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The Father of the Nation Mahatma Gandhiji has given the Message that the Co-operative is the gateway for the economic independence.

The Karnataka, Co-operative movement is closely connected with socio-economic activities of the rural and urban population. It plays an important role in the socio-economic progress of the people.

Co-operative Movement encompasses in itself quite a few developmental sectors like credit, marketing, consumers, silk industry, dairy, fishery, horticultural, sugar, house building, construction of godowns etc.,

The Department of Co-operation functions in close Co-operation and co-ordination with various other connected departments for the implementation of Socio Economic plans and schemes.

In Karnataka the first co-operative society was registered in 1904 at Bangalore and the first agricultural credit co-operative society was registered in the year 1905 in Kanaginahal village of Gadag District. Since then Karnataka has made rapid strides in co-operative development and now occupies third place next to Maharastra & Gujarat.

The Department of Co-operation oversees the administration and functioning of various co-operative institutions, namely Textiles, Sericultural, industries, Animal Husbandry, Fisheries, Sugar, Horticulture, Agriculture and Irrigation Departments also assists the societies financially besides providing technical financially besides providing technical guidance and input.

The Co-operative Institutions in Karnataka may be categorized into five sectors:

1. Co-operative Credit Sector: -
	(a) Agricultural Credit Sector ST/MT: The K.S.C Apex Bank, District Credit Co-operative Banks and Primary Agriculture Credit societies are engaged in providing short term and medium term loans to the farmers. 2. Co-operative Marketing Sector:- The co-operative marketing sector is engaged in the marketing the agricultural produces. The Karnataka State Co-operative Marketing Federation Ltd. Bangalore is the premier institution and is engage in marketing and supply of fertilizers, seeds and pesticides.
	(b) Agricultural credit sector LT : There re 177 PCARDBS at taluka level & KSCARDB at States level to meet the long term credit requirements of the farmers.
	(c) Non-agricultural credit sector : These are mainly urban credit societies, employees credit societies & urban co-operative banks, which provide non agricultural credit to their members for various purposes like housing, industrial, consumption etc.,

2. Co-operative Marketing Sector :

The co-operative marketing sector is engaged in the marketing of the agricultural produce. The Karnataka State Co-operative Marketing Federation Ltd., Bangalore and 179 taluka agricultural produce co-operative marketing societies at taluka level are engaged in marketing and supply of inputs such as fertilizers, seeds and pesticides and agricultural implements to the farmers. They also arrange for marketing the agricultural produces of the farmers in the state. There are commodity wise marketing societies also like MAMPCP Shimoga, Totagars Co-operative societies in Sirsi, CAMPCO in Mangalore etc.,

3. Co-operative Processing Sector :- The co-operative institutions functioning as processing units:

	Cooperative Sugar factories.
	Cooperative spinning mills.
	Cooperative Oil extracting mills.
	Arecanut processing societies.
	Coffee processing societies.
	Rice and dal mills etc.
	Cotton ginning & pressing units.
	Fruit processing units.

4. Milk Processing Institutions:
For processing and marketing of milk and milk products, Karnataka Co-operative Milk producing federation (KMF), 13 District Level Co-operative Milk Unions and 7909 MPCS milk producers co-operative societies have been established. They have succeeded in transforming the rural economy to a very great extent.

5. Co-operative Service Sector :
The institutions include Primary consumer cooperatives, Central cooperative wholesale stores and the KCCF. The consumer societies have helped to hold the price wise into their respective areas.

Karnataka is one of the states in India , which has achieved commendable progress in the Co-operative sector. The Co-operative societies of our State have the target of advancing 1700 Crores of short term, medium & long term agricultural loans during the year 2004-05. There are a total number of 31,908 Co-operative societies as on 31.03.2003 in the State of Karnataka and the total membership of these Co-operatives is about Rs. 1.86 Crores, Out of these 26,000 Co-operatives are actively working towards the economic development of their members in the Karnataka State. The total working capital of these Co-operatives is about Rs.22654.21 Crores. More than fifty percent of the Co-operatives are earning reasonable profit.