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co-operation, more particularly co-operative credit, in which 

 India has made a success quite unique in the history of co- 

 operation, I think they will do well to send there, and ask 

 for tuition. 



I want to point out particularly in connection with the 

 paper by Senhor Mendonc^a a,nd his colleagues, that the 

 pioneers of co-operation in Portugal have distinctly preferred 

 co-operative credit, and that all other methods have failed. You 

 see the results of the opposite policy in France and in Italy, 

 where Government help given without the aid of co-operative 

 societies has wholly broken down. In Egypt they began with 

 the National Bank lending money. That system has been 

 unsuccessful, because the people would not repay what they 

 thought was a gift, and they contracted the bad habit of 

 running into debt. A few years ago there was about 40,000 

 overdue. They could not proceed against them, and they 

 had to pass the five feddan law, which makes properties under 

 five feddans inalienable. With that the general system of 

 agricultural credit ended. Now they are turning their minds 

 to co-operative credit. 



Sir James Wilson has very rightly emphasized that in tropical 

 countries you cannot apply the same standard that you do in 

 European countries, where people have some idea of business 

 and some degree of self-confidence and self-reliance. You 

 have to begin there with what may be called an infant school 

 training for co-operation. In some countries you will be worse 

 off even than in India, because in India after all there is money. 

 You will have to find some source of supply which will give 

 you the money, and which will fit the people gradually for 

 practising co-operation. Therefore in countries of that de- 

 scription I am not at all opposed, as I have sometimes been 

 reproached for being, to State assistance if applied on the right 

 lines. If, as I believe is necessary, State aid is to be given 

 for training up to co-operation, I think three conditions must 

 be observed. In the first place you must not supply more from 

 outside than is strictly necessary. That is the principle they 

 have adopted in India, and Lord Curzon has done me the 

 honour of referring to me as the authority in deference to 

 which he has adopted it. He said: "We are not niggardly; 

 we do not grudge the money, but we do not want to spoil 

 co-operation." You must supply only what is necessary, and 

 by that means train the people gradually to calculate, and to 

 deal in a business-like way with their money. The second point 

 is that you should give help on business lines. In India the 

 Government lent money at 4 per cent., which was under 

 the usual rate, and the registrar at once protested that that 



