From UPSC perspective, the following things are important :
Prelims level : National Export Co-operative Society
Mains level : Not Much
The first consignment expected to be exported by the first-ever National Export Co-operative Society.
Why in news?
- The Union Cabinet on January 11 approved the setting up Multi-State Seed Society, Multi-State Organic Society and Multi State Export Society.
What is National Export Co-operative Society (NECS)?
- The society will have an authorised share capital of ₹2,000 crore with the area of operation all over the country.
- It will be registered under the Multi-State Cooperative Societies (MSCS) Act, 2002.
- It will have its registered office in Delhi.
- The Society’s registration will be complete in the next few days and the first consignment will be exported in three months.
- It will work as an export house for handicrafts, handlooms, khadi and other products, ensuring enhancement of income of the cooperative member entrepreneurs.
Funding of NECS
- Leading cooperatives like IFFCO, KRIBHCO, NAFED, Amul and National Cooperative Development Corporation (NCDC) will be the promoters of the Society.
- They will contribute ₹100 crore each.
Working of NECS
- The Society will be different from the Export Promotion Council under the Ministry of Commerce.
- This Society will provide end-to-end services to the cooperatives.
- It will open foreign bank accounts and complete all the formalities, including necessary permissions for exporting a product.
- The dividends will be shared with the manufacturer instantly and without any brokerage fee.
- The Society will hire consultants in foreign countries who will help expand its footprint across continents.
Why need cooperatives for export promotion?
- Cooperatives contribute 28.80% in fertilizer production, 35% in fertilizer distribution, 30.60% in sugar production and 17.50% in milk in the national economy.
- However, their contribution to exports is negligible.
- Society will benefit the smallest of farmer or artisan who has a good product but does not have access to the right platform.
- Through this Society, they will get access to international market and good returns too.
- Once a product has been tested for international standards, the packaging and export will be done by the Society.