India's $4.5 billion poverty plan
under fire By Raja M
MUMBAI - In a major embarrassment for the
government, the Comptroller and Auditor General of
India (CAG) has sharply criticized the country's
US$4.5 billion National Rural Employment Guarantee
(NREG)project as a corrupt, inefficient exercise
doddering along on fudged data.
The
preliminary findings of the report have big
political implications for the central government
still unsure if it will last its full five-year
term until May 2009.
The NREG, the
flagship anti-poverty scheme launched in 2006 by
the
ruling United Democratic Alliance (UDA), operates
in 330 rural districts. Finance Minister
Palaniappan Chidambaram granted an additional $1
billion to the program in December 2007 to enable
it to cover the entire country later this year.
The scheme is the largest of its kind in Asia, if
not the world.
Prime Minister Manmohan
Singh, when he inaugurated the program in February
2006 in Anantapur district, Andhra Pradesh,
described NREG as a "landmark in our history in
removing poverty from the face of the nation".
Stakes are high for the program to succeed, but
the CAG preliminary report suggests it is actually
creating historic landmarks in political and
bureaucratic corruption.
The Ministry of
Rural Development is in denial, claiming that NREG
is in good health, with its latest data saying it
provided 25.4 million jobs out of 25.8 million
households who demanded work under the scheme.
The Rural Ministry said it shared the CAG
data with the state governments for discussion
before the report was finalized, but was worried
enough to call a meeting of the state rural
development secretaries on January 17 to discuss
the CAG report findings.
"The
NREG program is shocking and disastrous in its
scale of corruption," an angry Parshuram Ray,
director of the New Delhi-based Center for
Environment and Food Security, told Asia Times
Online. "Over 70% of the funds have been looted
and the program has made little impact to rural
people at the ground level. And now the government
refuses to accept the findings of its own
auditors." Ray
admitted to being so upset at the large-scale
abuse of taxpayers' money that he shouted at Rural
Development Minister Raghuvansh Prasad Singh
during a TV discussion on the controversy in a
leading English news channel, NDTV.
Ray,
talking to Asia Times Online while touring rural
districts of Maharashtra state in western India,
alleges that many non-governmental organizations
executing the program are also guilty. "They
[NGOs] get NREG program funds for creating
awareness and so on and the most shocking part is
they have become part of the corruption. We have
filed a public interest litigation in the Supreme
Court and a hearing is due on January 20."
If NREG flops, the ruling UDA risks
getting booted out of power much as the previous
National Democratic Alliance did for ignoring
India's rural poor, even as the NDA unsuccessfully
chest-thumped through the last election campaign
on an "India Shining" theme. Shuddering at a
similar fate, the government hurriedly unleashed
NREG as its supposed multi-billion trump card.
The rural employment scheme, enabled by
parliamentary legislation to be called the
National Rural Employment Guarantee Act, promised
one adult member of every rural family a maximum
of 100 days employment every year at wages not
below 60 rupees ($1.50) a day.
The
six-month internal central government audit of the
program says the NREG Act barely covered 3.2% of
the registered households in the financial year
between February 2006 and March 2007; in other
words, NREG failed to deliver to 97% of intended
beneficiaries. The report covered 513 sample
villages across 68 randomly selected districts in
26 Indian states.
The NREG scheme was to
provide employment through rural development works
such as water conservation, irrigation, flood
prevention and road construction. But the CAG
findings, first exposed by the English news daily
Indian Express, highlights corruption, including
payments to people already dead and for
non-existing work.
Rural poverty is the
looming dark side of the "India Rising" economic
story, and agriculture comprises 18% of India's
gross domestic product; 65% of India's population
live in villages, and the agriculture sector is
facing critical challenges, such as from cheaper
imported farm produce as the Indian economy has
opened to global competition.
India's growing agrarian
crisis has also been attributed to farmers being
lured to give up traditional farming methods and
use expensive genetically modified seeds, such as
the controversial Bt cotton seeds, pesticides and
fertilizers, with disastrous results.
Successive Indian
governments have failed to execute land reforms to
enable small farmers to own tilling land. NREG
ignores these core issues. More damningly, NREG
has not stopped indebted farmers killing
themselves. Over 10,000 cotton-growing farmers
have committed suicide since 2004 in Vidharba
district, Maharashtra, due to individual debt
sometimes amounting to $250. Over 100,000 farmers
have killed themselves since 1993, a number
acknowledged in Parliament by India's agriculture
minister, Sharad Pawar.
"The NREG program
is the biggest governmental rural programme in the
world in recent times but has not made any impact
on farmer suicides," Kishor Tiwari, president of
the Vidarba Jan Andolan Samiti, told Asia Times
Online.
Tiwari's organization, based in
Maharashtra's winter capital Nagpur, is an
activist group working for the distressed farmers
in Vidarba. "There is 90% corruption in the NREG
program benefiting mostly contractors with fake
muster rolls," alleges Tiwari, who also believes
that the basic programme structure is flawed.
"Farmers are not used to constructing roads and
buildings and it is no use offering them such
work."
Tiwari says Manmohan's visit to the
suicide-stricken Vidarba region in July 2006 has
made little beneficial impact. Manmohan, at
present in China on an official visit, had
declared a $954 million relief package on July 1,
2006, but debt-tortured farmers saw little of it.
Nearly 2,000 farmers have killed themselves since
the prime minister's visit, says Tiwari.
Even as the NREG report made headlines,
six farmers killed themselves in the Vidarbha
region on January 10 and 12. In Bothbodan village,
18 farmers have committed suicide in the past 18
months. All 400 families in the village are in
debt, according to a news report in south Indian
daily The Hindu on January 13, and each family is
threatened with a suicide.
The Indian
government's lackadaisical approach to
agricultural problems is best exemplified in
Agriculture Minister Pawar finding time to be
president of the Board of Control of Cricket in
India. A minister handling one of the three most
important portfolios in the union cabinet
moonlighting as a busy sports administrator and
frequently traveling abroad to see cricket matches
might have been cause for scandal in some other
countries, but not yet in India. Worse, Pawar's
home state is Maharashtra, the epicenter of farmer
suicides in India.
Besides discrepancies
in governmental data and the findings of country's
most senior governmental auditors, disturbing
independent reports allege looting of public money
made available through NREG.
The Center
for Environment and Food Security, for instance,
has said it carried out a five-month survey in 100
villages of Orissa, in the east of the country,
and found that out of $186.5 million spent under
NREG during 2006-7, $127.2 million has been looted
by government officials of executing agencies.
In a 2,000-word letter to the prime
minister dated September 3, 2006, Ray says major
corruption involving NREG funds resulted in tragic
starvation deaths of adivasis (tribals) in
Orissa state, particularly in Kalahandi district,
one of the most backward regions in the country.
Ray accused the Orissa government of falsely
passing the starvation deaths as being caused by
cholera.
Ray, who sent copies of the
letter to the leader of the opposition in the Lok
Sabha (Lower House) , Lal Krishna Advani, Congress
Party president Sonia Gandhi and Communist Party
of India (Marxist) general secretary Prakash
Karat, said that "abject poverty and chronic
hunger manufactured by corrupt bureaucracy are the
main reasons behind these tragic deaths of
Adivasis". Ray told Asia Times Online he has not
yet received any direct response from the
government to his letter.
Ray says the
majority of tribals in Orissa barely subsist on
mango kernel gruel and wild leaves, and their
weakened immune system becomes susceptible to
diseases. "This tragedy repeats every year," says
Ray. "The historic anti-poverty NREG scheme was
launched to stop precisely this kind of tragedy."
The Indian government has sought inputs of
chief ministers of states on the CAG findings, and
some are far from bashful in publicly expressing
what they think of it. On January 9, the chief
minister of the backward eastern state of Bihar,
Nitish Kumar, scathingly told a media conference:
"Name one state where the program is running
properly. The scheme was launched in haste and has
much scope for leakages."
The CAG audit
points to key reasons for the mismanagement:
inefficient monitoring of funds, badly planned
work projects, improper accounting and funds
diverted for unauthorized purposes. Some
rare voices sound hopeful. The New Delhi-based
Right to Food Campaign, a network of organizations
and individuals working for India's food security,
is optimistic about NREG, while admitting it is
badly affected by corruption. "Given political
will, the program can succeed," Gurminder Singh of
the group's secretariat told Asia Times Online.
"The NREG is making some positive impact."
Indian farmers need more than stray
optimism and hope. January 15 is Pongal,
India's important harvest festival, and while rich
urbanites will be celebrating the festival with
new silk clothes, 32-dish vegetarian feasts and
juicy bites of sugar cane, India's poor farmers in
Bothbodan village, Maharashtra state, risk a fatal
feast of a bottle of pesticide.
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