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'RIICO flouted rules to favour select firms'

DNA | Last Modified - Apr 14, 2012, 04:11 AM IST

CAG report said RIICO has no info about the industrial areas, which 1540.45 acres in Raj.
  • 'RIICO flouted rules to favour select firms'
    'RIICO flouted rules to favour select firms'

    RIICOJaipur: The report of the Comptroller Auditor General of India (CAG) has exposed serious irregularities in industrial promotions and planning discrepancies in the infrastructure activities carried out by the Rajasthan State Industrial Development and Investment Corporation Limited (RIICO).

    While these irregularities cost the state government crores of rupees, select industrial houses were swimming in the benefits by sidelining rules. The Union government’s top audit institute highlighted these facts and more, in its report drafted at the end of the financial year 2011.

    “Unit officers of the company [RIICO] largely failed to provide basic infrastructural facilities to entrepreneurs in industrial areas which affected the production and consequently the pace of the industrialisation in Rajasthan,” the report observed.

    The report said that the Infrastructure Development Committee (IDC) violated rules and made decisions on case-to-case basis, which helped some entrepreneurs gain undue benefits while causing loss of revenue to the state exchequer.

    For instance, IDC allotted a plot of one acres to Barmalt (India) Private Limited in the already saturated Manda Industrial Area without an auction. “We observed that the allotment was against the policy as it was to be done through the auction,” the report said.

    In another case of irregularity in land allotment, IDC, in 2006 gave 10 acres of land to United Breweries Limited in the Chopanki Industrial Area (Bhiwadi-II) in the sutured category. In this category, land is reserved for parks, roads and hospitals. Also, this area is a dark zone!

    The committee sanctioned the plot for Rs 1,000 per square meter. This was in violation of rules as the prevailing rates were between Rs1,590 and Rs1,800 per square metre in 2006. The unjustified subsidy on land caused a loss of Rs 1.36 crore to the exchequer.

    Scanning RIICO’s performance, the CAG report noted that its plans did not ensure development of thrust sectors envisaged in the industrial policy, like Auto Ancillary at Sitapura (Jaipur) and Textile at Jaipur and Jodhpur. Also, development of wool industry and handicraft sector at Bikaner was also not achieved even after 13 years.

    The report added that land under encroachment or litigation increased from 260.03 acres (worth Rs 7.8-crore) in 2004-05 to 651.37 acres (worth Rs 83.63 crores) in 2009-10 — an almost ten-fold rise.

    “RIICO has no information about the industrial areas, which some 1540.45 acres in the state. Thus, the improper planning and delay in providing information hampered industrial development and also led to blockage of the funds,” the report said.

    Commenting on the findings, RIICO managing director Rajendra Bhanawat said, “The plans are changed according to the market potential. Therefore, it cannot be said that RIICO failed to plan. In taking possession of land, sometimes litigation and law and order situation surface.”

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