Rise and fall of a cooperative dream
IN BAD TIMES Delhi’s consumer cooperative stores are struggling to survive. Till the early 1990s, there were over 600 such stores but most of them have now shut shop, including the oncebustling Super Bazar. Only about 35 are presently active.
NEW DELHI : The front signage of a small, nondescript store at Kalgidhar Gurdwara Market in Uttam Nagar announces in big, bold letters: ‘Custom Shop’. Inside, there are shelves filled with shirts, shoes, suitcases, perfumes and an assortment of other consumer goods. But none of the items on sale has anything to do with the customs. The ‘custom shop’ is actually Priya Consumer Cooperative Store— mentioned in a very small, almost unreadable, font on its signage.
In the free-market economy, not just Priya but most primary consumer cooperative stores across the city—essentially community-driven businesses —like to call themselves ‘custom shops’ to attract customers that have drifted to malls and department stores over the years. Until the 1990s, these consumer cooperatives stores were the go-to places not just for grocery but also for the coveted Japanese VCR or French perfumes. That was because the government sold foreign goods confiscated by the Customs department through consumer cooperatives.
“We depended on the government for the supply of grocery and confiscated goods. Now it supplies to us only when the prices of essential food items begin to pinch the people, creating a political furore,” says Shyam Sunder, a salesman, sitting at the counter of the shop, which has seen better days. “A lot of old-timers come to us looking to buy pulses, rice and spices at subsidised rates. But the new generation does not know what the consumer cooperative stores are all about.”
Delhi’s consumer cooperative culture, which got a big boost in the 1960s after the wars with China and Pakistan—what with the government promoting them to ensure adequate supply of essential food items—is struggling to survive. Till the early 1990s, the city had over 600 primary consumer cooperative stores.
Most are now defunct, non-functional or under liquidation.
According to the Delhi State Consum- ers Cooperative Federation (DSCCF), the apex body of consumer cooperative societies in Delhi, only about 35 stores are active in retailing. “Most survived on government patronage in the form of funds, subsidies and supply support. The market economy in the post-liberalisation era ended that and the cooperative stores could not cope,” says TT Adhikari, managing director, DSCCF.
The federation presently has 25 primary consumer cooperatives as members. The custom-seized goods, he says, were a major draw. “But post-liberalisation, every foreign brand arrived in India and imported items lost their lure, and cooperative stores their customers,” says Adhikari.
“Now we have to buy everything from the market and are unable to offer discounts and compete with the department stores and hypermarkets that have mushroomed everywhere,” says Vinay Gupta, secretary, Swastik Consumer Cooperative Store in Rohini. The only grocery items at the store are a few sacks of flour. “People came to us for subsidised grocery and confiscated imported goods. We used to get most of our supplies from the National Cooperative Consumers’ Federation (NCCF). Not anymore,” says Gupta.
Headquartered in the Capital, NCCF, the top body of consumer cooperatives in the country, has the mandate to promote consumer cooperative movement in India. Presently, it has about 148 members that include state consumer cooperative federations, primary and wholesale consumer cooperatives. ”We ourselves are not getting adequate supply from the central government, so we cannot help primary consumer stores,” says a senior NCCF functionary not wishing to be named. “The government has lost interest in cooperatives, but now we are trying to be self-sustainable to provide supply support to consumer cooperatives across the country.”
Nothing exemplifies the fall in the fortunes of consumer cooperatives in Delhi than the demise of Delhi’s Super Bazar, once a lifeline of Delhiites. Launched in 1966 after the Indo-pak war, it was India’s biggest cooperative department store chain with over 2,200 employees and over 150 branches and mobile vans across Delhi. After its closure in 2002, many attempts were made to revive it. In 2009, it was handed over to a private company after it won a bid, agreeing to pay ₹504 crore for its revival under a Supreme Court-monitored process.
The company started operations from part of the ground floor but eventually could not come up with a revival plan and in 2016, the apex court ordered Super Bazar’s liquidation. “Corruption and mismanagement at the highest level led to its demise,” says Surya Narain Shukla, who is sitting on a dharna outside Super Bazar in Connaught Place, demanding salary dues of the employees.
The Super Bazar cooperative, which boasted about 40,000 members, including the central government, which held 73%shares, had been making nominal profits till the early 1970s. Things took a bad turn in the mid-nineties—its losses escalated from ₹68 lakh in 1996-97 to ₹6 crore in 2000-2001.
Some of the ills that afflicted Super Bazar, the insiders say, included political interference, employee strength, which was four times the requisite number and work culture marked by unionism (there were as many as five workers unions). “Delhi lost an important part of its history when Super Bazar shut shop. Delhiites went to Super Bazar to buy grocery and household goods at deep discounts. In fact, there were often long queues outside its branches. You had to get a recommendation if you wanted to buy things like desi ghee in bulk for weddings,” says Sumit Sharma, 55, a teacher.
But not all cooperatives in the city where the government is a majority shareholder are failures. Kendriya Bhandar (Central Government Employees Cooperative Society), which opened its first branch in 1963 at Raisina Road, today has over 100 branches across the city, mostly in government colonies.
On a hot May afternoon, the Kendriya Bhandar at RK Puram sector 6, is packed with customers and not all are government employees.
“I like the old-world charm of this place. I have been buying all my grocery from Kendriya Bhandar for the past four decades; they remind me of a socialist welfare state,” says Dr Rajesh Gupta, 71, who lives in Vasant Kunj as he picks packets of sugar from the iron shelves that line the store walls. “I think if run efficiently, even in this market economy, consumer cooperatives can play an important role by making essential food items available to the poor at a reasonable rate without suffering losses.”
Kendriya Bhandar has over 92,000 members, including the central government, which holds almost 70% shares. It is operated under the administrative control of the Department of Personnel and Training. It achieved a turnover of ₹1,020 crore during the 2015-16 fiscal with a net profit of ₹6.61 crore.
In many countries such as Japan, consumer cooperative stores are community-owned business. In India, the government, either state or central, is a majority shareholder in most major cooperatives. Another example is the Delhi Consumer’s Cooperative Wholesale Store (DCCWS) where the Delhi government owns about 95% shares. Set up in 1962, it once supplied grocery and consumer goods to over 400 affiliated primary stores. Today, a large part of its income comes from 72 IMFL (Indian Made foreign liquor) shops it runs across the city. The store, headed by a government-appointed administrator, also runs a chain of seven grocery stores called Apna Bazar, which it renovated three months ago. “The idea is to attract more customers and boost our sales. We are also offering free home delivery now,” says Bijender Singh Mann, a manager at DCCWS.
But many like TT Adhikari feel that a cooperative store should be communityowned business run according to cooperative principles — voluntary and open membership, democratic member control, members’ economic participation, autonomy and independence, and concern for community. “The biggest problem the consumer cooperative movement is facing in India is the absence of leadership,” he says.
For the past couple of years, the Delhi State Cooperative Union, an apex body of all cooperatives in Delhi, has demanded that the government should promote cooperative stores in schools and colleges. “In these times of fancy malls and hypermarkets, many youngsters do not know about the existence or role of cooperatives. The government should promote student-run cooperative stores in schools and colleges so that a whole new leadership is created,” said PM Sharma, general secretary of the union.