SOUHARDA CO-OPERATIVES IN KARNATAKA: AN EVALATION

 BACKGROD

The Co-operative Movement was started in different countries with different purposes. In India it was initiated trough State endeavors to facilitate providing credit to the agriculture sector. While the co-operative credit movement in India was started in 1904 with the passing of the first co-operative credit societies Act, in Karnataka it began with the establishment of five co-operative credit societies in erstwhile Mysore State during 1905-1906. The Mysore Co-operative credit society, founded in 1906 (Now Mysore Co-operative Bank) has the privilege of being the first society in the district and was one of the first five co-operatives. In course of time many more agricultural and non-agricultural credit societies both in urban and rural areas were initiated under a scheme introduced in 1910 by availing the services of the retired officials, designated as ‘honorary supervisors’ generally confined to a taluk. They were paid pocket expenses up to one rupee for each day.

            Beginning from such a humble background, the co-operative movement in Karnataka has become a large network of organizational structure with well over 30,000 cooperatives. However, discontent with the existing organizational and management structures of cooperative institutions lead to the enactment of “Karnataka Souharda Sahakari Act, 1997 mainly to reduce the government interference in the management of co-operative institutions.

            The main objective of the new act is to reduce the government interference in the organization and management of cooperative institutions. The Act provides that the co-operatives registered under this Act shall not be eligible to receive any loan, subsidy, grant or financial aid in any form or any guarantee from the government and at the same time the government shall not have any intervention I the day to day operations of co-operatives.  Further, every co-operative shall get its accounts audited by an auditor or a charted accountant appointed by the general body.    Formation of a federal co-operative at the state level ad bestowing upon it  a greater degree of supervisor powers is yet another feature of the Souhardha Act and accordingly the Karnataka State Souhardha Federal Co-operative limited is formed.

Under the new act, final authority of a co-operative vests in the general body. General body elects the Board of Directors and the term of General Body is five years. The new act is looked upon as a law that makes leadership accountable to members.  Since the enactment of Souharda Act, several cooperative societies have been formed all over Karnataka. Since it is more than 15 years, it is important to understand the working of the Souharda Co-operative Societies to understand the efficiency with which these cooperatives are working.

            The present study is proposed with the objective of understanding the nature of societies registered under the Souharda Act and the functioning of these societies.
Some of the questions addressed by this study are;

1. What type of co-operative are registered under the new act?
2. What is the organisational structure of these co-operatives?
3. How the new co-operatives are managing their finances under the condition of ‘no assistance from government’?
4. What is the degree of autonomy ad freedom of administration ad what is its impact o these co-operatives?
5. What are the anomalies, which prevent the effective functioning of Souharda co-operatives?
6. Whether the new act could improve the co-operative spirit?
7. To what extent the new Act has facilitated imbibing of co-operative principles within co-operatives?
8. What is the nature and functioning of the Federal Co-operative?
9. What is the perception of the member co-operatives about the federal co-operative?

The present study is expected to through light on the practical implications of the new act to suggest modification for the promotion of co-operative spirit in the co-operative movement.      

OBECTIVES:

The study has the following specific objectives

1. To map the activities of Souharda Co-operative Societies in Karnataka
2. To analyze the operational efficiency, economic viability and managerial competency of Souharda Cooperative Societies.
3. To analyze the governance structures  of Souharda Societies and to make a SWOT analysis of Souharda Co-operatives
4. To evaluate the functioning of Federal Co-operative vis-à-vis the legislative powers and responsibilities bestowed on it.
5. To suggest  measures for improvement where necessary

METODOLOGY:

            The study will be based on both primary and secondary data. Sample co-operative will be selected from all the districts in Karnataka after collecting data about the total number of co-operatives established/converted according to the new co-operative law.
The study will be undertaken at two levels.  In the first round, a simple questionnaire will be sent to all the Souharda Societies to collect the basic information which is known as priority survey.  In the second round an integrated survey of select cooperative societies will be undertaken with a comprehensive questionnaire supplemented with a few case studies of select societies.  It is proposed to select 200 Souharda Societies spread across all the districts of Karnataka and the selection of the sample societies is purpose based on the priority survey.   The study uses ratio analysis and the governance indicators and factors influencing good governance will be characterized by using appropriate statistical tools.

TIMELINE

BUDGET