When Union Home Minister and Minister of Cooperation Amit Shah insisted that the cooperative movement cannot move forward without modernity, transparency and accountability while speaking at a function in Pune, many in the audience could not miss the picture on the dais. 

Many of the Congress and Nationalist Congress Party (NCP) cooperative barons, including the recently appointed Deputy Chief Minister Ajit Pawar, had flanked Shah. All these years, the BJP had alleged that the cooperative sector in the State has been ruined by Congress and NCP leaders who dominate the cooperative movement since 1960.

However, with changed political equations, many of the cooperative barons are now either in the BJP or are supporting the BJP government. When Shah on Saturday launched the digital portal of the Central Registrar of Cooperative Societies (CRCS) office in Pune, these cooperative barons pleaded with him to strengthen the movement.  

ALSO READ | The knotty business of running cooperatives

Shah said that to increase the acceptance of cooperative movement, transparency has to be increased and accountability has to be fixed adding that only such a transparent system can create a connection between crores of people in the country.

“India has given many success stories of cooperatives like Amul, IFFCO and KRIBHCO to the world, now we have to give new momentum to the cooperative movement by taking these along,” he said.

The Maharashtra scene

The culture of cooperatives spread across the country from Maharashtra and the State’s cooperative model is taking the movement forward in the country, said the Minister. But he did not mention what was ailing the once flourishing sector. 

The cooperative movement is a platform to organise people, raise capital and carry out economic and social activities collectively, which adds to their income and generates employment. Initially, the movement started in the field of agricultural credit. It subsequently spread to other sectors such as agro-processing, credit and banking, marketing, dairy, storage, textiles and housing.

Short-term agricultural credit, mainly for seasonal agricultural operations, is provided by Primary Agricultural Credit Societies (PACS). Maharashtra has 21,097 PACS which include 20 farmer service societies and 856 adivasi cooperative societies having about 0.66 lakh and 7.39 lakh members respectively, all controlled by politicos.

The State also has 13,746 cooperative dairy societies and 81 cooperative dairy unions and 21,030 non-agricultural cooperative credit societies, of which 13,955 were urban cooperative credit societies, 6,620 salary earners cooperative credit societies and 455 urban cooperative banks.

About 24 per cent of non-agricultural cooperative credit societies are in loss and 15 per cent of urban cooperative banks in the State were under liquidation. Out of 175 cooperative sugar mills only 28 registered profit and 37 reported losses in 2022.

Sugar cooperative controversy 

In the last few years, the auctioning of the loss-making cooperative sugar mills has turned into a major controversy. 

The NABARD report and the Bombay High Court in its verdict in 2019 has confirmed this modus operandi of sugar barons. The State Cooperative Bank in the past has sanctioned pre-seasonal loans and short-term loans as unsecured loans to sugar mills having negative net worth.

“Prima-facie, therefore the report of the NABARD indicates that these directors were having complete knowledge regarding the transaction and in spite of that, either they sanctioned the loan to such units and/or sold out the properties of such Units at a throw-away price which resulted in a substantial loss to the Bank,” the Bombay HC had noted.

“Cooperative sector is the lifeline of the Maharashtra politics and cooperative barons have connected this lifeline to the ruling alliance. The ongoing probes in the cooperative mismanagement and corruption is on the back-burner,” admitted one of the top State officials.

Related Topics
comment COMMENT NOW