Co-operative banks... and politicians

For long, I've been intrigued by the relationship between co-operative banks and politicians. Like in the case of many other issues in Goa, we have little 'literature' on this subject, and hence it becomes difficult to comprehend its manifold ramifications.

Just yesterday, a friend who understands the subject well (having been part of these banks for a couple of generations), made some interesting observations on what makes these links grow. Looking forward to any other feedback and debate.

Obviously, the co-op banks are a source of funds and influence for politicians. If you can give friends access to "loans" (often unrepaid or with repayment stretched endlessly) huge sums of (undeserved) monies, it makes you all that more powerful. More so, in a small state.

Like government-funded schools and (sometimes) colleges, handing out jobs to friends and family is another source of influence and encashable political clout. Likewise, it's a source for funding elections, and meeting the liquidity-needs of politicians.

[This is not to suggest that the co-op banks are the only -- or even a major -- source of politicians liquidity in today's Goa. But it is one, little-understood source that has been effectively working for long, before the arrival of many of the monied lobbies we see at play in Goa today -- real-estate, money-lending, luxury tourism, big industry, village-level political corruption, the harvest-the-ecology lobby etc.]

Interestingly, one learnt that politicians actually could be using the co-op banks to turn 'black' (untaxed) money into 'white' (legit). They take loans to launch their projects from the co-ops, and then show as if they're repaying the same from legitimate incomes!

It's a win-win-win situation for the politician. When elections are near, funds are at hand. If they win the elections, they have more additional 'sources' by which to repay the loans (which they, in any case, need not be in a hurry to repay). If they repay, that can also be a channel for converting black-money-into-white. If they lose, the 'bad debts' can be written off.

One cycnical response to this trend was the fact that former CM Manohar Parrikar used the bank issue to squeeze his former ally Ramakant Khalap, though both had a peaceful modus vivendi over the way Khalap ran his Mapusa Urban Co-op 'Bank of Goa' when they were allies together in the BJP!

My guess is that in information-poor Goa, most of the citizens don't even have a clue of the major forces having an influence on their lives and day-to-day existing.

We tend to ignore the issue, since we don't understand it. But it is around all the same... and won't go away simply if we wish it to. FN