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By P. Sreekumaran

THIRUVANANTHAPURAM: The Central Government has ended up with egg on its face with the National Bank for Agriculture and Rural Development (NABARD) giving a ‘clean chit’ to the district cooperative banks in Kerala.

The Centre, it may be mentioned, had informed the Supreme Court, through an affidavit that the District Cooperative Banks in the State had been prevented from receiving demonetised notes because of their failure to comply with the Know Your Customer(KYC) norms. The Centre’s affidavit had also maintained that these banks lack professionalism and do not have basic infrastructure compared to the scheduled banks.

The NABARD report has said that this is not correct. The report says that the district cooperative banks (DCBs) do comply with the KYC norms. Kerala’s Finance Minister Thonas Isaac has also said that the State Cooperative Bank and the DCBs strictly follow the KYC rules. It also says that cooperative banks in other states may not have the requisite facilities or may be inefficient. But the DCBs in the state do have the basic facilities like the expertise to identify fake notes.

NABARD’s report constitutes a ringing rebuff to the BJP leaders in the state who have unleashed a virulent campaign of disinformation against the cooperative banks in the State. Their contention is that the cooperative banks in the state are vehicles for parking black money.

The Pinarayi Vijayan Government has rebutted this criticism by saying that if there was any hanky panky in the functioning of the cooperative banks, there are provisions in the existing legal system to look into it. To dub all coop banks as dens of black money without pointing out specific cases, amounts to an attempt to destroy the cooperative sector in the State on which more than 75 per cent of the rural population depends to meet their pressing financial needs.

Needless to say, the NABARD report has come as a shot in the arm for the LDF Government, which has been putting up stiff resistance to the ‘sinister conspiracy’ to destroy the cooperative sector in the state.

Buoyed by the NABARD report, the LDF Government has decided to launch a statewide campaign to safeguard the cooperative sector. Chief Minister Pinaryi Vijayan will inaugurate the campaign on December 11.

The State Bank’s stance has received a further boost with the Supreme Court itself observing that the concerns raised by the cooperative banks on demonetisation appear genuine. The Court has rightly asked the Centre to look into the issues raised by the cooperative banks which cater to the agrarian and rural population in the country.

The observation of the Bench led by Chief Justice T S Thakur came on a petition filed by the district cooperative banks in Kerala. The petition had accused the Central Government and the RBI of attempting to cripple the rural and agrarian economy through demonetization, which they termed was “violative of the Constitution.”

What is noteworthy is that more cooperative banks from other states like Maharashtra, Tamil Nadu and Rajasthan have also moved the apex court against the attempt to cripple the cooperative banks. (IPA Service)

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