December 22nd, 2011
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State to implement Vaidyanathan report

oommen-chandyThiruvananthapuram: The Vaidyanathan recommendations for revamping the cooperative sector will be implemented by the state government. The Vaidyanathan Committee report has recommended the restructuring of the cooperative sector. It has suggests to depoliticize, democratize and professionalize the cooperative sector through facilitating legislation’s that would follow the broad outlines of a law at the national level. This means strict controls on the societies functioning in the sector.

Initially the government was highly reluctant in implementing the recommendations and hence they strongly opposed it. However, Chief Minister Oommen Chandy stated yesterday that reluctance in implementing the recommendations had cost its cooperative sector dear by way of central assistance. He said that the time given by the centre to comply with the directions in this regard had elapsed. The State would move the Union Finance Ministry to condone the delay and allow to avail itself of the assistance under the scheme. he said the State hoped to receive a grant of Rs 1000 crore from the Centre under the scheme.

Dr A. Vaidyanathan report on agricultural credit is the Task Force on Co-operative Credit System. It had come out with detailed recommendations for recapitalising the credit system, subject to actions by the co-operative credit system and the Government itself formulating a new Co-operative Act. Importantly, it demands that Governments foreswear intervention in the functioning of co-operative societies.

The cost for the total rehabilitation is estimated at roughly Rs 10,000 crore, which is relatively small compared to the magnitude of the task and the large number of co-operative institutions — a lakh — under revitalisation. The Vaidyanathan Task Force has laid particular emphasis on eliminating State interference in the functioning of the co-operative system. With this end in view, it goes to the extent of making arrangements for retiring the share capital contributed to co-operative societies by State Governments. This contribution had been made in pursuance of the Rural Credit Review Committee’s recommendations in the 1950s.

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