Agricultural cooperatives play an important role in improving farmers’ access to inputs, credit, markets, storage, processing, and technical services. In Bihar, where agriculture remains a major source of employment and rural income, government policy has substantially influenced the formation, operation, and performance of cooperative institutions. This paper examines the impact of government policies on the growth and development of agricultural cooperatives in Bihar. It focuses on cooperative legislation, credit policies, procurement initiatives, rural infrastructure, digitization, farmer-producer organizations, and the integration of Primary Agricultural Credit Societies with broader agricultural services. The analysis indicates that government interventions have expanded the institutional reach of cooperatives and improved access to formal finance, agricultural inputs, public procurement, and storage facilities. However, the impact remains uneven because of weak governance, limited professional management, inadequate infrastructure, delayed payments, political interference, small operational scale, and regional disparities. The study argues that policy effectiveness depends not only on financial support but also on institutional autonomy, transparency, market integration, capacity building, and reliable data systems. It concludes with policy recommendations for strengthening democratic governance, improving cooperative business models, promoting value addition, and integrating cooperatives with digital agricultural markets.