The Department has so far pursued a policy of providing catalytic assistance, which include financial and technical assistance, to all Cooperatives in the State, irrespective of the fact whether they were involved in execution of policies and programmes of the Government or not. This policy has now been reformed as follows:-
Provide need-based assistance to only those cooperatives, which are executing government policies and programmes.
Dis-invest from Cooperatives, which have become self-sustaining or cannot be revived and sustained by the Government; and
Promote unaided and self-reliant cooperatives.
During the years 1992-1997, the fertilizer distribution policy provided that Markfed would arrange distribution of fertilizer through the Primary Agriculture Cooperative Societies (PACS) affiliated to it other than the focal points and the NCDC adopted Cooperative Societies, which were provided fertilizers by IFFCO and KRIBHCO. In January 1998, the fertilizer policy was revised. Markfed was entrusted the responsibility to supply fertilizer and agro-chemicals to all focal points and NCDC adopted Societies also. This did not succeed and as a result, the policy was revised by the Department in December, 1998. As per revised policy, 60% of the Primary Agricultural Service Societies were attached with Markfed and 40% with IFFCO and KRIBHCO for supply of fertilizers of all kinds. The policy was again reviewed in May, 2000 when IFFCO and KRIBHCO offered distribution margin at par with the margin of MARKFED. However, Markfed offered higher distribution margins if total supplies were assigned to them. As a result, it was decided to entrust total procurement and distribution of Fertilizers through Cooperatives in the State to MARKFED. This arrangement has continued for the last two crops i.e. Kharif 2000 and Rabi 2000-01. The Policy also envisages establishment of Nodal Points for independent procurement and supply of fertilizers. Around 45 PACS and Cooperative Marketing Societies have been designated as nodal points who procure fertilizers on their own from established sources of supplies such as NFL, PPL, IFFCO and KRIBHCO and supply the same to the farmers at relatively lower prices. This experiment has shown good results so far.
Revised Policy
Markfed would continue to procure and distribute fertilizers i,e urea, DAP and NPK through PACS in the State.
Markfed would supply urea, DAP and NPK FOR to PACS.
Markfed would provide a distribution margin of Rs 150.00 PMT of Rs 7.50 Per bag on urea and Rs 280.00 PMT or Rs 14.00 per bag on DAP and NPK. In this way , PACS would get urea @ Rs 4170 PMT or Rs 208.50 per bag and DAP @ 8470/- PMT or Rs 423.50 per bag whereas they would sell the same to farmer @ 4320/- PMT or Rs 216 per bag of Urea and Rs 8750/- PMT or Rs 437.50 per bag of DAP to the farmer.
In case Markfed is unable to provide urea, DAP or NPK FOR to PACs, they would provide an additional margin of RS 60.00 PMT or Rs 3.00 per bag to PACS.
PACS would issue post-dated or good for payment cheques along with a resolution of their respective Managing committees to markfed for supply of urea and DAP . These cheques would be marked for payment on 15th May and 1st June, respectively . These cheques along with resolution of the societies should be submitted to markfed by 31.3.2001.
Markfed would also supply urea, DAP and NPK for cash sales by cooperative marketing societies .These supplies to CMSs would be made at rates equivalent to that of pacs
CMSs would sell urea, DAP and NPK so procured from Markfed in open market to the farmers or dealers other than PACS or their members.
CMS would sell urea at MRP of Rs 8260/- PMT or Rs 213.00 per bag and DAP at MRP of Rs 8680/- PMT or Rs 434.00 per bag.These societies sould retain a minimum margin of Rs. 1.50 per bag on Urea and Rs 6.50 per bag of DAP . This would imply that they would not sell Urea at a price less than Rs 210/- per bag and DAP at a price of Rs 430/- per bag
Markfed may sell urea DAP and NPK through its cash counters at rates not below the rates applicable to Cooperative Marketing Societies.
Markfed would provide Rs 1.00 per bag of Urea. DAP and NPK purchased by PACS as Development Assistance to them . The guidelines for utilisation of Development Assistance by PACS would be issued separately.
Markfed would not utilise / adjust post dated or good for payment cheques issued by PACS for any purpose other than the specified purpose.
The Deputy Registrars.Cooperative Societies would ensure that all pacs and their members get maximum benefit of the revised rates and margins of urea and DAP by 31.5.2001
Policy for Supply and Distribution of Agro-Chemicals
There was no specific policy in regard to supply and distribution of agro-chemicals through Cooperative Societies in the State till 28.5.1999 when the Department decided to allow the Primary Agricultural Cooperative Societies to procure and distribute agro-chemicals of certain identified brands. This policy envisaged to give a wider choice of agro-chemicals to the member farmers of PACS with assured quality at competitive rates. The Department identified quality brand of agro-chemicals on the basis of an assessment of demand of farmers and allowed the Societies to purchase agro-chemicals of these brands on the basis of their demand either through indents or on consignment basis. The supply prices and distribution margin of the Societies were determined by the Department. This policy was opposed by Markfed, stating that it is likely to have an adverse effect on the sale of agro-chemicals produced by them and as a result, the Government withdrew the policy on 11.6.1999.
The policy was revised in May, 2000 when MARKFED was designated as a Nodal agency to procure and distribute some of the popular brands of Agro-Chemicals. A committee chaired by FCC, was constituted by Government to identify agro-chemicals recommended by PAU and largely consumed by farmers and to determine terms and conditions of their procurement and distribution. However, in October, 2000, the policy was again reviewed when it was reported that most of the reputed manufacturers of agro-chemicals were disinclined to supply their products on consignment basis. The Government decided to modify the policy to the extent that the Markfed was allowed to do commercial trading in identified brands of agro-chemicals. Rest of the policy parameters continued as earlier.
Both the above said policies of the Department namely, to assign total procurement and distribution of Fertilizers to Markfed and commercial trading in popular brands of agro-chemicals through Markfed. have been reviewed again in march 2001. The revised policies are as follows:
Procurement and distribution of fertilizers should be divided amongst Markfed, IFFCO and KRIBHCO as prevalent before May 2000.
Markfed, IFFCO and Kribhco should supply fertilizer FOR destination ( for Society) to PACS; and
CMSs should be allowed to procure and distribute popular brands of agro-chemicals from private companies as may be identified by the State Level Committee, through PACS in their respective jurisdiction while Markfed may continue to distribute agro-chemicals produced by it through PACS as they used to do earlier.
The Department is working on a policy to modernize and professionalise its Cooperative Financing Institutions. These Institutions include PSCB, CCBs, PSCADB and PADBs. The policy covers following key components:
Development of Human Resource.
Development of Infrastructure including buildings;
Computerisation of Operations and Records.
Simplification of procedures and strengthening of systems.
The Cooperative Credit Institutions are distinctively structured to provide for Short-Term and Long-Term credit needs of the farmers in the Sate. Short Term Cooperaive Credit in the State has increased from Rs. 7.60 crore in 1965 to Rs. 2364.00 crores in 2000. Similarly Long-Term Cooperative Credit has increased from Rs. 1.64 crore in 1965 to Rs. 375.00 crores in 2000. During 1999-2000, it was observed that loans and advances of PSCB, CCBs and PADBs are stagnating and need to be diversified and made competitive. Realising this, the Banks have embarked upon a New Cooperative Credit Policy, 2001-2006.
The Department is pursuing a conscious policy of disinvestment from un-viable and sick Cooperatives. To begin with, it has decided to disinvest and liquidate three Cooperative Spinning Mills at Mansa, Malout and Kotkapura and the Budhlada Cooperative Sugar Mills Limited, Budhlada. The Department has constituted two Committees - a State Level High Power Committee, chaired by CS, Punjab and a Negotiation Committee, chaired by RCS to pursue one-time settlement of long-term overdue loans of Financial Institutions, namely IDBI, IFCI and ICICI towards these mills and liquidation theirof. These Committees have successfully finalized OTS of outstanding term loans of the Mills towards Financial Institutions, namely IDBI, IFCI and ICICI at payment of principal amount plus 20% of simple interest calculated from the date of default to cut off date i.e. 30.6.1999. With this settlement, the State Government had to pay Rs. 33.34 crore to the Financial Institutions as against Rs. 98.15 crore due to them, saving a sum of Rs. 64.81 crore to the Government and the Mills. A similar settlement for Cooperative Spinning Mills of Abohar, Goindwal and Barnala and eight Sugar Mills of Ajnala, Faridkot, Jagraon, Zira, Patiala, Tarn Taran, Gurdaspur and Fazilka has been finalised for paying only principal amount plus 10% of simple interest. The Government would now pay Rs. 73.24 crore to Financial Institutions as against a guaranteed liability of Rs. 236.5 crore. For revival and restructuring of weak Cooperatives, the Department has also proposed to NCDC to set up a Revival Fund on the pattern of BIFR.
Finalisation of amendments to the Punjab Cooperative Societies Act, 1961.
Downsizing and dispersal of bureaucracy to improve efficiency and delivery.
Formulation and Introduction of Code for Accounting and Administrative procedures in all Apex Cooperative Federations.
Computerisation of Operations and Records.
Human Resource Development through Intensive Training and Up-gradation of knowledge and skills.
Intensive Application of Information Technology.
Promotion and Development of Insurance Cooperatives.
Creation of a fund at Apex and Central Level for development of Primary Cooperatives.
Dis-investment from Cooperative Spinning and Sugar Mills merits greater attention and thrust.
Amalgamation and restructuring of Primary Cooperatives whose imbalances are more than 50%.
Direct sale and purchase of agro-chemicals by PACS.
Direct sale and purchase of fertilizers by PACS.
Greater autonomy to Rural Consumer Cooperatives for supply and distribution of essential commodities in the villages.
Strengthening, Modernization and Diversification of Cooperative Credit System
Development of Infrastructure including building infrastructure
Human Resource Development
Greater thrust on Non-Farm Financing, particularly for rural un-employed youth.
Greater thrust on Direct Finance to the farmers: Gradual Abolition of B-Component of short-term agricultural loans.
Greater thrust on Insurance Linked loaning to the farmers.
Reduction in Administrative and Management Costs of Funds to provide cheaper credit to farmers.
Introduction of ATM–cum-Debit Card.
Introduction of personal banking on the pattern of private and commercial banks.
Introduction of Housing Finance Schemes in selective banks.
Efforts towards Merchant Banking & Demating of Shares.
Efforts to increase the non-fund business.
Development of Women Cooperatives and self-help groups.
Urban Cooperative Banks.
Multi-purpose Cooperative Societies in rural and urban areas.
Greater thrust on Milk Producers' Cooperative Societies.
Development of "Sehkarta Bhawans" at District Level to accommodate all Offices of the Department and Cooperatives to ensure easy access to facilities for the members of Cooperatives and general public.