Chhattisgarh: Structure and growth of Co-operatives and their shares in total credit adequacy and problems

Chhattisgarh: Structure and growth of Co-operatives and their shares in total credit adequacy and problems

The cooperative banking sector is one of the main partners of Indian banking structure, the cooperative banks have more reach to the rural India, through their huge network of credit societies in the institutional credit structure. The cooperative sector has played a key role in the economy of the country and always recognized as an integral part of our national economy. Cooperatives have ideological base, economic objects with social outlook and approach. The cooperative covers almost all cent percent villages in India. The cooperative form of organization is the Ideal Organization for economically weaker sections in the country. According to recent study by World Bank and National Council for Applied Economic Research, the Primary Agriculture Credit Societies (PACS) amount for about 30 percent of micro credit in India. This paper attempts to analyze the role of co-operative bank in agricultural credit.

PACS  are  playing  a  crucial  role  in  improving  the  economic  and  social  conditions  of  the common  masses  of  Chhattisgarh.   They  provide  short-term  and  medium-term  loan  to  the members/farmers at reasonable interest rates to meet their various needs. They are providing credit  to  the  farmers  for  agriculture  purposes  at  cheap  and  easy  terms.  PACS    is    the  foundation  of  the Cooperative  Credit  System  on which  the  super  structure  of  the short-term  cooperative  credit system  is  built.

Short-term structure  is a three tire structure  with PACS in rural areas,  Co-operative Central Banks  at  the  district  level  and  the  Apex  Bank  at  the  state  level.  The  short-term  credit structure  provides  short-term credit  for  crop  production  and  medium-term  credit  for  small developments.  Chhattisgarh  State  Cooperative  Agriculture  and  Rural  Development  Bank (CSCARDB) at the State level and Primary CARD Bank at the Block level cater to the long-term credit needs in the two tier credit delivery system.  In  the  short  term  credit  structure,  1333  PACS  including  476  LAMPS  are  functioning. In addition  to  this,  there  are  6  District  Cooperative  Central  Banks  with  209  branches. Chhattisgarh State Co-operative Apex Bank is functioning as state level financial institution. In the long term credit structure CSCARD Bank with 12 District CARD Banks including 77 branches are functioning.  

In August 2004, the Government of India constituted a task force under the chairmanship of Professor  A.  Vaidyanathan  for  suggesting  measures  for  the  revival  of  cooperative  credit institutions. The  task force submitted its report  in respect of a short-term cooperative credit structure  and  recommended  a  financial  package  of  Rs  14839.00  crore  for  rural  credit cooperative institutions. Based  on  the consensus arrived at  with  the state  governments  and other stakeholders on  the  recommendations made by the task force, the central government approved  the  revival  package  that  involves  financial  assistance  of  Rs  13596.00  crore. NABARD has been designated as the implementing agency for the revival of the short-term cooperative credit scheme. A Department for Cooperative Revival and Reforms has been set up in the head office of NABARD for facilitating the implementation process. The provision of  financial  assistance  under  the  package  has  been  linked  to  reforms  in  the  cooperative sector.  In  order to  avail  financial assistance  under  the  package,  the state  governments  are required to  sign MOU.  The Chhattisgarh  Govt.  signed MOU  of  541.42  crores package  on 25.09.2007.

 

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