[WpProQuiz 7]

THE CONTEXT: On June 30th, 2021, Chief Justice N.V. Ramana delivered the 17th Justice P.D. Desai Memorial Lecture on the “Rule of Law”. According to CJI, regular participation in polls was not a guarantee against the tyranny of the elected. In his speech, he underscored the pressure of social media on institutions. Identifying Covid-19 as “an unprecedented crisis”, CJI urged the governments to evaluate how they used the rule of law or failed to ensure protection to, and, the welfare of all of our people. This article provides insights into the lecture on the Rule of Law vs. the Rule by Law.

IMPORTANT EXCERPTS OF THE LECTURE

JOURNEY FROM RULE BY LAW TO RULE OF LAW	 Our struggle for independence marked our journey towards the establishment of a state defined by the “Rule of Law”.  There was a need to give a guarantee for the laws to be framed with a human face for the benefit of the masses. A framework was needed to ensure this. The framework that forms the binding link between law and justice in this country is what “We the people” gave to ourselves in the form of the Constitution.
CONSTITUTION AND RULE OF LAW	 The framers envisaged the Constitution which not only took care of the prevailing conditions but would also continue and be relevant for all times to come. Therefore Constitution is conceived as a living document whose contents evolve over the years, as the Courts deal with new situations and question and interpret the Constitution in the light of the same.  The Constitution embodies within itself the concept of Rule of Law and the same can be witnessed from our Preamble, the Fundamental Rights, the Directive Principles of State Policy, the Separation of Powers, etc.  By situating the concept of Rule of Law at the confluence of three important values – human dignity, democracy, and justice, our founding fathers showed the path for the rest of the world too.
ADVICE TO JUDICIARY	 For the judiciary to apply checks on governmental power and action, it has to have complete freedom. The judiciary cannot be controlled, directly or indirectly, by the legislature or the executive, or else the Rule of Law would become illusory.  Judges should not be swayed by the emotional pitch of public opinion, which is getting amplified through social media platforms. Judges have to be mindful of the fact that the noise thus amplified is not necessarily reflective of what is right and what the majority believes in.  Social media is incapable of distinguishing between right and wrong, good and bad, and the real and fake. Therefore, media trials cannot be a guiding factor in deciding cases. It is therefore extremely vital to function independently and withstand all external aids and pressures.  The ultimate responsibility of a judge is to uphold the Constitution and the laws. Reason, reasonableness, and protection of human dignity are the values that will serve us well.
THE ROLE OF LAWYERS	 The “Rule of Law” demands expertise, experience, and commitment. Lawyers should perform their duties with integrity and diligence. We need social virtue rather than economically self-interested behavior.  Historically, lawyers have a rich tradition of social activism demonstrated by the number of lawyers who participated in the Indian freedom struggle.  We need now to rebuild and recreate a tradition of civic professionalism. We need a professional ideology about social responsibility.  Both young and senior counsels should extend a helping hand to those in need of justice. Extending ease of access to justice is no less a social justice.
THE ROLE OF SOCIETY	 To advance the “Rule of Law” we primarily need to create a society where “Rule of Law” is respected and cherished.  Only when the citizens believe that they have fair and equal access to justice, can we have sustainable, just, inclusive, and peaceful societies.  Citizens can strengthen the “Rule of Law” by being knowledgeable about it and by applying it to their daily conduct and pushing for justice when needed.

4 CORE PRINCIPLES OF RULE OF LAW

PRINCIPLE	DETAILS	ANALYSIS/PRESENT STATUS
‘LAWS MUST BE CLEAR AND ACCESSIBLE’	- When laws are expected to be obeyed, the people at least ought to know what the laws are. - Law should be worded in simple, unambiguous language.	- In India, we are constantly striving to make legislations and judgments accessible to the general public by translating them into various Indian languages.
“EQUALITY BEFORE THE LAW”	- An important aspect of “equality before the law” is having equal “access to justice”. - Access to justice forms the bedrock of the “Rule of Law”.	- This guarantee of equal justice will be rendered meaningless if the vulnerable sections are unable to enjoy their rights because of their poverty or illiteracy or any other kind of weakness. - There is a need for legal empowerment of women. It not only enables them to advocate for their rights and needs in society but also increases their visibility in the legal reform process.
“RIGHT TO PARTICIPATE IN THE CREATION AND REFINEMENT OF LAWS”	- The very essence of a democracy is that its citizenry has a role to play, whether directly or indirectly, in the laws that govern them.	- In the seventeen national general elections held so far, the people have changed the ruling party or combination of parties eight times, which accounts for nearly 50 percent of the number of general elections. - Despite large-scale inequalities, illiteracy, backwardness, poverty, and alleged ignorance, the people of independent India have proved themselves to be intelligent and up to the task. The masses have performed their duties reasonably well.
“STRONG INDEPENDENT JUDICIARY”	- The judiciary is the primary organ that is tasked with ensuring that the laws which are enacted are in line with the Constitution. Judicial review is one of the main functions of the judiciary.	- The Supreme Court has held this function to be a part of the basic structure of the Constitution, which means that the Parliament cannot curtail the same. - But the responsibility of safeguarding constitutionalism lies not just on the Courts. All the three organs of the State, i.e., the executive, legislature, and the judiciary, are equal repositories of Constitutional trust. - The role of the judiciary and scope of judicial action is limited, as it only pertains to facts placed before it. This limitation calls for other organs to assume responsibilities of upholding Constitutional values and ensuring justice in the first place, with the judiciary acting as an important check.

 THE RULE OF LAW BY DICEY

• A detailed analysis of the concept of Rule of Law was done by Professor A.V. Dicey who in his book “Introduction to the Study of the Law of the Constitution” published in the year 1885 tried developing the concept of Rule of Law.
• Dicey’s theory of Rule of Law consists of three basic principles:

1. The supremacy of law
2. Equality before law
3. The predominance of Legal Spirit

DIFFERENCE BETWEEN RULE OF LAW AND RULE BY LAW

	RULE OF LAW	RULE BY LAW
DEFINITION	- The term "rule of law" comes from the French phrase "la Principe de legality," which translates to "government based on legal principles." It is based on the Latin phrase "Lex is Rex," which translates to "Law is King."	- It is based on the Latin term 'Rex is Lex' which means 'King is Law'.
ORIGIN	- The Rule of Law was first originated by Sir Edward Coke, the Chief Justice in England at the time of King James I. Coke was the first person to criticize the maxims of Divine Concept. He strongly believed that the King should also be under the Rule of Law. - According to him, "Rule of Law" means the absence of arbitrary power on the part of the Government.	- In his battle against the Church and common law judges, King James I of England triumphed, twisting the phrase 'Lex is Rex' to 'Rex is Lex.'
THE CONCEPT	- The state should act as per the "Rule of Law" which is the foundation of any constitution.	- The state acts as per what it this as lawful rather than what the "Rule of Law" says like invoking section 144 without its necessity.

 RULE OF LAW AND INDIAN CONSTITUTION

• In India, the concept of Rule of Law can be traced back to Upanishads. Its traces can also be found in the epics like Mahabharata and Ramayana, Ten Commandments, Dharma Chakra, and other seminal documents.
• The Preamble to the Indian Constitution mentions Justice, Liberty, and Equality.
• As per Article 13, 14 and 21 of the Indian Constitution promote equality although there are exceptions as well.
• Some Exceptions:
• Articles 15 and 16, Article 105 and Article 194.
• Criminal immunity to President and Governor as mentioned in Article 361.
• Diplomatic Immunity as per the Vienna Convention.

JUDICIAL PRONOUNCEMENTS ON RULE OF LAW

• The judicial decisions have played an indispensable role to counter any arbitrariness on part of the state.
• In K. Kraipak V. Union of Indiathe Apex Court held that ours being a welfare State, it is regulated and controlled by the Rule of Law.
• In Maneka Gandhi v. Union of India,the court ensured that the exercise of power in an arbitrary manner by the government would not infringe the rights of the people.
• The Apex Court in Indira Nehru Gandhi Vs. Raj Narain (1975) held that the Rule of Law embodied in Article 14 of the Constitution is the “basic feature” of the Indian Constitution and hence it cannot be destroyed even by an amendment of the Constitution under Article 368 of the Constitution.
• In L Chandra Kumar v Union of India, the court declared the independence of the judiciary to be a part of the basic structure and further the court struck down the amendment to article 323A of the constitution.
• The Habeas Corpus Case (1976) held that article 21 is the sole repository of Rule of law in India.

ANALYSIS: PRESENT STATUS OF RULE OF LAW IN INDIA

• In India, the Rule of Law is not followed in stricto sensu (“In the strict sense.”). There are several instances:

1. Several guidelines have been laid down by the court to curb the practice of honor killing but still, there have been numerous instances of honor killing reported. The decision on honor killing is taken by an extra-constitutional bodyby the nomenclature of Khap Panchayat which engages in feudalistic activities has no compunction to commit such crimes which are offenses under the Indian Penal Code, 1860. No heed is paid to the basic human right of “Right to life and liberty”.
2. The Sabarimala case verdict throws light upon the discretion of men in abiding by the directions given by the Supreme Court only to the point if they are analogous to the belief they hold. After the verdict massive protests were carried out, there were also occurrences of violence against women who tried to enter the temple. The women were denied their constitutional right to worship and the principles of equality were violated even after the practice was declared unconstitutional by the Apex Court.
3. Another evil practice pertinent in society is that of mob lynching. Supreme Court described it as horrendous acts of mobocracy and stated that “the law is the mightiest sovereign in a civilized society”.

In fact, the present debate has started due to increase in the incidences of RULE BY LAW like:

1. Internet shutdown in J&K for over one year
2. Arbitrary application of laws against media and journalists
3. Arbitrary application of UAPA, sedition law and NSA against protesters, dissenters, activists, etc.
4. Gagging criticisms on the mishandling of covid second wave

Such developments give a feeling of an authoritarian state and not of a democratic state. The CJI in his lecture has also highlighted how the people have largely plaid their role through 17 general elections and have rejected the governments if they have failed to withstand the rule of law. No government is permanent. Hence, it is the duty cast upon the three organs to play their role in upholding the rule of law.

THE CONCLUSION: The work of ensuring complete justice can never be said to be completed. The mandate of our Constitution is to work tirelessly to surpass our expectations, to make India a country wherein rights are cherished, and which sets an example for other countries to follow.

“Desamamte Matti Kadoi, Desamamte ManushulOi” (“A nation is not merely a territory. A nation is essentially its people. Only when its people progress, the Nation progresses”)

                                                                                                                                  ———– Maha Kavi Gurajada Appa Rao

Questions to Ponder

1. Differentiate between the Rule of law and Rule by law. Discuss the role of the judges and lawyers in ensuring Rule of law.
2. “The responsibility of safeguarding constitutionalism lies not just on the Courts.” Analyze.
3. Discuss why electoral democracy is prone to tyranny of those who are elected and what should be the safeguards?
4. Social media is incapable of distinguishing between right and wrong, good and bad, and the real and fake. Comment.

(Newspapers, PIB and other important sources)

• Prelims and Mains:

1. India gets its 39th World Heritage Site READ MORE
2. Two-third Indians with non-communicable diseases fall in 26-59 age group, survey finds READ MORE
3. Philippines becomes first country to approve genetically modified ‘golden rice’ for commercial production READ MORE
4. Omid No More READ MORE
5. What is essential defence services Bill and how it will impact ordnance factories and others READ MORE
6. Israel appoints first ambassador to UAE READ MORE

Main exam:

GS Paper- 1

GEOGRAPHY

1. A climate risk: On extreme weather events READ MORE

SOCIETY

1. Why UP’s Population Control Bill Can Prove Disastrous for Women, Poor Families READ MORE

GS Paper- 2

POLITY AND GOVERNANCE

1. Pegasus and the laws on surveillance in India READ MORE
2. Why the monsoon session matters READ MORE
3. Administering India: The British administered India with the help of Indian Army and an institution called the ICS READ MORE
4. It’s Time for the Government To Redeem Itself and Repeal the UAPA READ MORE

SOCIAL JUSTICE AND SOCIAL ISSUES

1. Over 35% of government schools, anganwadis do not have tap water READ MORE
2. Lessons from India’s food security response: Government measures to tackle the food crisis during the COVID-19 pandemic were effective READ MORE

INTERNATIONAL ISSUES

1. Can SAARC fill the power vacuum left by US withdrawal from Afghanistan? READ MORE
2. Science and technology is central to strong and lasting Indo-US ties READ MORE

GS Paper- 3

ECONOMIC DEVELOPMENT

1. Money changer: On need for an official digital currency READ MORE
2. What a digital currency from RBI must get right READ MORE
3. Currency creation: RBI should be careful in launching a digital currency READ MORE

ENVIRONMENT AND ECOLOGY

1. Is climate change to blame for the recent weather disasters? 2 things you need to understand READ MORE
2. Prepare for extreme rainfall events READ MORE

SECURITY

1. Opinion: Strong-armed majoritarianism can never solve the challenges in India’s border regions READ MORE

DISASTER MANAGEMENT

1. Why the world’s cascade of disasters is not a coincidence READ MORE

ETHICS EXAMPLES AND CASE STUDY

1. Scientific and metaphysical thoughts on infinity READ MORE
2. Learn To Be Still READ MORE

Questions for MAIN exam

1. Increase in number of extreme weather events in India calls for climate-proofing of the most vulnerable regions. Discuss.
2. Discuss the measures required to be taken to improve access to food grains and inclusion among the missing vulnerable population.

QUOTATIONS AND CAPTIONS

• We are not makers of history; we are made by history. -Martin Luther King, Jr.
• “If you want to make peace with your enemy, you have to work with your enemy. Then he becomes your partner.” -Nelson Mandela.
• “They who can give up essential liberty to obtain a little temporary safety deserve neither liberty nor safety.” -Benjamin Franklin
• Only proper planning can insure against the inevitable extremities of nature.
• International climate change agreements to limit greenhouse gas emissions will yield benefits only in the very long term but what is done in the near future will mean the difference between surviving and thriving.
• The scale of India’s public food distribution systems is immense and has gone through constant navigation and improvement, which is commendable. But more needs to still be done to improve access and inclusion among the missing vulnerable population.
• India is Europe’s third-largest trading partner, and it does not have its own carbon tax or cap. So, introduction of carbon border adjustment mechanism could be a cause of concern.
• The coming together of leaders, even at the height of tensions, in a region laden with congenital suspicions, misunderstandings, and hostility is a significant strength of SAARC that cannot be overlooked.
• India and the US can be true partners through joint efforts in making the next generation of quantum computers, achieving breakthroughs in the use of AI, making genome sequencing and analysis affordable.
• Using the dangerous and reckless brush of uniformity in a complex nation like India that nurtures unprecedented diversities is a strong-armed display of majoritarianism.

50-WORD TALK

• Soldiering is a calling. It epitomises three cardinal principles of the oath: one, a soldier signs an unlimited liability contract; two, a runners-up position is unacceptable; and three, unity in diversity is non-negotiable. It is in pursuance of these principles that he delivers. In Kargil, as always, our soldiers upheld every part of the contract.
• Indian companies should invest in more renewable electricity and energy efficiency. They can adopt science-based targets for emission reduction and internal carbon pricing to incentivise low-carbon choices. The government can extend the perform-achieve-trade scheme to more industries and provide finance to MSMEs to upgrade to clean technologies.
• SAARC members are among the top troop-contributing countries to UN peacekeeping missions. With the US withdrawal from Afghanistan, a joint peacekeeping force from the SAARC region under the UN aegis could be explored to fill the power vacuum that would otherwise be filled by terrorist and extremist forces.

Things to Remember:

• For prelims related news try to understand the context of the news and relate with its concepts so that it will be easier for you to answer (or eliminate) from given options.
• Whenever any international place will be in news, you should do a map work (marking those areas in maps and also exploring other geographical locations nearby including mountains, rivers etc. same applies for the national places.)
• For economy related news (banking, agriculture etc.) you should focus on terms and how these are related with various economic aspects, for examples if inflation has been mentioned, try to relate with prevailing prices rises, shortage of essential supplies, banking rates etc.
• For main exam related topics, you should focus on the various dimensions of the given topic, the most important topics which occurs frequently and are important from the mains point of view will be covered in ED.
• Try to use the given content in your answer. Regular use of this content will bring more enrichment in your writing.

[WpProQuiz 5]

[WpProQuiz_toplist 5]

THE CONTEXT: In July 2021, Government of India announced creation of a new ministry, the Ministry of Cooperation, which is headed by the Union Home Minister. The aim of the Ministry is to implement the vision of ‘Sahkar se Samriddhi’ or prosperity through cooperation to give a new push to the cooperative movement in India. This article analyses about the topic comprehensively as follows.

WHAT WILL BE THE NEW MINISTRY’S OBJECTIVES?

• The Ministry will provide a separate administrative legal and policy framework for strengthening the cooperative movement in the country.
• It will help deepen co-operatives as a true people-based movement reaching upto the grassroots.
• In our country, a co-operative based economic development model is very relevant where each member works with a spirit of responsibility.
• The Ministry will work to streamline processes for ‘Ease of doing businesses for co-operatives and enable development of Multi-State Co-operatives (MSCS).

WHAT IS A COOPERATIVE SOCIETY?

• According to the Cooperative Societies Act, 1912, at least 10 adult members are needed to form a Cooperative Society solely based on mutual aid and self-help principles. The members should work for a common benefit with a motive to help each other.
• Cooperatives are enterprises which are owned, controlled and run by its members to realize their common economic, social, and cultural needs and aspirations.
• Cooperative societies function for a common benefit with a motive to help its members.
• These societies in have played a significant role in strengthening the rural economy.
• Cooperative societies in India expanded from agricultural market to the credit sector, and later to large scale sectors, housing, fisheries, banking, etc. This led to the formation of different types of cooperative societies in India.

WHAT IS THE HISTORY OF THE COOPERATIVE MOVEMENT IN INDIA?

PRE-INDEPENDENCE ERA

• In response to the agrarian distress and overall indebtedness, the first cooperative society legislation came into existence with the Cooperative Credit Societies Act, 1904. The next landmark Act came in 1919 under the Montague-Chelmsford Reforms, under which cooperation was made a provincial subject. It allowed the provinces to come up with their own legislation for governing cooperatives.
• Later, in 1942, the British government announced the Multi-Unit Cooperative Societies Act to cover cooperative societies whose membership extended beyond one province.

POST-INDEPENDENCE ERA

• In 1958, the National Development Council (NDC) had recommended a national policy on cooperatives and for training personnel and setting up cooperative marketing societies.
• In 1984, Parliament enacted the multi-state cooperative societies Act to remove the plethora of laws governing the same types of societies.
• In 2002, the then NDA government, under the leadership of Atal Bihari Vajpayee, announced a National Policy on Cooperatives to support the promotion and development of cooperatives. It is also aimed at reducing regional imbalances and strengthening cooperative education, training and human resource development.

WHAT ARE THE LAWS GOVERNING THE SOCIETIES AND WHICH GOVERNMENT BODIES OVERSEE THE SECTOR?

1. Cooperation comes under the state list of the under the schedule seven of Indian Constitution; which mean states can make rules to govern them.
2. The 97th Constitutional Amendment, which was passed in 2011, categorically dealt with issues related to the effective management of co-operative societies. It added a new provision in the Constitution under Article 19(1)(c) to provide protection to cooperatives.
3. Article 43B of Part IV states that it is the duty of the State to promote self-reliance, democratic management, voluntary training and professional management of cooperatives in order to improve the economic activity of India.
4. In 2002, the Centre passed a Multi-State Cooperative Societies Act that allowed for registration of societies with operations in more than one state. These are mostly banks, dairies and sugar mills. The Central Registrar of Societies is their controlling authority, but on the ground the State Registrar takes actions on his behalf.
5. The National Cooperative Development Corporation (NCDC) works for the promotion of the cooperative movement in India. It is tasked with planning, promoting, coordinating and financing cooperative development programs at the national level. Also, it provides financial, insurance and technical support to cooperative institutions of farmers and other weaker sections.
6. Most cooperative societies are governed by the laws in the respective states, with a Registrar of Societies and a Cooperation Commissioner as their governing office.

TYPES OF COOPERATIVE SOCIETIES IN INDIA

Based on the members and the kind of business, Cooperative societies in India are classified mainly as 6 types.

1. Farming Cooperative Society: The agriculture sector in India is the largest sector, the country’s farmers need to gain profit for their produce. Unfortunately, this sector is economically weaker because of many causes, some of them being indebtedness of farmers, expensive equipment, agents or middlemen, etc.
   The farmers put in the capital for consolidating farming equipment, seeds, fertilizers, etc.They earn more via cooperative farming as compared to individual farming as the profit is divided according to their land shares.
2. Credit Cooperative Society: The cooperatives which provide financial services to its members like deposits, short term loans, etc. All those who deposit in these societies are their members. These societies raise finance with deposits from its members and provide them with short term loans on a low rate of interest.
3. Producer Cooperative Society: These societies play an essential role in the development of medium and small enterprises in India. These cooperatives are for producers like owners of fisheries, farmers, handicraft and local artisans, and many more such businesses. The best example is one of the largest cooperative in India, AMUL dairy.
4. Consumer Cooperative Society: These cooperatives are formed by consumers. For obtaining household goods at an affordable price, the consumers for such cooperatives buy the goods in bulk to reduce the cost and sell them to its members (and non-members also) at lower prices. For example, Apna bazaar is a consumer cooperative in India.
5. Marketing Cooperative Society: Just like farming cooperatives support farmers for pre-farming requirements, marketing cooperatives support them for marketing or selling their produce. These cooperatives help farmers to sell their produce profitably. Fruits, vegetables, cotton, and sugarcane cooperatives are the largest and most demanded marketing cooperatives.
6. Housing Cooperative Society: Housing is a big issue for the common man in cities and towns with skyrocketing prices of land. In such a situation, people form cooperatives to buy the land, construct houses, and sell them to the members. To become a part of the cooperative, a member either has to buy a house or buy shares in the cooperative.

Characteristics of Cooperative Societies:
1. Voluntary Formation and Participation
2. One vote per member
3. Independent body
4. Mutual benefit
5. No financial risks

Objective: The principal aim of cooperative societies is to help people tide through financial situations and gather support and assistance from nearby communities. This strengthens community relationships.
Distribution of Profits: The surplus produce or profits generated in the cooperative sector is distributed amongst its members rightfully according to their shares.
Professional Management: All cooperatives are supposed to be managed awfully and professionally. Audits must be performed periodically. The regulation is under a central Registrar.

EXAMPLES OF COOPERATIVE SOCIETIES AND HOW THEY FUNCTION

AMUL

• Amul is a leading example of an Indian dairy cooperative society. It is managed by the Gujarat Co-operative Milk Marketing Federation Ltd and is jointly owned by around 36 million milk producers.
• The produce is pooled and distributed by the cooperative itself, thereby, eliminating the need for a middle-man.

Jal Shakti Mission

• While the Jal Shakti Mission may not necessarily fall under the co-operative society definition, however, the mission does follow similar principles.
• Under Jal Shakti Abhiyan, the government is training the community as well as working with them together towards water conservation in water-stressed areas. Men and women of the community are being trained to maintain the systems.

Others

• Some other prominent examples of cooperative societies are Kendriya Bhandar and Sahkari Bhandar, which buy goods directly from producers/ manufacturers, thus removing middlemen and delivering the produce at lower costs to the end-consumers, thereby protecting the interests of both the producers and the customers.
• Cooperative societies are not restricted to agriculture alone. In banking and finance, cooperative institutions are spread across rural and urban areas as credit societies.
• As per NABARD’s 2019-20 report, there are 95,238 primary agricultural credit societies (PACSs), 363 district central cooperative banks (DCCBs) and 33 state cooperative banks in India.
• Apart from credit societies, there are also cooperative housing societies in urban areas and cooperative marketing societies in rural areas.
• Now the union government is trying to replicate the Amul model in other sectors of the economy, especially in the agriculture and livestock sector. Dairy farmers in the country have already benefitted hugely by the cooperative movement, and if the same can be replicated in the other areas, it will help in increasing the income of the farmers.

HURDLES FACED BY CO-OPERATIVE SOCIETIES

1. Non-accountability:  The government gave too many benefits to cooperatives like reservation of items extra benefits like finance facilities so also it was also provided with other support this was a good thing to do, but then there was no further accountability which led to these cooperatives becoming more and more lethargic.
2. Vested interest of some people: A lot of times people who are in position in control of cooperatives are actually people who have joined cooperatives for personal gains.
3. Lack of coordination: Generally, what happens in cooperatives is that different cooperatives at different level don’t coordinate this makes the work of cooperatives difficult.
4. The Internal Free Rider Problem: This problem arises when:
   a) New members who provide very little capital enjoy the same benefits as long-standing or founding members.
   b) When the patronage of new members does not make the cooperative much more efficient or competitive by producing significant economies of scale.
5. Quality more than Quantity:  This is another major problem faced by different cooperatives who go in for quantity this causes a major problem because they think it’s a quick way to earn money so this basically affects the productivity.
6. No Balanced Growth: The cooperatives in northeast areas and in areas like West Bengal, Bihar, Orissa are not as well developed as the ones in Maharashtra and the ones in Gujarat.
7. Political Interference: This is the biggest problem of cooperatives as politicians use them to increase their vote bank. They also get their own favorites on the boards of such boards so they are on control these cooperatives.

NEED FOR THE NEW MINISTRY

• Till now, the cooperative structure has managed to flourish and leave its mark only in few states like Maharashtra, Gujarat, Karnataka etc. Under the new Ministry, the cooperative movement would get the required financial and legal power needed to penetrate into other states.
• Cooperative institutions get capital from the Centre, either as equity or as working capital, for which the state governments stand guarantee. This formula had seen most of the funds coming to a few states such as Maharashtra, Gujarat, Karnataka while other states failed to keep up.
• The cooperative sector has witnessed drying out of funding. Under the new Ministry, the cooperative structure would be able to get a new lease of life.

Vaidyanathan Committee submitted its report in 2005 regarding financial hurdles to the societies. The committees made following observations:

• There is need to have a broad roadmap for revival of the short-term cooperative credit structure
• Equal importance be assigned to all the components as an inter-related and integrated package to ensure synergetic impact in improving the health and viability of the short-term cooperative credit structure, through the following revival package:

1. Special financial assistance to bring the short-term cooperative credit structure to an acceptable level of health;
2. Introduce legal and institutional reforms necessary for their democratic, self-reliant and efficient functioning;
3. Qualitative improvement in personnel in all tires through capacity building.

• The committee proposed a unified national model to incorporate the old state laws into a new law. The key reforms proposed by the CAS include: a bank can grant full voting rights to all users; reducing the State government’s participation in cooperative actions to 25 per cent; and restricting the power of States to replace the board of directors.
• In her Budget speech, Finance Minister Nirmala Sitharaman had mentioned the need to strengthen cooperatives.

AN ANALYSIS OF THE MOVE

Is the creation an assault on federalism?

• PROS: After the formation of the Cooperation Ministry, many contended that the move would countermand cooperative societies, which form a part of the State List under Entry 32 of Schedule 7 of the Constitution, and will go against the basic contours of cooperative federalism.
• CONS: But it is not an assault. As many societies are beyond one state so there is need for the center intervention for effective working, regulations and management of them.
• The Centre also cited the objective as streamlining the whole process and easing the doing of business.

Is it politically motivated move?

• PROS: It is being said that most of the cooperatives (especially in Maharashtra) are under the control of the opposition parties and ruling party just want to control them. It is also being said that Cooperative sector is related to the economy. How the home minister can be the head of the Ministry?
• CONS: But the truth is that the control over the sector and its close link with power has led to lot of malpractices and corruption.
• There have been a number of episodes of corruption and mismanagement in running cooperative banks and sugar factories. The mismanagement and irregularities in the Maharashtra State Cooperative Bank – the state’s apex cooperative bank – compelled to dissolve the board of directors of the banks and appoint an administrator.
• The directors of the bank were mostly local politicians.

Is it really helpful for the cooperative societies?

• PROS: The government created a separate ministry for cooperatives when a department of cooperation already existed.
• There are many possible reasons for this. The first is the sheer size of the cooperative sector measured in monetary terms.
• According to NABARD’s Annual Report of 2019-20, state cooperative banks have deposits worth Rs 1,35,392 crore and district central cooperative banks have disbursed loans to the tune of Rs 3,00,034 crore.
• There are, thus, considerable financial resources to be controlled.
• There is the opportunity for the Union government to tap these resources to offer lucrative schemes to placate the agitating farmers in northern India, including those in western Uttar Pradesh.
• CONS: In any case, the ministry of cooperation is likely to engender greater control and not autonomy of over cooperatives.

CONCLUSION: The real effects of the Cooperation Ministry can be construed more clearly if one takes into account recent occurrences such as the farmers’ protests. In order to remove the deadlock and ensure a more comprehensive approach, the government will ensure that the farming and livestock cooperative movements in other parts of the country following the new agricultural law are successful, increasing thereby farmers’ incomes and land productivity.

Questions to Ponder

1. How far do you agree that the creation of Ministry of Cooperation is an assault on federal structure of India? Justify your view.

2. What are the challenges faced by co-operative societies in India? How the new Ministry of Cooperation will help these societies to overcome such challenges?

3. Can we consider the establishment of the ministry of cooperation as a watershed development for rural economy in India? Justify your view.