Jang Economic Session: SBP urged to revive cooperative institutions

LAHORE: State Bank of Pakistan (SBP) should make separate prudential regulations for cooperative banks in order to activate the cooperative institutions, besides taking necessary steps for the revival of these institutions at national level as it can play a vital role in agriculture development.

These views were expressed by the speakers at Jang Economic Session on “Role of Cooperative Institutions in Agriculture Development”. The panellists were CEO, Punjab Cooperative Bank Ltd, Muhammad Ayub, Cooperative Supply Corporation Chairman Khalid Waseem, Jamshed Iqbal Cheema, Farha Naz Naqvi, Abad-ur-Rehman and Rukhsana Zafar. The session was hosted by Sikindar Lodhi.

Muhammad Ayub said financial position of cooperative bank is sound but the objectivity of cooperative society should not be of taking loans. He said if cooperative society takes big loans, financial burden will increase and small loans will not meet objectivities. He said markup rate of cooperative institutions was lower than the conventional banking but there is a need to activate them to further lower it.

He said these institutions were running agriculture in Malaysia, India and Germany and can play important role in agriculture growth.

Khalid Waseem said cooperative institutions can play an effective role, but government’s support and initiatives were required. Agriculture experts should be appointed in these institutions instead of bureaucracy, he said and added revolutionised reforms can be introduced in cooperatives to resolve small farmer’s issues amicably besides controlling unemployment. He said financial approach ends the concept of cooperatives. He called for legislation for an effective role of cooperatives.

Jamshed Iqbal Cheema said Pakistan is in dire need of cooperative institutions while transparency and accountability is required in giving bank agricultural loans. He stressed for increasing level of education in agriculture sector for more active role of cooperatives to increase agriculture graduates and experts which will help increase productivity by 40 per cent. He called for promotion of modern research for effective role of cooperatives in agriculture sector.

Farha Naz Naqvi said the role of cooperative institutions in agriculture sector was not commendable, adding lack of professionalism and honesty has made these institutions loss giving and weak. She said due to lack of public-private partnership required results were never achieved.

Abad-ur-Rehman said the role of cooperatives is considered to be very important for small land holdings and peasants while ‘Potato Grow Society’ and ‘Kissan Idara’ proved successful models in Pakistan’s agriculture, but now their performance was not appreciating. He said cooperative model was need of the hour as 60 per cent population lives in rural areas and is dependent on agriculture. He said small farmers’ rights were ignored due to lack of interests from government in cooperative institutions. He said modern farming techniques can increase productivity.

Rukhsana Zafar said cooperative farming was promoted in Germany and other countries and they focus on environment-friendly agriculture. She said a number of countries were achieving their value addition targets with cooperative framing and Pakistan should also focus on it.