By Jyotindra Mehta, President NAFCUB
With the cabinet approval for a bill to amend the Multistate Cooperative Societies Act 2002, all provisions in the Banking Regulation Act that are made applicable to the multistate cooperative banks but are at variance with the provisions of 97th Constitution Amendment, will no longer be applicable to them.
The contentious issue of the limitation of directors of multistate urban banks holding office for not more than 8 years, after the amendment to Banking Regulation Act in 2020 will be laid to rest and all multi state societies including multi state urban cooperative banks will have term and tenure of boards as per provision of 97th Constitution Amendment.
This approval of the introduction of a bill to amend the Multistate Cooperative Societies Act 2002, is yet another proof of commitment of the government towards the cooperative sector. Ever since the formation of the Ministry of Cooperation and Shri Amit Shah taking charge of the Ministry, the speed at which the much-needed reforms are being pursued is indeed extremely heartening.
Since the enactment of Multistate Cooperative Societies Act 1984, the central cooperative act has been showing the way to states to keep the legislations simple, user friendly and to lay emphasis on autonomous functioning of cooperatives.
The 2002 Act was an improvement on the 1984 Act. The technological revolution of the last decade or more has brought about mind boggling changes in the way business is carried out. The amendments proposed in the MSCS Act 2002 largely address the needs for the change.
Bringing more accountability through adherence to regulations, transparency, improving governance, providing for electoral reforms in cooperatives and aligning provisions of the Act with the 97th Constitution Amendment are the important aspects of the amendments approved by Cabinet.
The Ministry had been consulting all the important stakeholders in the sector while structuring the amendment. All of us from different national federations and other cooperative entities have given their views which have been taken into consideration while making changes. There will be occasions to fine tune the legislation as we go by.
While we would await to see the text of the bill for amendment to know exactly as to how many of our suggestions have been incorporated to give our considered reactions, as for now, we wholeheartedly welcome the move as a major step in cooperative reforms.