Amul & IFFCO Become World’s No. 1 & No. 2 Cooperatives

NATIONAL HERO — PETAL (Nov 13, 2025)
Syllabus: GS3 / Economy / Cooperative Sector

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THEMATIC FOCUS

Cooperatives • Inclusive Growth • Rural Economy • SDGs • Constitutional Amendments

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INTRO WHISPER

🌾 “When millions of hands hold a system instead of a shareholder, it becomes more than a business — it becomes a movement.”

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KEY HIGHLIGHTS

1. India Dominates Global Cooperative Rankings

The ICA World Cooperative Monitor 2025 has ranked:

• Amul (GCMMF) — World No. 1 Cooperative
• IFFCO — World No. 2 Cooperative

The ranking is based on turnover-to-GDP per capita ratio and recognises both organisations as global leaders in democratic, member-driven enterprises.

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2. Why Amul Stands at the Top

Amul’s three-tier cooperative structure includes:

• Over 18,600 village dairy societies
• More than 36 lakh milk producers, mostly women
• Complete farmer ownership and management of milk collection, processing, and marketing

Amul has shown how small producers gain global strength through collective action.

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3. IFFCO — A Fertiliser Giant Built by Farmers

Founded in 1967, IFFCO is one of the world’s largest fertiliser cooperatives.
It has consistently held the top global rank and remains a benchmark of:

• Democratic functioning
• Efficient supply of fertilizer
• Adherence to cooperative principles

IFFCO’s rise highlights the strategic role of cooperatives in India’s agri-input ecosystem.

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4. Understanding Cooperatives

A cooperative is a member-owned, member-run enterprise where:

• Each member has one vote, irrespective of capital
• The purpose is to meet members’ needs, not maximise shareholder profit
• Profits are distributed based on use or contribution, not investment

Cooperatives strengthen economic democracy.

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5. Constitutional & Legal Foundations

97th Constitutional Amendment (2011) introduced transformative reforms:

• Added the Right to form cooperatives under Article 19
• Inserted Article 43B promoting cooperative societies
• Added Part IX-B (Articles 243ZH–243ZT) for cooperative governance
• Clarified powers of Parliament and State Legislatures for cooperative laws

This makes India one of the very few countries with constitutional protection for cooperatives.

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6. Role of Cooperatives in Sustainable Development

The UN and ICA recognise cooperatives as powerful engines for:

• Reducing inequality
• Creating decent work
• Strengthening local economies
• Empowering the poor, especially women
• Supporting rural development

India’s model — as demonstrated by Amul and IFFCO — is a global benchmark.

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7. Challenges in India’s Cooperative Sector

Despite successes, cooperatives face:

• Weak governance and political interference
• Limited credit access
• Competition from corporates and MNCs
• Technological backwardness in rural areas

Reforms in transparency, digital governance, and financial access are essential.

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8. Government Support and Way Ahead

Key policies & institutions shaping the cooperative ecosystem:

• National Cooperative Policy (2002)
• Cooperative Societies Act (State & National levels)
• Multi-State Cooperative Societies Act, 2002
• Ministry of Cooperation (2021)

With structural reforms, professionalisation, and technology adoption, cooperatives can drive:

• Rural prosperity
• Women’s empowerment
• Inclusive economic growth
• India’s movement toward “Sahakar se Samriddhi” (Prosperity through Cooperation)

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GS PAPER MAPPING

• GS3 – Economy: Inclusive growth, rural development, agri-value chains
• GS2 – Governance: Democratic institutions, cooperative federalism, constitutional amendments
• GS1 – Society: Community-led development, women empowerment
• GS3 – Agriculture: Input supply, farmer organisations, dairy sector

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IAS MONK WHISPER

🥛 “A cooperative is not built by capital — it is built by trust.
And trust, when multiplied by millions, becomes a force stronger than markets.”

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High Quality Mains Essay For Practice :

Word Limit 1000-1200

Amul & IFFCO: How India’s Cooperative Giants Became World No. 1 and No. 2

Cooperatives are one of the oldest economic institutions in India, yet they remain among the most misunderstood. They are often seen as rural, traditional, or limited in scope, but in reality, they represent one of the most powerful models of economic democracy in the world. India, more than any other country, has demonstrated the sheer transformative power of cooperatives—where millions of small producers come together to compete with global corporations, not through private capital but through collective strength. This spirit has now received international recognition as Amul’s parent body, the Gujarat Cooperative Milk Marketing Federation (GCMMF), secured the World No. 1 rank and IFFCO secured the World No. 2 rank in the ICA World Cooperative Monitor 2025. For the first time in the history of the rankings, two Indian organisations stand at the top of the global cooperative pyramid. This achievement is not an accident; it is the result of decades of institution building, democratic participation, and the belief that when the smallest producers unite, they can move mountains.

The rise of Amul is a remarkable story, not merely of milk but of empowerment. The three-tier cooperative system developed by Dr. Verghese Kurien transformed rural Gujarat and later much of India. At the village level are thousands of dairy cooperatives where farmers bring their milk every day. These village societies form district unions, which manage processing plants, and these unions together form the state-level federation—GCMMF. Through this system, milk producers—mostly women—own the organisation. They decide prices, elect leaders, manage operations, and share profits. Today, Amul includes more than 18,600 village cooperatives and 36 lakh farmers, making it one of the largest farmer-owned enterprises in the world. What is truly extraordinary is that Amul has become a global brand not through venture capital, corporate mergers, or multinational management, but through the strength of ordinary farmers operating on the principle of “one member, one vote”.

IFFCO, the Indian Farmers Fertiliser Cooperative Limited, represents a different side of India’s cooperative strength. Formed in 1967, IFFCO began as a response to India’s fertiliser shortages, aiming to provide reliable, affordable fertilisers to farmers nationwide. Over time, it has grown into one of the world’s largest fertiliser producers, serving millions of farmers while remaining entirely cooperative-owned. It has consistently held the top global rank in previous years and now stands at No. 2 in the world, demonstrating sustained excellence. Unlike private firms, IFFCO does not maximise profits for shareholders; instead, it reinvests revenues to reduce input costs, improve fertiliser access, support rural projects, and strengthen soil health initiatives. It showcases how cooperatives can thrive even in capital-intensive sectors, competing with multinational corporations without abandoning their democratic ethos.

The ICA World Cooperative Monitor, which releases these rankings, is the most authoritative global analysis of cooperative performance. It evaluates organisations on economic, social, and governance indicators and uses a unique metric: turnover relative to GDP per capita. This method allows fair comparison across countries with vastly different economic sizes. The rankings therefore highlight true performance, not just absolute revenue. The success of Amul and IFFCO shows not only their size but their efficiency, sustainability, and resilience—qualities essential for twenty-first century enterprises.

Understanding this achievement requires understanding what a cooperative is. A cooperative is owned and run by its members—farmers, consumers, artisans, workers, or producers—who come together to meet a common economic or social need. Unlike corporations, cooperatives follow the principle of democratic control, where each member has one vote, irrespective of capital contribution. This ensures that wealth and power remain distributed rather than concentrated. Cooperatives reinvest surpluses in their communities, provide essential services at affordable rates, and strengthen local economies. In sectors like dairy, agriculture, and rural finance, cooperatives form the backbone of India’s inclusive growth.

Recognising the importance of cooperatives, India took a major constitutional step in 2011 through the 97th Constitutional Amendment. This amendment added the right to form cooperative societies as a fundamental right under Article 19, inserted Article 43B to guide the state in promoting cooperatives, and introduced Part IX-B (Articles 243ZH to 243ZT) to strengthen governance and autonomy. It established clear rules for elections, member rights, audits, and transparency. In short, India gave constitutional protection to a sector that directly empowers millions of rural households.

Despite their strengths, cooperatives in India face structural challenges. Weak governance has plagued many cooperatives across states, especially in credit and sugar sectors, where political interference has often disrupted operations. Access to credit remains limited for new or small cooperatives, preventing scale and professionalisation. Technological gaps further limit efficiency, as many cooperatives lack modern digital tools for accounting, supply chain management, and member services. Above all, cooperatives face stiff competition from private corporations and multinational supply chains that operate with vast capital and advanced technology.

The government has taken several steps to rejuvenate the sector. The National Cooperative Policy (2002) laid the foundation for governance reforms and member participation. The Multi-State Cooperative Societies Act (2002) strengthened oversight and enabled cooperatives operating across states to function with clarity and accountability. In 2021, the creation of the Ministry of Cooperation gave the sector dedicated national support for digitalisation, financial strengthening, and professional management. This ministry continues to push for reforms that ensure transparency, competitiveness, and self-reliance.

From an economic perspective, cooperatives play a crucial role in India’s rural growth. They enhance farmer incomes, create rural employment, reduce input costs by eliminating middlemen, help stabilise prices, and retain profits within communities. Socially, they empower women, improve bargaining power, reduce exploitation, and promote local resilience. Globally, cooperatives are recognised by the United Nations as engines of sustainable development, contributing directly to SDGs such as reducing inequality, promoting decent work, ending poverty, and ensuring responsible production.

As the Indian economy moves into its next phase of development, the future of cooperatives holds immense promise. With the right reforms, cooperatives can become powerful vehicles for rural transformation—especially in dairy, agriculture, rural credit, food processing, and supply chain logistics. Digital platforms, AI-driven operations, blockchain traceability, and modern management practices can integrate seamlessly into cooperative structures, enhancing both efficiency and transparency. At the same time, decentralised governance ensures that benefits flow to the grassroots, not to distant shareholders.

The rise of Amul and IFFCO must therefore be seen not as isolated achievements but as a milestone in India’s long tradition of collective enterprise. In a world where markets often privilege capital over community, cooperatives remind us that economic models powered by trust, democracy, and solidarity can achieve extraordinary success. They show that when millions of farmers share ownership, decision-making, and profit, they create institutions of unmatched strength and moral legitimacy.

As India stands tall in the global cooperative landscape, the achievements of Amul and IFFCO carry a profound lesson: the smallest hands, when united, can build the largest enterprises. And in that unity lies not only economic power, but dignity, equality, and a sustainable model of growth for generations to come.

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