PROVISION OF BORROWING FACILITIES. 447 



unlimited liability alone being retained. The principle that agricultural 

 credit societies must generally be constituted on the basis of unlimited 

 liability is retained, but with a view to bringing within the provisions 

 of the Act societies that have grown up and done useful work in some 

 parts of the country, the distribution of profits by "unlimited" 

 societies is allowed in cases where this course is sanctioned by the local 

 Government. The fourth new feature of importance in the Act <1 

 1912 is that it provides for the formation of societies the members of 

 which shall bo other co-operative societies. The grouping of societies 

 in this way into unions, and their financing by means of central 

 banks, is an essential feature in European systems, and action on these 

 lines had already been found feasible in most provinces of India. The 

 other changes introduced by the new Act were of less importance and 

 do not call for special notice. 



Progress of the Co-operative Movement. The provincial Registrars 

 appointed after the passing of the Act of 1904 were expected not 

 only to carry out their formal duties under the Act but also to foster 

 in every possible way the growth of the co-operative movement. In 

 the instructions issued by the Government of India, local Govern- 

 ments were invited to select a few districts in each province in which 

 the experiment might be most hopefully tried, and it was pointed out that 

 it would be advisable to start cautiously and to progress gradually. 

 Stress was laid on the necessity of reducing restrictions to a minimum, 

 so that the people might be encouraged (subject to certain necessary 

 safeguards) to work out the problem on their own lines with such 

 guidance and help as could be given to them. 



When the Act was under discussion many doubts and fears were 

 expressed. These have in great part been dispelled by subsequent 

 experience. It has been found that the root of the matter does exist 

 in India, and that Indians will co-operate, that unlimited liability is 

 is not a bugbear, that societies have succeeded in attracting capital, 

 and that they have not found the absence of a summary procedure an 

 insuperable difficulty in the way of collecting their debts. Making 

 every allowance for the facts that India has been able to profit by 

 the experience gained in other countries, and that the pioneer work 

 has been done by the State and not by individuals, progress has 

 indeed been extraordinarily rapid. Even so, the movement 

 has as yet touched only the fringe of the v;ist population 

 concerned. 



