Last year, the government had allocated ₹560 crore, and as per the revised budget estimate only ₹150 crore was utilised. Photo courtesy: PTI
One proposal that did not go unnoticed in the Indian Budget presented by Finance Minister Nirmala Sitharaman on Sunday is a strategy to transform Indian agriculture by harnessing cooperatives.
Pointing to demand number 16 of the Ministry of Cooperation, experts in the agriculture sector say that grant-in-aid of ₹450 crore has been provided to National Cooperative Exports Limited (NCEL).
Additionally, ₹364 crore has been allocated for computerization of Primary Agricultural Credit Societies (PACS).
“The scheme aims to computerize 67,930 functional PACS, which will increase efficiency, profitability, transparency and accountability in the functioning of PACS,” the demand letter said.
not fully utilized
Last year, the government had allocated ₹560 crore, and as per the revised budget estimate only ₹150 crore was utilised.
Experts say that if the allocation of NCEL and PACS is seen together then the government’s strategy becomes clear. “PACS are the backbone of cooperatives in the country, and the government is keen on their computerization. This will help the government take informed policy decisions and intervene in the market when needed,” said an expert.
The Finance Ministry allocating ₹364 crore for computerization of PACs despite the previous year’s funding not being utilized shows that this is an important area for the government, and the funds were not utilized due to slow progress of the project. The allocation continued even as Finance Minister Nirmala Sitharaman reduced funds for non-starter schemes announced in the last Budget.
Taking the lead in exports
Pointing to the allocation for NCEL, the expert said the cooperative export body will now lead agricultural exports and send more products. This allocation is more than four times the funds allocated for the Agricultural and Processed Food Products Export Development Authority (₹81 crore).
“The government’s strategy is to develop NCEL on a large scale. This will help in extending the benefits of cooperative NCEL to the rural economy,” said S Chandrasekaran, a New Delhi-based business analyst.
The policy support for NCEL is to help cooperatives and make the organization a social export institution.
NCEL Track Record
NCEL has been mainly exporting rice and wheat. It has also sent other commodities like sugar and coarse grains. “Grains is the starting point for NCEL to emerge as a big player in the export market. NCEL will likely include more commodities in its list of exports,” Chandrasekaran said.
The data shows that NCEL has exported 10.83 lakh tonnes (litres) of food grains in FY 2024-25, while overall, since its inception, the cooperative has exported 13.5 lakh tonnes (litres) of food grains. It played an important role in the export of rice and wheat when the government banned their shipment and said only government-to-government consignments would be allowed.
Exports have helped NCEL to work with various multinational business organizations. The expert said that cooperative export bodies, of which cooperatives like Amul, IFFCO, NAFED, KRIBHCO and NCDC are founders, will be able to take advantage of this to emerge stronger.
The government’s strategy is to utilize the database that will now be made available through computerization of PACS. This will give a real-time picture of the land including the availability of fertilizers. They will also provide market information on production, prices and demand.
export promotion
The National Cooperative Development Corporation (NCDC) will look into infrastructure aspects such as storage and warehousing. Chandrasekaran said, “This strategy will create synergy in the cooperative sector.”
The government is keen to set up 10,000 farmer-producer organizations (FPOs), this will create export incentives for PACS as well as NCEL.
“This strategy will create greater supply chains through access to cooperatives, farmers and FPOS,” the trade analyst said.
Experts say NCEL will likely become an important institution in the era of free trade agreements, just as organizations like APEDA emerged after globalization.
Published on February 4, 2026
