RSS leaning cooperative body Sahakar Bharati has put several groundbreaking proposals before the Union Finance Minister and her team, consultations for which were concluded last week.
The focus of the recommendations was aimed at revitalizing the cooperative sector in India. These initiatives are designed to enhance financial inclusion and support the rural economy through various strategic reforms, said D N Thakur, President of Sahakar Bharati while talking to the Indian Cooperative.
Elaborating, Thakur said “One of the key proposals includes offering deposit insurance up to Rs 50,000 for deposits at Primary Agricultural Cooperative Societies (PACs). This measure is intended to encourage the mobilization of rural savings into the formal financial system, decreasing the PACs’ dependency on higher financing agencies. This proposal echoes the recommendations made by the Khusro Committee in the late 1980s, urging the government to revisit these suggestions.”
Additionally, he expected the budget to empower PACs to establish agro-processing units, extending them financial support akin to that provided to Farmer Producer Organizations (FPOs) and Cooperatives (FPCs).
Another significant advancement involves the digitalization of financial transactions in rural areas, with plans to establish norms for providing payment gateways to various cooperative entities, thus deepening the digital footprint in these communities.
“For District Cooperative Central Banks (DCCBs) and State Cooperative Banks (StCBs), the government is expected to release new guidelines concerning non-agricultural advances and an upward revision of limits to better meet the credit needs of the rural populace. Furthermore, a pressing need for recapitalization support has been highlighted, with many rural and agricultural cooperative banks still waiting for these funds to make necessary investments”, reads a detailed list of recommendations mailed to us.
In the housing cooperative sector, significant reforms are expected to encourage the formation of Cooperative Housing Finance Societies (CHFS), particularly in rural and semi-urban areas. These societies would be brought under the supervision of the National Housing Bank, with financial support from major institutions like LIC and HUDCO to provide small-ticket housing loans, reads the proposal.
Furthermore, the budget should address the needs of fisheries and dairy cooperatives by formulating special schemes for financing and capacity building, along with introducing insurance covers and concessional interest rates for loans, claimed Sahakar Bharati leader.
Overall, the Union Budget for 2024-25 should aim to create a supportive environment for cooperatives across various sectors, enhancing their capacity to contribute to India’s rural economy and promoting sustainable development through cooperative enterprises.
These measures would reflect the government’s commitment to leveraging the cooperative sector as a key driver of economic growth and stability, concluded Thakur.