Home > News > India News

Serious lapses in $9.5 billion farm loan waiver scheme: CAG

Posted on Mar 05, 08:42PM | IANS

New Delhi, March 5 : The government has again come under attack for a corruption scandal -- this time related to the 2008 Rs.52,000 crore ($9.5 billion) farm loan waiver scheme, in which the official auditor has pointed out serious lapses and malpractices.

In a report tabled in parliament Tuesday on the "Implementation of Agricultural Debt Waiver and Debt Relief Scheme, 2008", the Comptroller and Auditor General (CAG) said there were irregularities in at least one in five cases.

Thousands of ineligible persons were given the benefits while deserving ones were denied, CAG said in the report.

"Overall, the performance audit revealed that in 20,216 or 22.32 percent of the 90,576 cases test checked in audit, there were lapses/errors which raised serious concerns about the implementation of the scheme," the CAG said.

Prime Minister Manmohan Singh's government had announced a debt waiver for farmers across the country in 2008, a move that analysts say helped the government win the 2009 general election.

"Farmers who had taken loan for non-agricultural purposes or whose loans did not meet eligibility conditions, were given benefits under the scheme," the CAG said.

The scheme was originally estimated to benefit 3.69 crore marginal and small farmers and 60 lakh other farmers.

Over the last four financial years, the government has waived more than Rs.52,000 crore in loans related to approximately 3.45 crore small, marginal and other farmers.

"It was found that out of the 9,334 accounts test checked in audit across nine states, 1,257 accounts, or 13.46 percent were such who were found to be eligible for benefit of Rs.3.58 crore under the scheme, but were not considered by the lending institutions while preparing the list of eligible beneficiaries," the government's auditor said.

Terming the incident a big "scam", the main opposition Bharatiya Janata Party (BJP) demanded a Central Bureau of Investigation (CBI) inquiry to unearth the real extent irregularities.

"CAG has found out that 13 percent eligible farmers were not considered by lending institutions. Also 8.5 percent ineligible beneficiaries got benefits," said BJP spokesperson Prakash Javadekar.