Govt makes lofty promise to cooperative victims to persuade them to withdraw protests

Published On: August 4, 2023 07:45 AM NPT By: Republica | @RepublicaNepal

For about a decade, victims of problematic cooperatives have launched struggles to get their money back, but have been left empty-handed.

KATHMANDU, Aug 4: The cooperative victims who have been in protests in Maitighar, Kathmandu, for around two months, called off their protest on Thursday after reaching an agreement with the government.

According to the Ministry of Land Management, Cooperatives and Poverty Alleviation (MoLMCPA), the government body has reached an agreement with the representatives of the protesting cooperative victims. A seven-point agreement was signed by the two sides in this regard.

In the agreement, the ministry has consented to promptly start a process to establish a ‘Deposit and Credit Guarantee Fund’ to ensure the refund of the money deposited by the members in the problematic cooperatives. Likewise, the ministry has also agreed to take forward the official procedure to set up a ‘Credit Information Bureau’ and a ‘Debt Recovery Tribunal’ in order to promptly move into action the debt recovery process.

In addition, the MoLMCPA, the Department of Cooperatives and the Problematic Cooperative Management Committee will jointly work on the amendment to the laws related to cooperatives, according to the agreement. It has targeted to remove anomalies seen in cooperatives while promoting them to function through the values and principles of cooperatives.

As per the agreement, three representatives from cooperative victims will be inducted into the cooperative sector reform suggestion task force formed by the government.

Both sides have even agreed to make a clear work plan while returning the money of the depositors of the troubled cooperatives including Oriental Cooperative. Although the government through the Problematic Cooperative Management Committee had stepped up to return money to those who suffered, it has remained stranded due to the lack of clear roadmaps.

For the last two months, the victims of cooperatives have been staging demonstrations demanding a return of their deposits along with the interest. They have also demanded that the assets of the absconding cooperative operators be frozen.

After the police intervened, the cooperative victims and the police were even involved in a scuffle during a demonstration held in Kathmandu on Thursday.

According to the government records, around 500 cooperatives have now landed in financial crisis, mainly due to the cash strap amid ongoing economic recession. A report of the Central Investigation Bureau of Nepal Police shows that the problem in cooperatives has also dragged around a dozen of commercial banks, which have invested in the cooperatives, into financial problems.