SRINAGAR: The Jammu and Kashmir government’s implementation of its Business Revival Package, introduced in 2020 to aid the region’s economy, has come under sharp criticism from the Comptroller and Auditor General (CAG) of India. An audit report has highlighted significant irregularities, including the disbursement of interest subvention benefits to multiple accounts of beneficiaries and the inclusion of ineligible categories like Kissan Credit Cards (KCC) under the scheme.
Information was available with The Chenab Times indicating that the audit, covering the period ending March 2022, found that the Union Territory’s Finance Department failed to establish clear guidelines for the scheme’s implementation and did not adequately communicate the terms and conditions to banks. This oversight led to an ineligible benefit of Rs 59.21 crore being extended to 39,136 accounts, as the interest subvention was applied to more than one account per beneficiary.
The CAG report detailed how the Jammu and Kashmir Bank Limited (JKBL) disbursed Rs 202.47 crore to 65,456 accounts. A subsequent scrutiny revealed that 30,019 beneficiaries with multiple accounts received Rs 57.80 crore, resulting in 35,437 ineligible accounts benefiting from the subvention. Similarly, the J&K Grameen Bank (JKGB) disbursed Rs 5.08 crore to 7,151 accounts belonging to 3,452 beneficiaries who held more than one account, leading to an improper disbursement of Rs 1.41 crore to 3,699 ineligible accounts.
Further violations included the extension of interest subvention benefits to Kissan Credit Card (KCC) accounts and loans under personal segments, which were explicitly excluded from the scheme’s purview according to the original sanction orders issued in October 2020. The scheme was intended to provide a five per cent interest subvention for six months to borrowers whose accounts were standard as of July 31, 2019, or March 31, 2020, and also covered pending subvention under rehabilitation schemes from 2014 and 2016.
The audit report noted that JKBL provided Rs 1.91 lakh in interest subvention to 10 KCC accounts and Rs 1.07 lakh to 22 accounts under the personal segment, despite these categories being ineligible. The government, in its response to the audit findings in December 2023, stated that some KCC accounts were eligible due to incorrect opening under the KCC GL Head, and recovery would be made for the remaining ineligible ones. For the personal segment accounts, the government argued they were wrongly opened under ‘Personal Saholiat’ instead of ‘Saral Finance’, rendering them eligible.
However, the audit department rejected the government’s explanations, asserting that at the time of disbursement, these accounts were categorized under the personal segment, making them ineligible as per the scheme’s guidelines. The CAG also pointed out that the scheme was formulated without conducting a prerequisite survey to ascertain its financial requirements, potentially contributing to the mismanagement and irregularities observed.
The Business Revival Package was conceptualized in August 2020 by the Industries and Commerce Department of Jammu and Kashmir, following the difficulties faced by various economic sectors in the region. A committee, after consulting business associations, submitted its recommendations, leading to the Finance Department’s approval of the interest subvention scheme in October 2020. The total financial implication of the package was estimated at Rs 950 crore for the 2020 Interest Subvention Scheme and Rs 139.24 crore for earlier rehabilitation schemes.
The Finance Department subsequently released Rs 750 crore in three tranches between October 2020 and May 2021. Out of this amount, Rs 526.50 crore was allocated for the 2020 scheme and Rs 137.75 crore for the 2014 and 2016 rehabilitation schemes. The Union Territory Level Bankers’ Committee (UTLBC) was designated as the monitoring agency for the scheme, with the Finance Department acting as the implementing agency.
❤️ Support Independent Journalism
Your contribution keeps our reporting free, fearless, and accessible to everyone.
Or make a one-time donation
Secure via Razorpay • 12 monthly payments • Cancel anytime before next cycle
(We don't allow anyone to copy content. For Copyright or Use of Content related questions, visit here.)
The Chenab Times News Desk
