Govt to amend Co-operative Act
The Maharashtra govt has finally swung into action and is set to amend the State Co-operative Act, 1960.
By TNN |
After sitting on the proposed reforms in the state co-operative sector for almost a year, the Maharashtra government has finally swung into action and is set to amend the State Co-operative Act, 1960.
The state Cabinet, at its meeting on Thursday, decided to move amendments to the Act which will facilitate central grant of around Rs 1,800 crore for more than 20,500 primary agriculture credit societies (PACs) in the state under a major revival and modernisation programme.
As reported by ET earlier this week, the state’s tardy progress on implementation of the revival package as recommended by the Vaidyanathan committee had received much flak from various quarters. The government had signed an MoU with Nabard on implementing the revival programme in November 2006, but the issue of amendments to the Co-operative Act was holding it up.
The amendments, if passed, would ensure fundamental changes to the rules governing the co-operative institutions. Depositors and debtors would have a right to vote in all PACs except for co-operative banks. PACs, district co-operative banks and the apex Maharashtra State Co-operative Bank would be given autonomy in financial and administrative matters.
Also, all PACs can make investments as per RBI directions and the state government will not have any right to interfere here. Similarly, co-operative institutions will be allowed to seek loan from any lending institution, as per RBI guidelines.
It had become all the more important to introduce reforms as most of the co-operative institutions in the state are controlled by political bigwigs belonging to the Congress and the NCP. “Co-operative institutions are the backbone of rural economy and agriculture.
It’s necessary that they adopt standards of fiscal discipline, transparency and accountability to be able to expand the coverage of formal credit in the agriculture sector and not become fiefdoms of political patrons,” an official said.
The state Cabinet, at its meeting on Thursday, decided to move amendments to the Act which will facilitate central grant of around Rs 1,800 crore for more than 20,500 primary agriculture credit societies (PACs) in the state under a major revival and modernisation programme.
As reported by ET earlier this week, the state’s tardy progress on implementation of the revival package as recommended by the Vaidyanathan committee had received much flak from various quarters. The government had signed an MoU with Nabard on implementing the revival programme in November 2006, but the issue of amendments to the Co-operative Act was holding it up.
The amendments, if passed, would ensure fundamental changes to the rules governing the co-operative institutions. Depositors and debtors would have a right to vote in all PACs except for co-operative banks. PACs, district co-operative banks and the apex Maharashtra State Co-operative Bank would be given autonomy in financial and administrative matters.
Also, all PACs can make investments as per RBI directions and the state government will not have any right to interfere here. Similarly, co-operative institutions will be allowed to seek loan from any lending institution, as per RBI guidelines.
It had become all the more important to introduce reforms as most of the co-operative institutions in the state are controlled by political bigwigs belonging to the Congress and the NCP. “Co-operative institutions are the backbone of rural economy and agriculture.
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It’s necessary that they adopt standards of fiscal discipline, transparency and accountability to be able to expand the coverage of formal credit in the agriculture sector and not become fiefdoms of political patrons,” an official said.
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