Inaugurating a seminar, ‘Urban Cooperative banks in South India’ organised by the Forum of Urban Cooperative Banks, Yechury said that strong resistance is needed to protect the country’s economic sovereignty.

The CPM leader said that the main agenda of globalisation is to maximize profits and create new avenues of profit generation; and the West is utilising the globalisation process to increase their stranglehold on the global economy.

“This requires breaking down of all barriers for free movement of capital. Moreover, the international financial capital would suck into its orbit other financial activity - mainly the one operating at the micro level,” he observed.
Mr Yechury also warned that the urban cooperative sector, which catered mainly to the urban middle class, faced strong threats from the globalisation process.

“The cooperative movement is important to safeguard the interests of the middle class. As access to credit and liquidity is limited mainly to the top echelons of the society, it’s the urban cooperative banks which met the credit needs of this class. Banks are the main bulwarks of our society, and the urban middle class would become defenceless against the rapacious banking system of multi-national companies. If we want to protect our rights, we have to strengthen the cooperative movement,” he urged.

Coop vs Corporate
He flayed the successive governments at the Centre for giving various concessions to the corporate sector, while neglecting the cooperative sector.

Of the 33 per cent tax proposed to be realised from the corporate sector, the actual realisation was only 19 per cent.

 Moreover, more than Rs 1 lakh crores in indirect taxes due from the corporate sector was not collected, he alleged.

Yechury regretted that the gap between the “shining India” and the “suffering India” was widening day by day, and as a result on an average of 20,000 farmers have committed suicide in the country.

 “The middle class gets squeezed out and the important weapon to defend is the cooperative movement”, he observed.

Receding numbers
State Legislative Council Chairman B K Chandrashekhar said that during the last couple of years, the number of cooperative banks in the state has come down from around 342 to 279. “In another two years they will be reduced by another 40-50”, he added.

Later, representatives of urban cooperative banks in Karnataka, Andhra Pradesh, Kerala, Tamil and Puducherry passed an unanimous resolution, urging the Centre to reconsider its decision to impose income tax and restore concession under section 80P of the Income Tax Act.

They also demanded that the concession be extended to cooperative bank deposits also.