much linked to this social bias towards agriculture and allied sectors. Cooperatives can function independently like any other business entity only if they succeed in winning over this bias. For this, they have to confidently fight out the blind intelligentsia.
The government generally ignores the distinctive stand of the cooperatives in favor of the majority group -the farmers. It gets influenced by the upper-income consumer sect who is more vociferous. Strategies are worked out to establish command of the State in their administrative affairs and business policies. Thus the autonomy of the cooperatives ends up in peril. There is also one more reason for this fight between the cooperatives and the government. While the cooperatives stand for the survival instinct of its members, the State bureaucracy has a stake in retaining their power base. Their varied interests include creation of many posts and related promotional avenues, dealing in the developmental fund allocations and enjoying the related “benefits” thereof etc.
The State is an inert establishment, very lethargic to remold its systems and practices in response to the environmental dynamics. It never possesses the members’ benefit orientation of the cooperatives. It was to reverse this scenario that the Anand Pattern of dairy development was promoted. The Operation Flood had changed the “State-managed” dairy development, substituting it through the cooperatives. The farmers themselves took over the production-procurement-processing-marketing affairs of milk. The stakeholder-orientation and survival-drive are the key features of these farmer-centric systems. It forces them to continuously update themselves for successful indulging with the production & marketing realities of their operating universe. With their “hands-on” experience, the cooperatives became self-dependant entities surviving on revenues from the market operations. Using these funds, the farmers created their own capital assets, technocrats & employees, market command, operational knowledge base etc.
But the conventional governmental systems (both bureaucratic and political) have not well taken this cooperative invasion into the State domain of action. Kerala is one of such States. The government was vehemently fighting in the High Court against the farmers’ plea for better price of milk. The ground for the higher price demand had been sufficiently established by a government study as well as another cooperative study on cost of production. But it was conveniently ignored when the question came as to who will decide on milk price.
An example totally contrasting to this Kerala scenario is Gujarat. Here, the dairy cooperatives enjoy reasonable autonomy in their business policies. The cooperatives command the sector vis-a`-vis the government and their farmer and market sensitive business policies are resulting in a boom in milk production. In Maharashtra, government system runs parallel to cooperatives in low profile. There, the private sector is coming up in big way. In Tamil Nadu and Andhra Pradesh, the cooperatives are killed by governmental take over of their affairs from the democratic system of farmers. There the private sector is booming. Wherever milk production is flourishing under the cooperatives or private sector, the markets are financing the production growth. Karnataka is an exception, where the State is giving “output based support” as extra farmer price of Rs.2 per liter of milk procured through cooperatives. This has not only created “entry barrier” to private procurers, but also kept the sales price of milk lowermost in the country, thus restricting invasions in market too.
The Karnataka model “State-sponsored” development action through the cooperatives is ideal for the society at large. In its place, when the dairy development becomes “State-managed”, the public funding is mostly spent to maintain bureaucratic administrative bodies that have limited stakes in production enhancement and wealth creation. Because of the fact that they are dependent neither on the farmers nor on the markets to self-survive, these systems lack updated knowledge on the operational realities of production and marketing.
Such a situation doubles the strains of farmers’ executives to effectively work with a decisive inclination to the poor in a liberalized market economy. Therefore the need of the hour is strengthening the cooperatives to enable them create more and more wealth from the markets and to finance the production increase. The States should understand that there is limitation to find enough public exchequer funds to support the production enhancement. There is still higher limitation to use the available State funds in a farmer-beneficial way.
The State can play a positive role by strengthening the cooperatives by providing capital for growth investments as well as output/performance-based incentives, but without “strings attached”. Let them understand that if let free without interferences in their autonomy, the cooperatives, in their own way, can probably play a better welfare role than the government by sustained and efficient enhancement of wealth and by distributing to very large populations.

--------
The author can be contacted: md@malabarmilma.coop