Public institutions Institutions


Posted 9 February 1998

Publication

Cooperatives in the new environments: Role of the Registrar of Cooperative Societies in South Asia

by Krishan K. Taimni
(FAO, 1997)
The Table of Contents and Introduction of the Study are presented here. You may also download the complete Study in Word 6.0 for Windows (.ZIP, 101K). For an extract, see: Challenges before cooperatives in South Asia: Building a comparative advantage .

Table of contents

1. Introduction

2. Emerging environments and cooperatives

3. Current responsibilities, role and functions of the Registrar of Cooperative Societies

4. Evidence from the field

5. Potentialities and weaknesses of the institution: an analysis of the field evidence of responsibilities and role of the Registrar

6. Challenges before cooperatives - building a comparative advantage

7. Repositioning the Registrar

Bibliography


Introduction

Ever since the cooperatives came to be organized, supported and protected by the state in the early 1900s in South Asia, the principal state functionary associated with cooperatives has been the Registrar of Cooperative Societies. It was the Registrar then, as now, who continued to be responsible for overseeing the administration, working and development of cooperatives. An observer of the cooperative scene in South Asia has compared the institution of the Registrar of Cooperative Societies to the mythological Indian god-trinity of Vishnu (the creator), Mahesh (the preserver) and Shiva (the destroyer) of cooperatives; another observer has called him the "friend, philosopher and guide" of cooperatives while some others have referred to him as the "central figure in cooperative administration". By all accounts, the Registrar of Cooperative Societies and his sprawling field set-up continue to enjoy enormous influence, wield great authority, and exercise immense control over cooperatives in South Asia.

The position of the Registrar of Cooperative Societies has become unique due to a combination of administrative requirements, legislative powers, political necessities and historical circumstances. It would be unfair to wholly decry the role of the Registrar of Cooperative Societies or to ignore the positive role that this institution has played in a milieu often characterized by sharp social and economic disparities, caste-based differences, widespread illiteracy, poverty and exploitation of the weak and the vulnerable by the rich and the powerful. Social structures characterized by rigid caste differences hardly provided a hospitable climate for equity- and equality-seeking institutions like cooperatives to strike roots. Genuine cooperatives - cooperatives based on values and principles of self-help and mutual-aid - flourish in social conditions that are not marked by sharp cleavages and institutionalized disparities. The Registrar of Cooperative Societies and his field staff have been assigned the responsibility to safeguard the interest of those who suffer the most from prevailing unjust inequities in the wider society.

The development of cooperatives, particularly in South Asia, all these years has been a function of state policy; cooperatives are considered as a means of state planning. In the pre-Independence days, the colonial rulers had promoted cooperatives for a very limited and specific purpose, namely, to buy peace in the periodically disturbed rural areas. The peace was disturbed by riots and violence by the indebted and exploited farmers. Rural cooperatives were then created, supported and administered to provide agricultural loans at reasonable rates of interest to farmers. Other types of cooperatives did emerge in due course but the basic approach of the government towards development of cooperatives has always remained the same: protective and paternalistic, permitting limited role and activities, and keeping them under firm and close administrative control through an official machinery especially created for the purpose, the Department of Cooperatives headed by the Registrar of Cooperative Societies.

In the colonial era, it was the fear of these cooperatives becoming rallying points for Independence-seeking political elements that effectively prevented the colonial rulers to let cooperatives slip from their tight control. In the post-Independence period, first, it was their instrumental role under state planning and, later, as potential vote-banks for winning elections to the political bodies which kept cooperatives in the tight embrace of the administrative apparatus over which the politicians presided.

In the post-Independence era, the rulers did change and so did their expectations and perception of the role of cooperatives in a predominantly poor, agrarian society. In countries like India, which have opted for a democratic form of government and socialistic pattern of society and centrally planned model of economic development, cooperatives have come to be seen and treated as no more than instruments of state planning. Government planners target their numbers, determine the scale of their business and decide their place and linkages with other state-created/supported agencies and institutions in the economy. On its part, the government provides financial assistance, discriminatory protection and stable operating environments through a web-like system of licenses and regulations. The number of cooperatives has indeed increased, so has their sweep and coverage; but these cooperatives, in reality, are no more than mere appendages of the vast state administrative apparatus.

The times are changing and so are the roles and places of institutions. In the new, unfolding environments, social and economic development processes are expected to be guided by market forces, and the state has to play a greatly reduced and restricted role in relation to business enterprises. Cooperatives, in order to survive in these new environments, will need a great deal of autonomy and freedom of action. This will certainly call for re-positioning the Registrar of Cooperative Societies vis--vis the administration, development and promotion of cooperatives.

This study of the Role of the Registrar of Cooperative Societies in Selected Countries in Asia has been undertaken for the Food and Agriculture Organization of the United Nations, Rome. The objective of the study is to analyze the role, duties and functions of the Registrar of Cooperative Societies in selected South Asian countries (including India, Pakistan, Bangladesh, Sri Lanka, with occasional references to the situation in the Philippines and China) in a comparative perspective and in the light of recent developments; and, on the basis of such an analysis, suggest appropriate modifications in the role, functions and responsibilities of the office of the Registrar of Cooperative Societies/Department of Cooperatives so that these become consistent and compatible with the wider economic and political changes.

Methodology

The methodology followed for the study consisted of the preparation of in-depth case studies of the role and functions of the Registrar of Cooperative Societies in three states in India, viz. Maharashtra, Andhra Pradesh and Madhya Pradesh, and also in the three neighbouring countries of Pakistan, Sri Lanka and Bangladesh. A field-tested questionnaire was used while undertaking the case studies in the above three states in India. The study of the other three countries was essentially desk-based, though extensive discussions were held with senior government officers, including the Registrar of Cooperative Studies, cooperative leaders and managers.

Structure of the Study

The study is divided into seven parts including Part 1 - Introduction. Part 2 deals with Emerging Environments and Cooperatives; Part 3 covers Current Responsibilities, Role and Functions of the Registrar of Cooperative Societies; Part 4 covers Evidence from the Field and gives the actual position of the Registrar in three selected states in India; Part 5 focuses on the Potentialities and Weaknesses of the Institution, An Analysis of the Field Evidence of Responsibilities and Role of the Registrar; Part 6 discusses Challenges before Cooperatives - Building a Comparative Advantage; and Part 7 makes suggestions for Repositioning the Registrar.

The study does not attempt to explain the evolution of the institution of the Registrar of Cooperative Societies nor the circumstances that contributed to the distortion of its role and position. Rather, it limits itself to analyzing the present role of the office of the Registrar, its strengths and weaknesses and to suggesting a framework for the repositioning of this office in the wake of structural adjustment programmes, gradual emergence of level-field conditions and competitive environments for cooperatives and the imperatives of mobilizing capital by cooperatives from their various stake-holders.

During the last few years, thanks to the meddlesome role of government functionaries and politicians and their below-par performance, cooperatives have lost much of their lustre and many of their adherents. The recently initiated processes of liberalization and structural adjustment programmes now offer an opportunity to cooperatives to redeem the faith of their members.

It is in this context that a new role and place for the Registrar is discussed here. But mere repositioning of the Registrar of Cooperative Societies or the creation of a simpler, more cooperative-friendly legislative environment by themselves would not be sufficient to build self-reliance of cooperatives or nurture their health. In order to become strong and counted in the marketplace, cooperatives will have to build innate strength and resilience. No external change can possibly obviate the need for cooperatives to dig their heels deep, stretch themselves to the full and bravely stand up on their own strength in the emerging competitive environments.

The International Cooperative Alliance has already come out with a Statement of Cooperative Identity which seeks to redefine and reposition cooperatives globally in the new environments. The Statement provides a broad basis to members, leaders and managers of cooperatives to craft appropriate strategies at the national, regional and local levels. However, it is equally important to create supportive state-induced regulatory environments and support structures which, while providing the needed succour, do not stifle and stunt the eventual emergence and growth of member-driven, member-owned and member-governed cooperatives.

It is the purpose of this study to contribute to the on-going debate on how to accomplish a durable balance in relations between the newly positioned cooperatives on the one hand, and the state and its various regulatory, promotional and developmental organs on the other. In the past, the latter have often adversely impinged on the autonomy, management and operations of cooperatives in South Asia much to the detriment of the former.



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