Jammu and Kashmir weak cooperative financial institutions

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Jammu and Kashmir weak cooperative financial institutions

RB Suri

4/17/2018 11:02:28 PM

The sorry state of affairs in the cooperative institutions in the state of Jammu and Kashmir these days is a matter of concern for all of us. Prior to 1990s, the 'Cooperative Structure' was good enough but now it has become a liability rather a deformed and defunct one. It was declined particularly during the National Conference Rule in the state. One should not forget about its achieve in the state in the past. But with the passage of time it went on ruined by the successive State Governments. Due care was not taken at all by the State Government and rather allowed it go beyond its control. For taking the undue benefits from it, various politicians who remained in power in the state gave unnecessary intervention in the affairs of the various institutions which fall within the ambit of the 'Cooperative Structure' in the state. Sorry to comment upon that the concerned ministers who remained at the affairs adjusted / appointed their nears and dears in the cooperative institution without applying their minds properly as there was no specific need of the same as also financial health of these institutions was not good at all resulting which they all became under RED. This aspect has tarnished the very image of the cooperative institutions. When the Cooperative Movement in the state of Jammu and Kashmir was good followings were the Prominent Cooperators -Ch. Fateh Mohamed Ex- MLC, Babu Jatinder Dev Ex-MLC, Mohammed Ayub Khan Ex- Minister, Avinash Kapoor Ex- Secretary, JCC Bank, A.A Zargar, Ex- Minister, Sain Dass Gupta Ex- MLC, Ch. Chuni Lal, Ex-MLA, Th. Rajinder Singh Ex- MLC and many others. These Cooperative stalwarts had contributed much for the furtherance of the Cooperative Movement in the state of Jammu and Kashmir. There are three Cental Cooperative banks working in the state These are - Jammu Central cooperative Bank, Anantnag Central cooperative Bank and Baramulla Central cooperative Bank. Earlier, these were declared by the NABARD as the Weak Banks and now since they were not going in according with the stipulations as per the Banking Regulations Act, they are delicenced by the Reserve Bank of India since more than two to three years or so because their liquidity position was bad enough. Though they are working in the field of Banking but with certain restrictions imposed by the RBI / NABARD. For the revival and rejuvenation of these banks, a provision of more than 250 crores of rupees has been kept in the current year Financial Budget of the state. After every year or so NABARD usually conducts the Statutory inspections of these CCBs. After release of the same they will be getting the decadron for thei continuance in the field of banking sector. Their creation was made for the financing of the three tiers of the Cooperatives i.e. Primary Cooperatives Societies (PACS), Cooperative Marketing Societies (CMS) and the Apex Societies like JAKFED and CONFED. JAKFED is very much in the field of doing something for the farmers and in the past, it met with the large scale embezzlements and misappropriations affecting its financial structure to the large extent but CONFED due to its malfunctioning, is under liquidation process at the moment whereas the PACS and CMS are so weak that these are not in a position to render any effective support to the farming community of the state which is unfortunate indeed. CCBs are doing the Agricultural business besides the commercial business also. The State Cooperative Bank based at Srinagar being the Apex Bank to finance the CCBs after availing of the Concessional finance from NABARD at the concessional rates of interests. Its financial position is reported to be good. Apart from the CCBs, Urban Cooperative Banks (UCBs) are also in the banking field but they are doing the commercial banking. They are - Devika Urban Cooperative Bank Udhampur, Citizens Cooperative Bank Jammu and Mercantile Cooperative Bank in Srinagar with a net work of several branches in their respective areas of their jurisdiction. RBI conducts the Statutory Inspections of these UCBs. It would not be justified if I don't discuss about the success story of the cooperative movement in India. AMUL, KRIBHCO, NAFED, HAFED, NCDC, VERKA etc. etc. are the best cooperative institutions in the country which have made the dent in the cooperative field. Of all AMUL is the best one which now an institution accepted as an International institution and earned the name. Gujarat is regarded as the leader of the Cooperative movement in India where the movement has gone into the blood of every rural citizen of Gujarat. Day and night they work for strengthening the cooperative movement. Since all the CCBs and the SCBs are headless, several expert panels constituted by the RBI/ NABARD have recommended for the setting up of an all India Cooperative Bank - National Cooperatve Bank of India (NCBI) in the past but the GOI is not paying any heed towards this important issue resulting which they are suffering a lot as they are headless at the moment at the national level. Prime Minister Narender Modi should pay his attention to this important matter ask the RBI/NABARD on this score. It bad luck for the cooperative institution in the country that "COOPERATION "is a state subject for which only the states of the country are the only the competent authorities to deal with the subject independently. This should have been in the concurrent list about which State and Central Governments may legislate issues of the "Cooperation" the at least. Since "COOPERATION "is a state subject, there remained always the undue political interference of the local politicians into the sensitive affairs of the cooperative institutions in the country. They commit the grave mistakes and the irregularities in handling the affairs of the cooperative institutions independently resulting which they have become almost defunct/ dormant and are of no use. They go detrimental to the interests of the farming community at large. Apart from their negative side of their working as dis cussed in the preceeding lines, in the intervening period w.e.f Nov. 8 2016 to December 31 2016, it is allegedly observed by certain quarters and the GoI agencies that they played their totally unbecoming roles in getting the demonetized currency notes of Rs. 500 and Rs. 1000 deposited with them by the general public throughout the country. The issue involved is being thoroughly scrutinized, examined and investigated with this, a question mark is being raised that they are working against the very interests of the farming community of the nation. Undue political interference of the politicians of the country should be made to halt at this stage only if the GOI really do something positive for the farming community so that the cooperative institutions may function smoothly. Another feature which is very important to discuss here that the Managements of the CCBs and the SCBs are not professional ones as the State Governments usually appoint the defeated politicians to man the affairs of these financial institutions in the country as the Chairmen who act arbitrarily in adjusting their kith and kins (who don't possess the requisite qualifications for the posts) Appointed personnel generally the blue eyed commit grave mistakes/irregularities in these institutions and after committing the same go scot free because of the political patronage, they enjoy their luxurious lives without any fear. Solution to this aspect is that RBI/NABARD should make a strong strategy to deal with this unwanted situation having the unhealthy financial position of these institutions and should depute its well experienced officers of high caliber to these financial institutions for at least 5 years in order to put the same on the rails once again. This act of the RBI/NABARD would generally be welcomed by the people of the country and would be in the interests of the cooperative movement in the country. Or in the alternative the RBI/NABARD should suggest for the constitution of a Recruitment Boatd to select the professionals for the cooperative financial institutions working in the country. We are living in the digital era these days and there is a immediate need for the total degitalization of all the cooperative financial institutions working in the country as also for the online banking also so as to enable to do their jobs effectively and to compete with the commercial banks. If the State Government wants that Cooperative Movement should flourish further in the state for the up liftment of the farming community as also the rural families busy in the horticulture sector also, it should strengthen the capital base of the weak cooperative financial institutions which are under Red these days, from its own resources also after seeking the financial assistance from the Central Government. In the Jammu Division people are the progressive farmrs (Big, medium or small) whose financial position is very weak to go for utilizing the latest agriculture techniques in the agriculture and allied activities whereas the people in the valley, apart from the agriculture and allied activities, are busy in the horticulture sector. They too, need the massive financial assistance to augment their resources in order to supplement their incomes in this era of high inflation. Based on the captioned lines, Dorjay Sahib is an upright person and whose credentials are crystal clear wants that Cooperatives in the state should flourish and further these should be strengthened by the state thereby provided them with the regular financial assistance towards their capital base enabling them to deliver more to the farming community as also the people dealing in the Horticulture sector. To provide the support to him on this score, it is strongly suggested that the State Government should immediately constitute an "EXPERT COMMITTEE ON COOPERATIVES" comprising of the prominent Cooperators, RBI/NABARD Officers and even the former outstanding officers who have worked in the cooperative field and enjoy the rich experience. The said Committee so constituted should submit its report within three months to the State Government for its perusal and actions on its recommendations.

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