Number of arts colleges

In high schools

Number of arts colleges

The Co-operative Movement.

The Need.- More than seventy per cent. of called the Nidhi, corresponded in some respects the vast population of India subsist on agricul- to the provident funds and friendly societies ture and the majority of these millions in European countries. Though these Nidhis generally live, under present conditions, from provided cheap capital to agriculturists the hand to mouth. The ryot's occupation is spirit of co-operation was lacking in tuom. Sir healthy and productive, and he is proverbially Frederick submitted an exhaustive report to honest and straightforward in his dealings, Government suggesting that the formation of except when years of famine and hardsuip co-operative societies afforded an excellent make him at times crafty and recalcitrant. means for relieving rural indebtedness. UnOwing to his poverty, combined with want of fortunately, the report was not received education and consequent lack of fore- favourably either by the non-official public or sight, he has to incur heavy debts to meet by the Government of Madras, and no action occasional expenses for current seasonal purposes, the improvement of his land, or for ceremonial objects, and he has therefore to

was taken on the recommendations made in it. The next few years saw two of the worst famines from which India had ever suffered,

seek the assistance of the local money-lender, and in 1901 Lord Curzon appointed a Comknown as the Sowkar or the Mahajan. The mission to report on the measures to be adopted rates of interest on such advances, though in future to protect the ryot from the ravages of varying from province to province and even famines and to relieve distress. The Commission in different parts of a province, are generally laid stress on the proper working of the Agriculvery high. In addition to charging excessive turists' Loans and the Land Improvement Loans rates the Sowkar extorts money under various Acts under which takavi advances are made by pretexts and oftentakes from the needy borrower Government to cultivators. This system was bonds for amounts in excess of those actually given a long trial in the years previous to the

a

great famines as well as during the years succeeding the 1899-1900 famines. But it is acknowledged on all hands that the system has not been successful in solving the problem of rural stagnation, as it is clear that it is not facility for obtaining cheap capital alone which will raise the agriculturist and relieve him from his debts, but the provision of capital combined with the inculcation of habits of thrift and self-help. This Commission also recommended that the principal means of resisting famines was by strengthening the moral backbone of the agriculturist and it expressed the view that the introduction of co-operation in rural areas might be useful in securing this end.

advanced. One of the chief causes of the ryot's poverty is, that owing to the absence of security and his short-sightedness due to want of education, he did not as rule collect and lay by his savings but frittered away his small earnings in extravagant and unproductive expenditure, on the purchase of trinkets and ornaments, and on marriage and other ceremonies. Tradition says that he hoarded coins under the ground with the likelihood that on his death the money was lost to his family for good. This absence of thrift and the habit of dependence, in case of difficulty, on the Government or on the Sowkar are the bane of his life. There is besides a general absence of ideals or desire for progress. A cooperative society changes all this, inasmuch as it provides him with a suitable institution recommendations induced Lord Curzon to in which to lay by his savings and teaches appoint a Committee with Sir Edward Law at him the valuable lesson of self-help through its head to investigate the question and a report

the sense of responsibility he feels in being its member. Thus the chronic poverty and indebtedness of the Indian agriculturist afford a very good field for the introduction of co-operative methods, especially as his work is of a productive character likely to enable him to earn a better living under circumstances more favourable than they are at present.

Genesis of the Movement. The question

Co-operative Credit Societies' Act-These

was submitted to Government recommending that co-operative societies were worthy of every encouragement and of a prolonged trial. Sir Anthony (now Lord) Macdonell and others were at the same time making experiments on similar lines in the United Provinces and the Punjab with satisfactory results. All these activities, however, took an organized shape only when Lord Curzon's Government introduced in the Imperial Legislative Council a Bill to

of improving rural credit by the establishment | provide for the constitution and control of co

operative credit societies. The main provisions

of agricultural banks was first taken up in the early nineties when Sir W. Wedderburn, of the Bill which became the Co-operative Credit

a

with the assistance of the late Mr. Justice
N. G. Ranade, prepared
scheme of
agricultural banks which was approved of by
Lord Ripon's Government but
not
anctioned by the Secretary of State. The
matter was not again taken up until about
fifteen years later when Lord Wenlock's Gov- self-help among the members.

Societies' Act (Act X of 1904) were:

(1) That any ten persons living in the same village or town or belonging to the same class or caste might be registered as a co-operative

was

society for the encouragement of thrift and

ernment in Madras deputed Mr. F. A. (now Sir (2) The main business of a society was to Frederick) Nicholson, to report on the advisa-raise funds by deposits from members and loans bility of starting agricultural or land banks in from non-members, Government and other the Presidency for the financing of the agricul- co-operative societies, and to distribute the tural industry. There was in existence in Ma- money thus obtained in loans to members, or dras an indigenous system of banking available with the special permission of the Registrar, for persons of small means. This institution, to other co-operative credit socicties.

(3) The organization and control of co- a more scientific division in accordance with operative credit societies in every Presidency the form of liability adopted. were put under the charge of a special Government officer called the Registrar of Co-operative Credit Societies.

(4) The accounts of every society were to be audited by the Registrar or by a member of his staff free of charge.

(5) The liability of a member of a rural

society was to be unlimited

(6) No dividends were to be paid from the profits of a rural society, but the profits were to be carried at the end of the year to the reserve fund, although when this fund had grown beyond certain limits fixed under the bye-laws, a bonus might be distributed to the

members.

(7) In urban societies no dividend was payable until one-fourth of the profits in a year were carried to the reserve fund.

Soon after the passing of the Act, the local Governments in all the Presidencies and major provinces appointed Registrars with full powers to organise, register, and supervise societies. In the early stages of the working of this Act, Government loans were freely given, and the response to the organising work of the Registrars was gradual and steady throughout most parts of the country.

Co-operative Societies' Act.-As co-operation progressed in the country, defects were notic ed in the Co-operative Credit Societies' Act and these were brought to the attention of Government by the Conferences of the Registrars which were for some years held annually. In two directions the need for improved legislation was especially felt. In the first place, the success of credit societies had led to the introduction of co-operative societies for distribution and for purposes other than credit for which no legislative protection could be secured under the then existing law. And, secondly, the need for a free supply of capital and for an improved system of supervision had led to the formation of various central agencies to finance and supervise primary credit societies and these central agencies ran all the risks attendant on a status unprotected by legislation. The Government of India

(d) It facilitated the growth of central agencies by insisting on limited liability, by means of a special clause about the registration of a society one of whose members is a registered society.

(e) It empowered Local Governments to frame rules and alter bye-laws so as to put

restrictions on the dividends to be declared by societies and allowed to societies with unlimited liabilty the discretion to sanction distribution of profits to their members according to principles land down by the Local Governments.

(f) It allowed societies with the permission of the Registrar to contribute from their net profits, after the reserve fund was provided for amounts up to 10 per cent. of their remaining profits to any charitable purpose as defined in the Charitable Endowments' Act. (This kept the movement in touch with local life by permitting societies to lend assistance to local educational and charitable institutions.)

(g) It prohibited the use of the word 'cooperative" as part of the title of any business concern except a registered society.

of

Composition of the Capital Agricultural Societies. - On the organization of agricultural credit was necessarily concentrated the attention of the promoters, for it presented a far more important and far more difficult problem than urban credit. There was a great variety of types among the agricultural societies started in different provinces, and some Registrars adopted the "Raiffeisen," and some the "Luzzatti" methods in their entirety. The commonest type, as prevailing in the Punjab, Burma, and the United Provinces, and now extended practically all over India is the unlimited liability society with a small fee for membership and a share capital, the share payments to be made in annual instalments. In some places, the bye-laws insist on compulsory deposits from members before entitling them to enjoy the full privileges of membership. The system in Bombay and some parts of the Central Provinces is different, there being no share-capital but only an admission fee. Part of the working capital is raised by deposits from members and other local sympathisers,

recognising the desirability for removing these but the bulk of it in all provinces is obtained defects, decided to amend the old Act, and a by loans from central and other co-operative Bill embodying the essential alterations pro-societies. In all the Provinces, the Governposed was introduced in the Imperial Legis- ment set apart in the initial stages every lative Council, and after a few amendments year a certain sum to be advanced as loans co-operative societies,

it emerged from the Council as the Co-operative Societies' Act (II of 1912) replacing Act X of 1904. The outstanding features of the new Act were as under:

(a) It authorised the formation of societies for purposes other than credit, which was possible under the old Act only with the special permission of the Local Government. (This extension of co-operation to purposes other than credit marks an important stage in its development in India.)

(b) It defined, in precise terms, the objects for which co-operative societies could be orga

nised.

(c) It removed the arbitrary division of societies into rural and urban and substituted

started

to newly
usually up to an amount equal to the
deposits from members, raised by a society.
State aid in the form of direct money doles to

agricultural credit societies has now become
an exception rather than the rule, and this
withdrawal in no way hampers the develop-
ment of the movement on account of the rapid
increase of co-operative financing agencies
and the growth of public confidence in the
primary societies. Out of a total working ca-
pital of 23 crores, 24 crores were shares, 34
crores reserves, 14 crores deposits of members,
14 crore deposits from non-members and socie

ties and 14 crores loans from central societies. In Bombay, since 1923, Government place at the disposal of the Provincial Bank an allotment