Explained: What is NCDC (Amendment) Bill 2026 & what it proposes to change?

The Centre has proposed changes to the law governing NCDC, seeking to give the institution greater flexibility in supporting co-operative development

Minister of State for Civil Aviation and Cooperation Murlidhar Mohol introduced the National Co-operative Development Corporation (Amendment) Bill, 2026 in the Lok Sabha on Monday. The Bill seeks to widen the role of the National Co-operative Development Corporation (NCDC) and make it easier for the corporation to provide financial support to the cooperative sector.

 

The proposed changes aim to give NCDC more flexibility to work with entities that support cooperative development, while keeping cooperative societies as the primary beneficiaries.

 

What is NCDC?

 

The National Cooperative Development Corporation (NCDC) is a statutory organisation under the Ministry of Cooperation. It was established in 1963 under the National Co-operative Development Corporation Act, 1962.

 

Its existing role includes planning, promoting and financing programmes related to the production, processing, marketing, storage and export-import of agricultural produce, foodstuffs and other notified commodities, primarily through cooperative societies.

 

The 1962 law has been amended several times, including in 1973, 1974 and 2002, to expand NCDC's activities and allow direct financing of eligible cooperative societies.

 

Why does the government want to amend the law?

 

The government says the cooperative sector has expanded and diversified significantly. Alongside cooperative societies, statutory bodies, state government agencies and specialised entities now provide "infrastructure, technology, processing, marketing, financial and other services" for cooperative development.

 

However, many of these entities are not registered as cooperative societies. Under the existing framework, NCDC cannot directly finance them even when their work benefits the cooperative sector.

 

The government says this can result in proposals having to be routed through state governments or cooperative societies, leading to delays and limited uptake.

 

So, the Bill seeks to change NCDC's mandate from planning and promoting programmes “through co-operative societies” to planning, promoting and financing programmes “for co-operative development”.

 

Major proposed changes

 

One of the key changes is a new definition of “co-operative development”. The Bill defines it as: “planning, promoting and financing programmes, whether directly or through any intermediary entity, to co-operative societies”.

 

This would allow NCDC to work through entities other than cooperative societies when the ultimate purpose is to support the cooperative sector.

 

The Bill also proposes to allow NCDC to provide loans and grants directly to cooperative societies. The proposed provision says NCDC may “provide loans and grants directly to co-operative societies or any entity engaged in co-operative development to the extent such funds are used for co-operative societies”.

 

Such assistance would be subject to security requirements set by the corporation.

 

Can NCDC invest in cooperatives?

 

Yes. The Bill proposes to give NCDC the power, with the approval of the central government, to participate in the share capital of cooperative societies and entities engaged in cooperative development.

 

The provision states that the corporation may, with government approval, “participate in the share capital” of eligible cooperative societies or entities involved in cooperative development.

 

The government has clarified that cooperative societies will continue to remain the primary beneficiaries.

 

What other areas will be expanded?

 

The Bill proposes changes to the commodities and activities covered by NCDC's mandate.

 

It seeks to expand the definition of “foodstuffs” to include processed food, other edible products and any other food items that may be notified by the central government.

 

It also proposes to remove the existing "geographical restriction" on industrial goods. This would allow NCDC assistance for industrial goods-related activities irrespective of their location.

 

The Bill further updates references to the Multi-State Co-operative Societies Act, replacing the reference to the 1984 law with the Multi-State Co-operative Societies Act, 2002.

 

Will NCDC get new powers?

 

The Bill proposes two new provisions.

 

First, a new Section 9A would give NCDC incidental powers to do things necessary for exercising its powers and performing its functions under the law. It states, “The corporation may do all such things as may be necessary or incidental to or consequential upon the exercise of its powers, discharge of its functions and the performance of its duties”.

 

Second, a new Section 13A would allow NCDC to collect or furnish credit information and other information to the central government, the Reserve Bank of India, banks and other financial institutions notified by the government.

 

The government says this would help the corporation discharge its functions more efficiently. 

 

What happens to state governments' role?

 

The Bill states that the NCDC would continue to provide funds to state governments for financing cooperative societies. However, the proposed amendment would also allow funds to be provided for financing entities engaged in cooperative development, to the extent that the funds are used for cooperative societies.

 

Why is the government bringing this change now?

 

The government has linked the proposed changes to the expansion of the cooperative sector and the creation of the separate Ministry of Cooperation in July 2021. It says initiatives under the government's “Sahakar se Samriddhi” vision have increased NCDC's role in cooperative development.

 

The government states that the existing legal framework does not provide enough flexibility to respond to the sector's changing requirements. Therefore, the Bill aims to provide “greater flexibility and legal clarity”, facilitate timely and direct financial assistance and help NCDC respond to emerging needs in the cooperative sector.

 

The Bill's Financial Memorandum says that if enacted, it “would not involve any expenditure either recurring or non-recurring from the Consolidated Fund of India".