BANKING TRADE AND COMMERCE

CO-OPERATIVE MOVEMENT

Co-operative movement: The co-operative movement was started in India as a result of the economic distress caused to the peasants during the latter part of the 19th century. The Famine Commission of 1901 stressed the necessity of starting credit societies in India on Co-operative basis to solve the problem of rural indebtedness. A real beginning of the co-operative movement was, however, made when the Co-operative Credit Societies Act of 1904 was passed. The object of this Act was to encourage thrift, self-help and co-operation amongst agriculturists, artisans and persons of limited means. Societies formed under the Act were given legal status and were authorised to raise funds and carry on business in a corporate capacity. They were classified as rural and urban. Rural societies were bound to accept the principle of unlimited liability while urban bodies were given a free choice of limited or unlimited liability. This Act, however, was deficient in many respects. The Act of 1912 was, therefore, passed to fill in the lacunae of the earlier Act. It regularised certain practices of doubtful legal validity and made provision for further expansion under proper safeguards. The distinction between rural and urban societies was abolished and a more scientific classification based on the nature of the availability of members, whether limited or unlimited was adopted. Co-operative societies other than credit societies were allowed to be formed. Registration of unions and federal bodies like central banks was expressly legalised and a number of minor improvements were introduced. The simplicity and the elasticity of the old Act were at the same time preserved and a wide rulemaking power was left to provinces to enable them to develop on their own lines.

The war and post-war period witnessed some progress in the number of societies, their resources and their coverage. In particular, there was a growth of consumer's societies when the Government decided to appoint co-operatives as agents for its purchase and sale of foodgrains that had run in short supply.

The co-operatives played a vital role after Independence. The rise in prices improved the paying capacity of agriculturists. This had a favourable effect on the position of the co-operative societies. During the Second Five Year Plan period i. e., 1956 to 1961 development of co-operative movement was given special emphasis with the guiding principles incorporated in the Rural Credit Survey Report viz.,

(1) State partnership at all levels.

(2) Linking of credit with marketing.

(3) Education and propaganda of the theory and practice of co-operation.

The co-operative movement is primarily an agricultural credit movement. The rural credit societies occupy a paramount place in the co-operative movement in the district. The credit movement was started in the district with the organisation of the Central Co-operative Bank in the year 1909. Co-operative movement though originated in the first decade of the century, lacked popular enthusiasm till 1940. It made good progress during the World War II. The concentrated efforts have resulted in rapid progress of the co-operative movement after the World War II.

Co-operative movement has taken tremendous strides in the district during the Five Years Plans. The five years plans of the State have sought the promotion of co-operative organisations through financial support for undertaking different economic activities in the form of subsidies, share capital investment and loans according to needs. The programme during the Third Plan was concerned mainly with development of co-operative marketing and credit to agriculturists through co-operatives. Co-operative farming was also envisaged on a fairly large scale.

An outlay of Rs. 30.27 lakhs was outlined for the entire programme under co-operation and the total expenditure against this was of the order of Rs. 26.40 lakhs. In all, an amount of about Rs. 6 lakhs was spent on the expansion programme for agricultural credit; while Rs. 16.65 lakhs were spent on development of marketing under the co-operative fold, under which mainly godown facilities were made available to agriculturists. The expenditure programme for co-operative farming was of the order of Rs. 3.77 lakhs.

Now the pattern of credit and marketing in the district is well shaped. The District Central Co-operative Bank has 26 branches spread over 13 blocks, each block headquarters having one branch and the remaining are located at mandis and prominent places. Each block headquarters has got a co-operative purchase and sale society. There are seven agricultural produce market committees in the district regulated under the Maharashtra Agricultural Produce Marketing (Regulation) Act of 1963. Co-operative movement has now been extended to activities connected with fisheries, housing, processing, farming etc.

The following table shows the number of co-operative societies as on 30th June 1966 and 30th June 1967 in the district.

TABLE No. 2

Total number of Co-operative Societies in Akola District.

The following is a description of the various types of co-operative societies in the Akola district.

District central Co-operative Bank.-— The District Central Co-operative Bank at Akola, was established in the year 1909 and has been working as a federal financing agency catering for the credit requirements of all the primary credit societies in the district. Since 1962, the Zilla Parishad also transacts its financial business through this bank. This bank advances short and medium term loans. The medium term loans are particularly advanced for purchase, of milch cattle, buffaloes, land improvement, con-struction of stables, purchase of improved tools and equipment, etc. The District Central Co-operative Bank limited, Akola is the only Central Co-operative Bank in the District having its 26 branches at various block headquarters, and important places in the district. The opening of these branches has facilitated the working of the bank regarding financing the societies and collecting recoveries to be effected from them. The other advantage derived from these branches is in regard to securing deposits in rural areas. Now that the banking facilities are made available to the village cultivators on a large scale, it is expected that the business of the bank by way of deposits would flourish in future. With a rise in the Bank Rate this bank has also revised its rate of interest. The rate of interest on savings deposits stands at 4.5 per cent.

In the following table is given the information about the working and financial position of the bank.

TABLE No. 3

Working and Financial Position of the Akola District

Central Co-operative Bank.

(Figure of Rs. in lakhs)

The bank was given State share capital contribution of Rs. 2 lakhs in 1962-63, and a sum of Rs. 20 lakhs was sanctioned as additional share capital contribution to the bank by Government during 1966-67.

Land Development Bank.—The Akola District Land Development Bank Limited was established at Akola in 1938 with a view to providing long-term finance to the cultivators. The bank has 16 branches at different block headquarters. The following figures show the working of the bank for five years from 1962-63 to 1966-67.

TABLE No. 4

Working of Land Development Bank during 1962-63 to 1966-67 in Akola District

(Rs. in lakhs)

From the above table it will be seen that the bank took very big strides in advancing loans for purchase of pumps and engines to augment the drive for rabi campaign during the year 1966-67.

The Maharashtra State Land Development Bank has floated ordinary and rural debentures for collecting funds for long term finance to the land development banks. This district has exceeded the target fixed for contributing towards the rural debentures a number of times.

In the following table is given the collection of rural debentures by this bank from 1961 to 1967.

TABLE No. 5

Rural Debentures Collection in Akola District

The following table shows the achievement of the bank under the well takavi scheme.

TABLE No. 6

Statistics showing achievement of Well Takavi Scheme in Akola District

It will be seen from the above table that the bank has made remarkable progress in catering to long term finance under various schemes of co-operative movement. The bank has also developed its staffing pattern on the lines stipulated by the Maharashtra State Land Development Bank to facilitate the work of supervision and recovery.

Urban Co-operative Bank.—The Urban Co-operative Bank was established at Akola in 1962. The following table shows the performance of the bank from 1962-63 to 1966-67.

TABLE No. 7

Working of the Urban Co-operative Bank at Akola

(Rs. in lakhs)

The urban bank mainly caters to the needs of middle class people and petty traders in the town. It also transacts a considerable business of its own in other fields. It has joined the integrated scheme of inland exchange under the Bombay Bankers Association. After the application of Banking Companies Act to the co-operative banks from March 1966, one urban co-operative credit society was organised at Akot during the year 1965-66.

From the above table it is evident that the bank is showing good progress. The profits made by the bank are mainly due to commission earned on the business transacted.

Agricultural Credit Societies. There are in all 840 societies in the district which include 18 large size multipurpose societies, 766 service co-operatives and 56 crop loan societies. The following statement indicates the working of these societies during the period of five years from 1962-63 to 1966-67.

(Rs. in lakhs)

It will be seen from the above statement that the societies have made progress in respect of membership, share capital, etc., from 1962-63 to 1966-67. The position of these credit societies in general is improving steadily and 759 societies have undertaken non-credit activities. The large size and seva Sahakari societies (service co-operatives) in the district were given financial assistance by way of share capital contribution, managerial subsidy, loans and subsidy for construction of godowns. Realising the importance of distribution of consumers articles in the urban as well as rural areas, as many as 759 purchase and sale societies have opened consumers section. They have taken up the work of distribution of controlled foodgrains and sugar. The total number of khatedars in the district stood at 1,42,792 by 30th June 1967, out of whom 4,680 were minors, 17,401 duplicate members and 1,20,711 were eligible to be members of seva sahakari societies. The total membership of these societies in the district is 1,10,869. New targets have been given to supervising unions and also to the group secretaries and the progress made is watched in the monthly meeting of prominent cultivators similarly.

Circle-wise, block level and taluka leval meetings are conducted where the question of effecting recoveries is fully considered and examined. Due to drought and general failure of crops in the district the central bank in consultation with the apex bank formulated proposals, and accordingly distributed loans to the extent of Rs. 50 lakhs during the year 1965-66. This gave great relief to the agriculturists in the stricken areas. During the year 1967-68, 21,612 recovery cases valued at Rs. 98,48,622 were sent to Special Recovery Officers and with a good season during 1967-68 all out efforts were made to recover at least 80 to 90 per cent of the loans.

Non-Agricultural Credit Societies.—There were in all 35 non-agricultural credit societies as on 30th June 1967. Their working from 1962-63 to 1966-67 is given in the following table.

TABLE No. 8

 Non-Agricultural Credit Societies in Akola District

(Rs. in lakhs)

Most of these societies have been formed by the employees and have been affiliated to the District Co-operative Central Bank Limited, Akola. Out of the above mentioned societies there are two societies of mill workers. One belongs to the Sawatrarm Mill and the other to Mohata Mill.

Co-operative Marketing Societies.—There are in all 14 purchase and sale societies including the district marketing societies in the district. One of them is a purchase and sale cum processing society. These societies are located at every block headquarters. The Murtizapur purchase and Sale Society has a branch at Karanja. These societies also work as sub-agents of the Vidarbha Co-operative Marketing Society Limited, Nagpur and deal in fertilizers, iron, steel, sugar, cement, agricultural implements etc. They also do adat business. Details about the working of these societies are given below:-

TABLE No. 9

Working of Co-operative Marketing Societies in Akola District

(Rs. in lakhs)

During the year 1964-65 a sum of Rs. 9,99,250 was given as additional State share capital contribution to all the purchase and sale societies in the district. For the year 1966-67, Rs. 50,000 were sanctioned to the district marketing society as share capital contribution, in view of the increasing responsibilities of the purchase and sale societies regarding co-operative marketing and linking of credit with marketing, all the credit societies in their jurisdiction have been affiliated to these societies. Their contribution to the share capital of the purchase and sale societies amounts to Rs. 9,97,205. In the jowar procurement scheme all the purchase and sale societies in the district work as sub-agents of the Maharashtra State Co-operative Marketing Society. They procured a total of 2.67,660 bags of jowar during 1966-67. The total procurement of jowar was expected to reach a target of 4,50,000 bags in 1968-69.

The purchase and sale societies provide adequate storage of foodgrains and arrange their sale through Fair Price Shops. Another useful link in marketing was the establishment of the Akola District Co-operative Marketing Society in March 1966, with a share capital contribution of Rs. 92,000 from Government.

Co-operative processing Societies.-- There are six cotton ginning and pressing societies and five agricultural processing (oil-crushing) societies in the district. Of these, the ginning and pressing societies at Telhara and Akot have commenced working. At Patur there is a purchase and sale cum ginning and pressing society. The following table gives the details about the working of these societies in the district from 1962-63 to 1967-68.

TABLE No. 10

Working of Co-operative Processing Societies in Akola District

(Rs. in lakhs)

The following table gives the details about the oil-crushing societies in the district.

TABLE No. 11

Oil crushing Societies in Akola District

(Rs. in lakhs)

Co-operative Farming Societies.—There were in all 66 societies during 1967-68 in the district out of which 54 are collective and 11 joint farming societies and one is the federation of all farming societies in the district. Out of the 66 societies, 47 societies are affiliated to the federation. Following table gives the details about these societies for the years 1962-63 to 1967-68.

TABLE No. 12

Co-operative farming Societies in Akola District during
1962-63 to 1967-68

(Rs. in lakhs)

Dairy Co-operative Societies.—There are in all 34 dairy cooperative societies in 1967 in the district including the co-operative milk federation. Of these, 28 dairy co-operative societies supply milk to the Government milk scheme through their federation. The following table indicates the working of these societies in the district.

TABLE No. 13

Dairy Co-operative Societies in Akola District during the years 1962-63 to

1967-68

(Rs. in lakhs)

The Government milk scheme has advanced Rs. 3,18,600 to the dairy co-operative societies for purchase of 600 milch cattle through the Milk Federation Limited, Akola to which these Societies have been affiliated. During the year 1966-67 the average milk supply per day was 3,100 litres. During the year 1966-67 a sum of Rs. 15,900 was sanctioned as management subsidy to 16 dairy co-operative societies including the federation.

Fishery Co-operative Societies.—There were four fishery co-operative societies as on 30th June 1967 at Akola and Karanja. Two more fishery co-operative societies wore registered in the district at Pinjar in Barshi Takli block and at Kekat Umar in Washim block in 1968. The following table gives the details of the working of the fisheries societies in the Akola district.

TABLE No. 14

Fishery Co-operative Societies in Akola District for the years 1962-63 to 1067-68

(Rs. in Thousands)

All the fisheries co-operative societies have been financed by State Government under the share capital contribution and managerial subsidy schemes.

The fishermen co-operative societies at Akola and Karanja received a State share capital contribution of Rs. 1,500 in 1962-63 and Rs. 1,000 during 1963-6-1 They have also received management subsidy. Attempts are also made to give them technical guidance through the Assistant Fisheries Officer, Akola. During the year 1965-66 two more societies were given financial assistance of Rs. 2,000 as share capital contribution. The Akola fishery society has been selected for intensive development of fishery industry and additional share capital contribution of Rs. 10,000 has been proposed for the same.

Wholesale Co-operative Consumers Stores.—The wholesale co-operative consumers stores at Akola was established in 1964 under the centrally sponsored scheme for distribution of consumers articles in urban areas. It had the wholesale agency for the sale of sugar in Akola town till 1966-67. The number of shops run by it is 30. Apart from Government controlled foodgrains and sugar, it deals in all pulses, bajra, mug, ghee, sweet oil, kerosene, cloth, etc. The total turnover of the stores during the the year 196-67 was of the order of Rs. 77.95 lakhs with a net profit of Rs. 20,599. it has a membership of 1,016. It was given financial assistance of Rs. 91,500 by the government by way of share capital contribution and Rs. 75,000 as cash credit through the Akola District Central Co-operative Bank during the year 1964-65. Similarly a loan for construction of godowns amounting to Rs. 37,500 and a subsidy of Rs. 12,500 has been given to the stores by Government. The construction work of the. godown is in progress. The management subsidy to the store amounted to Rs. 3,000 in the years 1965-66 and 1966-67.

Primary Consumers Stores.—There are six primary consumers stores in Akola town of which one is the Central Railway consumers stores. Out of the remaining live only two are functioning. There are 21 primary stores in other parts of the district Most of these were established during 1945-50 and they are at present running fair price shops.

Primary Co-operative Consumers Societies. --There are eight primary co-operative consumers societies in the district financed by the Government under share capital contribution and management subsidy schemes. During 1966-67 they received Rs. 4,000 and Rs. 800 under each of the schemes, respectively, per store. Efforts are still made to organise more societies in the district under the centrally sponsored schemes.

Co-operative Housing Societies.—There are in all 43 cooperative housing societies registered under different housing schemes as per details given below.

Backward Class Housing Scheme . There are eight societies under this scheme and all of them possess land as detailed below.

TABLE No. 15

Land in possession of Backward Class Housing Societies

Out of these eight societies, five have received financial assistance from Government. The progress of these societies in regard to their building activities is given in the following table.

TABLE No. 16

Co-operative Housing Societies in Akola District

The Yeshwant Housing Society Limned, Dhamni possesses 51 plots admeasuring one acre and eleven gunthas and it proposes 10 acquire 82 more plots.

Low income group housing scheme.—There are 22 Co-operative housnig societies under this Scheme of which 19 housing societies are functioning and three are dormant. The Vidarbha Housing Board, Nagpur has financed these societies to the tune of Rs. 10,59,443 for construction of 298 tenements. These societies have so far constructed 215 tenements. These housing societies are now financed by the Maharashtra State Co-operative Housing Finance Society Limited, Bombay.

Flood affected housing societies:—There were 13 housing societies registered for flood affected people during 1961-63 and The societies were allotted plots of land. However due to difficulties in meeting their needs for finance most of the societies stand liquidated.

Motor Transport Societies.—There are two motor transport societies in the district, one at Washim which has a fleet of four buses operating on two routes over a distance of 250 miles and the other at Akola started recently. The share capital of the society at Washim is Rs. 20,235 and the reserve and other funds amount to Rs. 97,618. It had a membership of 31 on 30th June 1967, The society earned a profit of Rs. 1,62,262 in 1967.

Industrial Co-operative Societies.—There were 47 industrial co-operative societies in the district as on 30th June 1967. The details about the working of these societies from 1962-63 to 1966-67 ate given in the following table.

TABLE No. 17

Industrial Co-operative Societies in Akola District, during 1962-63 to 1966-67

(Rs. in lakhs)

The number of various types of industrial societies in the district as on 30th June 1966 is given below:—

Forest Labourers Societies. -There are in all 15 labour contract societies and six forest labourers societies in the district. They obtain contracts from Government as also from local bodies. In 1965-66 five labour contract societies were sanctioned Rs. 5,000 as grants for purchase of tools and equipment.

Co-operative Spinning Mill.—-"The Akola Sahakari Soot Girni Maryadit" was registered at Akola on the 27th April 1965 with a membership of 2,660 and a share capital of Rs. 4,72,970. The society received Rs, 4.50 lakhs as share capital contribution from Government during 1965-66. The mill carries out processing of cotton yarn. It has 20,000 spindles in operative service.

The area of operation of the society extends to the two tahsils of Akola and Balapur. The members of the society are cotton growers who meet the needs of the cotton mill estimated at 23,460 quintals every year.

Jilha Kukut Vikas Society.- -Recently The Jilha Kukut Vikas Sahakari Society Limited, Akola was established at Akola. It has a membership of 100 with collected share capital of Rs. 6,500 It received Rs. two lakhs as working capital and Rs. two lakhs as share capital during 1965-66 from Government.

District Industrial Co-operative Association.—The Industrial Co-operative Association Limited, Akola was established with a view to promote the growth of industrial co-operatives and also to help them in procuring raw materials and in the marketing of their goods. However, since its establishment the association is running a depot mostly for the sale of handloom cloth and articles of handicrafts. The association has now ceased functioning.

Co-operative Supervising Unions.—There are 13 supervising unions one each at the headquarters of the 13 development blocks in the district. The supervising unions collect about 1½% on the working capital of the primary societies as supervision levy towards the joint fund accounts for the service of supervision rendered by them to the latter. The unions also receive subsidies for running their own establishment by Government. Though the scheme for supervision was established in this district in 1959-60, the levy of supervision fees scheme had not commenced till 1904-65. There are 30 supervisors attached to the 13 supervising unions and 264 group secretaries have been appointed for carrying out supervision of 840 agricultural credit societies in the district. There is also a District Supervision Committee to streamline the working of supervising unions and also formulate a common cadre of group secretaries for the district by selection.

The Chairman of the District Central Co-operative Bank is also the Chairman of the Supervision Committee.

District Co-operative Board.—The District Co-operative Board, Akola was registered in the year 1958-59. there are three cooperative training instructors attached to the board and appointed by the Maharashtra State Co-operative Union The board conducted five managing committee classes and trained 101 members during the year 1966-67. The activities of the board are very useful for propaganda and publicity in the co-operative movement in general. The board conducted six societies training classes in which 123 secretaries were trained as also organised live shibirs of co-operation workers one each at Akola, Nimbhora, Patur, Medshi and Karanja in 1966-67.

State aid to Agriculture. —The system of granting tagai loans to the needy agriculturists and farmers is not new. Even before the British rule, it was being operated, although on a small scale, to help agriculturists tide over years of famine or drought. Later the system was applied almost invariably even during normal years. Under the British administration, a number of Acts were passed between 1871 and 1879. Substantial financial assistance, however, was granted only after the Land Improvement Loans Act of 1883 and the Agriculturists Loans Act of 1884 came into force. The fromer Act is broadly concerned with long term loans, while the latter deals with short term financial accommodation.

The following paragraph gives the account of the loans given by Government to needy farmers at the time the old Gazetteer of Akola District was published.

Government Loans.—"Money was very occasionally advanced to cultivators by Government before the Assignment, when it was very difficult to get enough land occupied to secure a good revenue; it is now issued either for permanent improvements or for temporary purposes. The general name applied lo all these loans is takavi or takai; they are made under the Land Improvement Loans Act or the Agriculturists Loans Act according to the permanence or otherwise of their object. Owing to the changes which have occurred in the composition of the District it is impossible to get complete figures about the matter. In the famine of 1896 1897 Rs. 29,000 under the Improvement and Rs. 6,000 under the Agriculturists' Act were advanced in five taluks, but the advances in Akola taluk are not known. Basim taluk received the largest sum under the former Act and more than half of the total under the latter. In the great famine of 1899-1900 it would appear that in the same five taluks about Rs. 75,000 were issued under the one and Rs. 30,000 under the other, Basim again having the largest total; but the figures preserved are very incomplete. Since the famines the figures have been about Rs. 1,000 a year for each taluk under the more important Act, except that Akot takes less than half that amount and mere trifles under the Agriculturists' Loans Act, except again that Basim takes an average of Rs. 2,000 a year. The rate of interest is only 6 per cent, per annum, whereas from 12 to 24 per cent is commonly charged by money-lenders, but takavi advances are clearly not popular; the reason seems to be summed up in the word rigidity. Applicants find themselves faced with numerous formalities and officials and by considerable delay; perhaps also there is sufficient positive outlay, in travelling and otherwise, appreciably to reduce the cheapness of the loan. To some extent these difficulties are inevitable but they may perhaps be reduced."

Land lmprovement Loans Act of 1883.—Loans under this Act are granted to cultivators for works of improvement on land, such as, construction of weds and tanks, preparation of land for irrigation, drainage, reclamation of land from river and other waters and protection of it from deeds or erosion. The Collectors, Prant Officers and Tahsildars are authorised under this Act to grant loans with int. rest at the rate of 8.50 per cent per annum. Government, however, may charge in particular case, a reduced rate or charge no interest at all. The loan is given when the grantor is satisfied as to the security with a margin of safety. When the value of the applicant's interest in the land to be improved clearly covers the amount of the loan with interest and the cost (if any) likely to be incurred in making the same, collateral security is not required at all. Generally immovable property is demanded as security against loan if the amount advanced is large. Personal security may be accepted, even that of one person, provided that his solvency is certain.

Agriculturists Loans Act 1884.—Under this Act loans may be granted to the holders of arable lands for (i) purchase of seed, fodder, hire of agricultural implements, agricultural stock, cattle etc., (ii) rebuilding house destroyed by fire, flood or any other calamity, (iii) maintenance of cultivators while engaged in sowing or tilling their lands prior to the next crop and (iv) any other purpose not specified in the Land improvement Loans Act 1883, connected with agricultural objects. Collectors, Prant Officers, and Tahsildars are authorised to grant loans up to specified limits. Loans above Rs. 2,500 have to be referred to Government for approval, interest of 8½ per cent per annum is charged on all loans, but the Government on the recommendation of the Collector may, in particular cases, is authorised to reduce the rate or charge no interest at all. Terms as regards, security are the same as under the Land Improvement Loans Act of 1883.

Tagai loans for purchase of seeds, fertilisers and weeding operations and for growing more food under the Agriculturists Loans Act are advanced against collateral security, jointly or severalty whereas individual loans under the Land Improvement Loans Act are granted on hypothecation of immovables of the borrowers. The loans are granted even on a person furnishing a collateral security. When individual security falls short while granting loans, the repaying capacity of the borrower is taken into consideration. Generally 75 per cent of the loans are advanced against security of lands and 25 per cent are advanced against collateral security. The ratio of the value of security to the total amounts of loans advanced is 2:1.

The following tables give the details of the tagai loans granted to the agriculturists in Akola district from 1961-62 to 1967-68. They indicate in the first instance, the total number of applications received and sanctioned as well as the amount of loans asked for, sanctioned and actually distributed during the period. They also indicate the reasons as to why in a number of cases the applications for loans were turned down by Government as also how much amount was recovered and what amount is outstanding.

TABLE No. 18

Financial Assistance to Agriculturists, Akola District

TABLE No. 18—Contd.

TABLE No. 19

Government Finance for Agriculture Classified according to purpose, in

Akola District

TABLE No. 19—Contd.

TABLE No. 19—Contd.

Table No. 18 reveals that though the number of applications received by Government shows an increase during the first three years, later on it declined. This is equally applicable to the amount demanded. This was partially due to the Government demand for adequate security and slightly the higher rate of interest charged by it on tagai. There is also another factor that contributed to this state of affairs viz., that the loans were not either repaid in time or repaid in full. The figures of loans outstanding under both the Acts increased yen after year. The total dues were greater under the Agriculturists Loans Act, 1884 than under the Land Improvement Loans Act and greater under the Grow More hood Campaign than under the Agriculturists Loans Act. 1884.

Table No. 19 shows that the loans under the Land Improvement loans Act were given mainly for carrying out improvements on land. Loans under Agriculturists Loans Act on the other hand were given for various purposes, such as, current farm expenditure including expenditure for securing fodder and maniac and for purchasing of draught animals. Similarly, financial assistance under Grow More Food Campaign was extended to agriculturists for procurement of seeds, manures, farm implements as also for purchasing oil-engines and pumping sets, traders and for digging wells and other irrigation projects. During the period from 1961-62 to 1967-68 loans under project areas were given only in the years 1961-62 and 1965-66.

The significant feature of tagai loans was that the bulk of them represented short term loans having a duration of less than five years.

The two major grounds for rejection of applications for loans were (i) lack of security or adequate security, and (ii) old dues to Government. Tagai loans for the purchase of seed and weeding operations and foe Grow More Food Campaign under the Agriculturists Loans Act are advanced against collateral security, jointly or severally. But for loans for ordinary and Grow More Food requirements under the Land Improvement Loans Act, both security of land and collateral security are necessary Generally 75 per cent of the loans are advanced against security of land and 25 per cent are advanced against collateral security. The ratio of the value of security to the total amount of loans advanced is 2:1.

Formerly different rates of interest were charged for loans under Grow More Food Campaign. Thus for loans under Agriculturists Loans Act the rate charged was Rs. 4.66 per cent per annum but for loans under Land Improvement Loans Act the rate of interest was Rs. 7.81 per cent per annum. However, from 1st April 1960 interest on all loans under the Land Improvement Loans Act for the Grow More Food Campaign is charged at the rate of 4.50 per cent per annum or in default at the penal rate of Rs. 6 per cent per annum.

State-aid to Industries: With a view to encouraging and developing small-scale and cottage industries the Government of Maharashtra has set up the Department of Industries. The Department gives financial assistance to these industries under various schemes besides the State Aid to Industries Rules, 1935.

The important small-scale and cottage industries in Akola district are ginning and pressing, textile mills, dal mills, oil presses, confectionery, bidi making, saw mills, printing and book binding, soap making, met d plating, general jobbing and engineering.

In 1960, the Government of Maharashtra passed the State Aid to Industries Act, to regulate grant of loans to small-scale and cottage industries in the State. Under the Act cottage industry is defined as an industry carried on by an artisan in or near his home with capital not exceeding Rs. 25,000. The Act defined small-scale industry as an industry with capital assets not exceeding Rs. five lakhs, regard being had to the nature of undertaking and the number of persons employed therein. The loans granted under the Act were repayable by instalments together with interest from the date of the actual advance of the loan.

Subsequently, the Government passed the Maharashtra State Aid to Industries Rules, 1961, with a view to granting loans to small-scale or cottage industry for the following purposes:—

(1) Purchase of land.

(2) Construction of buildings for worksheds, godowns, warehouses, wells, etc.

(3) Purchase of tools, equipment, appliances, plant and machines.

(4) Erection of plant and machinery.

(5) Purchase of raw materials or for use as working capital other wise than as cash credit.

(6) Tiding over initial difficulties or bottlenecks.

Under the rules the following authorities were entitled to grant loans upto the amount specified against each of them as given below.

Of these loans, those which are granted to the extent of rupees one thousand are to be secured by personal bond of the applicant, and in case of applicant being a firm, by personal bonds of all partners. Loans exceeding Rs. 1,000 but not exceeding Rs. 5,000 are to be secured by one or more personal sureties. [Information shout financial assistance given to industries in the district is not available.]

Maharashtra State financial Corporation.—Financial assistance to small-scale and cottage industries is also rendered through this agency. Originally known as the Bombay State Financial Corporation, this institution was set up in the year 1963 under the State Financial Corporation Act of 1951. Now its activities are restricted to Maharashtra State.

The corporation provides financial assistance to medium and small-scale industrial concerns in the State for purposes of purchase of land, plant and machinery and other assets for renovation and expansion of investing units and for the development of new ones. It considers applications from small-scale units under the State Aid to Industries Rules for aid ranging between Rs. 10,000 and Rs. 75.000 and in exceptional cases up to 1 lakh. The rate of interest for loans advanced is 6½ per cent. The period of loan is decided on merit but is not generally more than ten years. The amount of loan is to the extent of 59 per cent of the net value of the fixed assess consisting of land, building, plant and machinery.

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