Bhagwati Prasad, the former Chief Executive of National Cooperative Union of India has been awarded  PHD  by Guru Jambheshwar University of Science and Technology, Hisar, Haryana.

Mr Prasad who is presently Vice-Chairman of Sahkari Awas Nirman Evam Vitt Nigam Ltd in Lucknow submitted his research work on topic of ” Management of Primary Health Care Services-  a  case study of Haryana”.

Mr Prasad had a long inning in the cooperative circle of  Delhi and presently working together with Shri Mukul Verma who is the Chairman of above-mentioned Cooperative Federation and a member of Governing Council of NCUI.

There are differences between TV Network and news portal. For example, News portals could be interactive in a manner TV or Newspaper could barely imagine.

We at Indian Cooperative.com, have decided to use this means of interaction to find out the opinions of our readers on issues facing the cooperative sector in the country.

In the effort to be truly interactive Indian Cooperative.com has begun the exercise by asking questions in Surveys and announcing their results to the readers.  We did a poll on whether Nafed should be taken over by the government or not. The results were interesting.

Majority of people surveyed favour the  governmental take-over of Nafed- the agri-cooperative which was the  pride of the Cooperative Movement.

A whopping 66 percent of the respondents felt that the cooperative structure of the giant agricultural federation has not been fair to its members and it should be controlled by the government.

But a good 34 percent of the respondents oppose the governmental interference and still repose their trust  in the existing  model for the agri-cooperative.

The difference between 66% and 34% percent is substantial but not as substantial as 90% vs 10%. It means a good many people still show confidence in the cooperative leadership despite the open loot indulged in by some board members in collusion with officials of Nafed.

It bears recall the court of Central registrar had issued recovery orders to many of the then board members and officials including the  son and wife of late Ajit Singh during whose Chairmanship the loot took place.

The matter is pending in the court of Additional Secretary, Ministry of agriculture where majority of the accused have appealed against the Central registrar order.

Indian cooperative has gathered that majority of the people named by the Central Registrar were not aware of the blatant loot being indulged in by a few. The leaders are generally careless towards the Board meetings and put their signatures in their good faith and without applying their minds.

The Nafed episode is a wake–up call for those cooperative leaders who are suffering today not because of their involvement in the wrongdoings but because of their carelessness.

The cooperative banks play a big role in the Indian economy as they are based on the small amount of money collected from the ordinary people. They tend to cater to the poor.

Moreover, the cooperative banks help those  who cannot avail themselves of the services provided by  the nationalized banks, said Manmohan Goyal Chairman of the Vaish Cooperative Commercial Bank while talking to the Indiancooperative.com  correspondent here today in Delhi.

The govt of India should give tax concessions to the cooperative banks as the excessive tax burdens imposed on them reduce their deposits as well as profits.  Besides, the cooperative banks could not issue Demand Draft and multi-state cheques. All this detracts from their ability to increase their customers and deposits, Mr Goyal added.

Mr Goyal urged the RBI to bring in such policies as may enable the cooperative banks to provide even the poor people with necessary funds.

Chairman of Vaish Bank  Mr Goyal claimed that his bank offers unsecured loan to the tune of 50 thousand and secured loan to the tune of 35 lakh. The Vaish Cooperative bank gives loan only to those of the members who have invested some share money.

Established in 1939, the bank was trifurcated. Presently, the bank is known as the Vaish Cooperative bank. The bank has only one branch but it is planning to open new branches. It has 6 thousand members and share-holders. Its annual turnover works out to Rs 22 crore and it notches up a little less than 3 lakh in profits.

According to Mr Goyal, the RBI has never imposed any penalty on  the bank. The bank enjoys good ties with NAFCUB and other cooperative organizations.

The  cooperative circles in Orissa are in jitters  as  the Supreme Court has stayed the Orissa high court order quashing the  state govt nominated councils  for managing the cooperative banks in the state. The latter had earlier challenged the high court order in the apex court.

It is noteworthy that Orissa govt had  constituted its own councils for managing the cooperative banks as it was not happy with the way the so-called elected councils were running them.

However, the cooperative banks had opposed the govt move and got the govt nominated councils quashed by the Orissa high court.

While staying the high court verdict, the apex court asked the cooperative organizations to present their case for the final settlement of the matter.

In the meantime following the Supreme Court order, the state govt nominated councils would   begin managing the cooperative organisations in the state and the elected councils of these organisations would stand invalidated.

There are unmistakable indications that the Orissa govt is bent on controlling the lever of power of the cooperative sector in the state. It already has shown its determination to do so by enforcing the Orissa cooperative societies act, 2011.

A record production of paddy in Bihar has pushed the state govt into undertaking a major procurement drive. The target is to procure about 30 lakh mt paddy during the Kharif season.

The govt has pressed various agencies into service procuring paddy from the farmers. The most remarkable aspect of the exercise is an important role being played by the cooperative organizations in it.

There are nearly 7 thousand Primary Agricultural Societies (PACs) involved in the procurement drive. The work being put in by them has widely been appreciated.

Bihar minister for Food and Supplies Mr Shyam Rajak has expressed satisfaction at the fact that the current procurement drive mainly powered by the cooperatives has already cut the ground from under the middlemen’s feet.

Once again, the Supreme Court has ordered the Noida Development Authority to provide banks including the cooperative banks located in residential areas with space so as to enable them to relocate soon.

The court has given six weeks’ time for the relocation.

However, V K Sharma CEO Noble Cooperative Bank and Prem Mishra of Citizen Coop Bank consider the time limit fixed by the court inadequate as the relocation is a complicated business involving countless formalities.

Additionally, in their view banks should be provided with furnished ready to move in places rather than just spaces for the relocation.

Their banks are not realtors and if treated as such their shifting would become well-nigh impossible, they said to Indian Cooperative.com.

They are optimistic nevertheless and hope that the Noida Authority would soon take necessary steps to implement the Supreme Court order.

At least for once the cooperative body celebrations would be based on the strength of common man and not on the strength of hired crowd. International year of Cooperative 2012 is being taken by NCUI and others quite seriously and marches, races and other visible activities involving common people are being planned.

Indiancooperative.com is happy to note that the movement is coming out of conferences and seminars which are notoriously attended by hired crowd and constant set of people.

Cooperative movement has to involve common man and IYC 2012 is unique chance to popularize the movement.

All possible preparations are already underway for the celebration of the international year of the cooperatives,  we are putting in our best efforts in conjunction with various cooperative organisations  to make it  a grand success, said Dr Dinesh,Chief Executive of NCUI in an interview with the indiancoop.com correspondent here today in the capital.

NCUI recently organised a meeting of cooperative organisations  to discuss   preparations in progress  for the celebration of the IYC 2012. All the leading cooperative organisations including IFFCO, KRIBHCO NCDC, NAFCUB, FISHCOFED, Sugar Federation etc attended the meeting, Dr Dinesh added.

According to Dr Dinesh, most of the cooperative organisations have promised to organise special activities during the IYC and give the IYC a particular mention in their advertisements. NCDC for example, suggested a march from India gate to Rastrapati Bhawan be undertaken  to  popularize the IYC among the common people.

The cooperative organisations are extremely enthusiastic about the IYC and using the IYC logo in all their projects and activities. Some organisations are still working on various ideas and plans for the IYC and will soon send them to NCUI for consideration. Some cooperative organisations are planning to hold competitions and contests.

There are also plans to organise workshops and seminars on various issues during the year. One such workshop will be held on the ecological issues, Dr Dinesh added.

Dr Dinesh informed that special efforts would be made to organise publicity for the IYC 2012 and print media, electronic media and air and Doordarshan will be  used  for the purpose. Several ministries of the govt of India including the ministry of finance and the ministry of agriculture will lend their support to the publicity campaign.

National Bank for Agricultural and Rural Development (NABARD) has decided to work out  a  common technological arrangement  that will cover nearly 150 state and central cooperative  banks  in various states including Maharashtra.

According to the NABARD sources, this will not only streamline the credit extension process but also greatly boost financial inclusion in the country.

Nearly 5 thousand branches of banks and their administrative offices will be able to share data and knowledge through the common network.

It is in this context that NABARD has signed an agreement with the IT major WIPRO. The NABARD officials say the agreement for the provision of the state of the art computer facilities will bring about a considerable improvement in the functioning of the cooperative banks.

Batting for milk samples including Amul Delhi Chief Minister Sheila Dixit government vouched for their purity in the court.

Readers may recall a Delhi High court observation in which taking suo motu cognizance of a survey court had sought response from the Centre and Delhi State.

Talking to Indian cooperative.com GCMMF Managing Director R S Sodhi told that Amul milk follows all the prescribed standards and we are a brand name because of our reliability.

In a similar vein Delhi govt told court that all the leading brands such as Amul, Paras and Mother dairy are safe as they do not contain any injurious material.

It also said that out of 70 lakh liters of milk consumed by the city more than 90 percent are in packaged form ruling out fear of adulteration.

Many persons approach the office of Indiancooperative.com to find out what is happening on the fronts of granting licence to Urban Cooperative Banks. We decided to find out the truth from horse’s mouth.

Mr Mukund Abhyankar, Member of the Malegam Committee which was entrusted with the job of doing a threadbare analysis of issues and suggest recommendations for the grant of licence was kind enough to have consented for an interview.

Mr Abhyankar is a renowned cooperative leader of Pune who has made his presence felt across the cooperative world of the country. Having been Chairman of Cosmos Bank a number of times in the past he is still one of its directors. Cosmos Bank is number two in the UCBs ranking after the Saraswat Bank

We produce below the excerpts

Q : When are the recommendations of the  Malegam report to be translated into action? In short, at what stage the report exists presently.

A:  As per rules and practices, recommendations of every committee appointed by the RBI are submitted to the  RBI for further action. About the Malegam Committee also, its final report has already been submitted to the RBI on 18^th August, 2011 by the Chairman of the Committee.

The RBI must now be considering it and hopefully within a couple of months should come out about accepting / not accepting, partly or fully, the report. I, as a member of the Committee, am not supposed to say anything about this. Naturally, I am unable to tell you at ‘what stage the report exists presently’.

Q    It talks of BoM. Will it not interfere with BoD? Or would having two centers of power cause inconvenience for the working of the bank?

A:     The BOM will certainly not interfere with the BoD. There will not be two centers of power causing inconvenience whatsoever for the working of a co-operative bank. This is how both are going to work.

Constitution (eligibility, election, tenure, cessation, etc) of the Board of Directors is and shall remain under regulation and control of the respective Registrars of Co-op. Societies (and in turn vide respective Co-operative Society’s Acts).

The appointment of member of the Board of Management is to be made by the above Board of Directors vide eligibility criteria prescribed from time to time by the  RBI. If the elected members on the Board of Directors are fulfilling such eligibility criteria, then all such members can simultaneously be members of the Board of Management. In effect, both appointment and removal of the Board of

Management members is the authority of the Board of Directors.

The Board of Directors shall frame the policies in all respects to be thereafter implemented by the Board of Management. In other words, the day-to-day functioning of the UCB through the CEO shall vest in the Board of Management. The Board of Management can never over-ride or flout the Codes and Policies fixed by the Board of Directors.

In this manner the Board of Management can never interfere with the Board of Directors but can work harmoniously. In other words, the Board of Management should be seen and taken as a sub-committee of the Board of Directors and can have  insiders if they fulfill the eligibility criteria.

Q   Clarity regarding constitution of BoM such as “could the directors of Board be member of BoM”? Would the existing chairman continue to have influence on their bank as they had in the past?

A: Clarity regarding ‘could the Director of the Board be a member of BOM’ is already explained in my reply to Question No. 2 above.

Q  According to the report each bank needs to have a cooperative society. And there would be two entities society and bank. How easy or difficult would it prove for the existing banks?

A: The report has nowhere stated that “each bank needs to have a co-operative society”. Therefore further doubt about the two entities – society and bank – and also about difficulties feared by the existing banks does not arise at all.

Q  Clarity regarding Umbrella Organisation of UCBs. Would it be created within the RBI or would be a separate entity controlled by the RBI or it would be entirely an autonomous body?*

A: Umbrella Organisation shall be a co-operative society registered under the Multi-State Co-operative Societies Act, 2002 of the Government of India. Even though the Malegam Committee recommendations regarding the Umbrella Organisation if accepted by the RBI, suitable amendments in the Banking Regulation Act 1948 will have to be made, which shall be the duty of the RBI and the Government of India.

All the non-scheduled urban co-operative banks in India (at present more than 1600 in number) shall be the compulsory members of this Umbrella Organisation. This Umbrella Organisation which shall be a bank at the national level shall be the only organisation for the entire country and there shall be no state level other organisations discharging the banking functions.

The main functions of this Umbrella Organisation are narrated in the report. Briefly, it can be said that providing temporary liquidity to the member UCBs shall be the main function of this Umbrella Organisation.  The funds required for providing temporary liquidity shall be mobilised from member UCBs who shall be permitted to keep their CRRs with this Umbrella Organisation bank.

As recommended in the report, this Umbrella Organisation shall have an elected Board of Directors (as required under its own bye-laws to be registered with the Central Registrar of Co-operative Societies). It shall also have a Board of Management to look after the day-to-day banking business.

Therefore as asked in the question, it will not at all be created within the RBI. On the other hand, it would be a separate autonomous body but being a bank will be controlled  and regulated by RBI under the provisions of Banking Regulation Act, 1948. Therefore the doubt whether it will be created within the RBI will not be proper.

Q  Do you see getting licence would be tough/easy compared to the past after the recommendations are accepted?

A:  Getting a license for new UCB will not at all be tough if the new UCB wants to commence its business in unbanked/low banked areas. However if it wants to operate in the metropolitan or partly populated urban areas, A & B then it will have to raise additional share capital as prescribed by Entry Point Norms.

This is because the Malegam Committee has recommended that the new UCBs should come mostly in unbanked/ low banked areas instead of adding to the already overbanked areas.