Evolution of Cooperative Movement
The cooperative societies were established in India during the 20th century. The evolution of the cooperative sector has been marked by three phases - the first between 1900 and 1930, the second between 1930 and 1950 and the last between 1950 and 1990. Beginning with the enactment of the Cooperative Credit Societies Act in 1904, several more such laws have been passed.
The government enacted the Reserve Bank of India Act 1934, which led to the establishment of a separate Agricultural Credit Department (ACD) to provide refinance system for cooperatives. The government also set up several committees to strengthen the cooperative sector. The report of the Committee to Review Arrangements for Institutional Credit for Agriculture and Rural Development (CRAFICARD) in 1981 recommended the creation of National Bank for Agriculture and Rural Development (Nabard). The All India Rural Credit Survey (AIRCS) recommended the participation of state government in financing and controlling cooperatives and linking credit and marketing cooperatives.
Post-1969, the intrusion by nationalized commercial banks into the rural credit affected the functioning of cooperative banks.
Political interference through usurpation of the boards of cooperatives also debilitated their working. During the 1990s the government and other Non-Government Organizations (NGOs) attempted to revive the cooperative sector. Many committees were formed to recommend reforms to the cooperative sector. The Brahm Perkash Committee stressed upon the self-reliance and independence of the cooperatives. The committee urged the government to bring the cooperatives under the ambit of the Banking Regulation Act enacted in 1949. It also recommended financial support to the cooperatives from the governments.
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