Print Edition - 2014-11-06 | MONEY
Govt implementing new measures to curb anomalies Policy 2013
Nov 5, 2014-
The Ministry of Cooperatives and Poverty Alleviation (MoCPA) has started preparations to implement the National Cooperative Policy 2013 aimed at controlling anomalies in the cooperative sector.
The policy talks about barring cooperatives from carrying out multiple businesses to promote specialisation. It will enforce ‘one member-one cooperative’ provision to discourage conflict of interest and set up a deposit security fund in line with banks and financial institutions (BFIs). Under this provision, individual deposits up to Rs 200,000 have been insured by the Deposit and Credit Guarantee Corporation.
It has also provisioned compulsory merger between those failing to fulfil certain standards set by the regulator. The policy says the merger would be encouraged by ensuring additional incentives.
The new policy has talked about putting in place a provision to control cooperatives’ concentration in urban areas and encourage them to go to rural areas with low financial access.
“These anomalies will also be addressed and the measures to be taken will be determined based on discussion,” said Suresh Pradhan, joint-secretary at the MoCPA.
Although the policy was announced almost two years ago, the government has failed to introduce even the action plan let alone the new Cooperative Act.
The government has talked about introducing the new Cooperative Act in the budget for the fiscal year to control the anomalies in the cooperative sector which holds a significant chuck of the public deposit. The current Cooperative Act does not have biting provision to check the anomalies.
The MoCPA said it has developed the curriculum on cooperatives for different academic levels as envisioned by the policy. However, the ministry has failed to implement the rest of the measures that the policy talks on regulating the sector. Pradhan lamented the implementation of the policy was delayed due to lack of manpower along with other resources at the ministry. According to him, they have started homework with support of GIZ--German Federal Enterprise for International Cooperation.
The MoCPA said that the ministry has envisioned developing 25 projects in relation to the objectives of the policy. “Based on the nature of their area of implementation, we will categorise the projects into three divisions--perpetual, specific and priority based,” Pradhan explained.
According to him, the projects’ main focus will be on capacity building of the cooperatives working in different areas. He added that they had started talks with the stakeholders over the selection of projects through the action plan. “We will forward the financial proposal to the Finance Ministry soon after finalising the priority projects,” he said.
The action plan would also look after other aspects of the cooperatives engaged in other business apart from the agriculture sector, he said. “At a time when many cooperatives have been emerging in various sectors like production business, education, hydropower and health, the action plan is expected to develop a framework to regulate them.”
Published: 06-11-2014 09:20