(This news article is a three-part series. Part-III is published today. Part-I and Part-II can be read here.)
SRINAGAR: At a time when Jammu and Kashmir requires massive investment in drinking water, rural roads and irrigation, two CAG audits reveal a striking paradox: government departments were not merely struggling for money; they were repeatedly unable to use money already available to them.
Under Jal Jeevan Mission alone, against central allocations of ₹9,657.20 crore during 2019-20 to 2023-24, J&K received a net ₹5,686.55 crore after excluding the amount transferred to Ladakh.
The shortfall against allocation was therefore ₹3,970.64 crore.
The audit links the failure to receive full Central assistance to delays in utilisation and inability to fulfil conditions required for subsequent releases.
At one stage, persistent under-utilisation had caused idle Jal Jeevan balances to exceed ₹900 crore by March 2023.
The Department acknowledged problems during the first two years, but told auditors that implementation and utilisation improved from 2022-23. Yet physical completion remained far behind the scale of spending and ambition.
Of 3,253 Jal Jeevan schemes taken up from 2019-20 to 2023-24, only 1,440, or 44 per cent, had been completed by December 2024.
The government reported that by March 31, 2024, 14.43 lakh rural households, or 77.15 per cent, had Functional Household Tap Connections.
But the audit tested the programme against its wider objective: not simply installing taps but supplying adequate quantities of safe water regularly.
In four sampled districts, Kulgam, Anantnag, Kishtwar and Doda, only 429 of 853 schemes had been physically completed by November 2024.
Even for completed schemes, the Department had prepared no operation and maintenance plan and had not established a mechanism to ensure trained manpower was available at village level.
That meant assets created at considerable public expense had been commissioned without a clear institutional plan for keeping them operational. The CAG warned that their sustainability was consequently at risk.
Failed Water Tests Went No Further
There was another contradiction at the heart of a programme whose stated purpose includes safe drinking water.
The audit found that water samples failing tests in block and district laboratories were not referred to higher laboratories for further investigation.
Expenditure and releases for Water Quality Monitoring and Surveillance were also far below the levels provided for under programme guidelines.
The consequences cannot automatically be attributed to tap water, as the Department correctly cautioned, but the health data examined by auditors offered little evidence of the improvement the mission was designed to produce.
The CAG found no significant decline in waterborne diseases except in Doda.
In Kishtwar and Kulgam, where only 29 per cent and 36 per cent of sampled JJM schemes had been completed, respectively, waterborne disease showed an increasing trend over five years.
Even Anantnag, with 63 per cent completion, recorded no significant decline.
The Department said disease figures could not necessarily be linked to contaminated tap water because sanitation and other factors could also cause such illnesses.
That is a valid caveat. But it does not answer the separate audit finding that failed water-quality samples were not escalated for further investigation.
The audit also examined the machinery through which projects became contracts.
Among 44 sampled Jal Jeevan schemes, 33 experienced delays in contract awards ranging from two to 653 days beyond the prescribed period.
For 42 allotted works, agreements with contractors were signed with delays ranging from four to 638 days beyond the permitted seven days.
The Department attributed delays to COVID restrictions, the large number of schemes being processed simultaneously, poor tender response and manpower shortages.
The CAG nevertheless found the delays had cascading effects on implementation and created risks of cost escalation.
In some cases, tenders had even been invited before formal Administrative Approval and Technical Sanction. The Department said this occurred only in a small number of instances because of field constraints and that final allotment orders followed approval.
Same Pattern in NABARD Projects
An entirely separate audit of projects financed through the National Bank for Agriculture and Rural Development reveals remarkably similar weaknesses.
Between 2018-19 and 2022-23, the Government of India permitted Jammu and Kashmir to raise ₹3,900 crore in NABARD loans.
The UT actually availed ₹2,316.37 crore, or 59 per cent.
Among 263 projects due for completion by March 2023 in the audited universe, only 32, or 12 per cent, were completed.
The remaining 231 were either incomplete or had not started.
Against ₹844.17 crore released for the projects examined, expenditure was only ₹382.50 crore, leaving ₹461.67 crore unutilised.
The CAG found that projects sanctioned before departments had ensured encumbrance-free land, forest and statutory clearances, viable water sources and technically sound Detailed Project Reports.
Two Poonch road projects, from Eidgah Marhote to Solian and Kaloon to Haji, Shark Harayala via Dharana, were awarded to a contractor who, according to the audit, had not furnished mandatory evidence of experience in similar works.
His technical bids had actually been declared unresponsive. Yet the contractor received both works. By March 2023, ₹62 lakh had been spent.
The Department later told auditors that the original allotment was cancelled for non-performance, the contractor's ₹3.76 lakh bank guarantee was forfeited, and the remaining work was re-tendered in October 2025.
But, as the CAG pointedly observed, the reply was silent on the original question: why had the contracts been awarded to an ineligible bidder in the first place?
In Udhampur, auditors found another ₹10 lakh paid in excess to a road contractor after the Department added 4.88 per cent to bills totalling ₹2.05 crore.
The Department disputed that there had been an excess payment.
The CAG rejected the defence, saying there was no contractual or statutory basis for adding 4.88 per cent to the amount billed.
In Baramulla and Kupwara, meanwhile, auditors detected what they described as apparent double execution of identical components of two NABARD road works, resulting in irregular excess expenditure of ₹38.08 lakh.
Companies Without Current Accounts
Running parallel to these scheme-level failures is another governance problem.
Jammu and Kashmir had 42 public-sector enterprises under CAG jurisdiction as of March 2023. Twenty reported losses totalling ₹252.53 crore, while accumulated losses had completely eroded the net worth of 14 of 19 PSEs examined on that measure.
But even those figures come with a warning.
Of 34 government companies whose 2022-23 accounts were due, only four submitted them to the CAG by September 30, 2023.
Thirty were in arrears. Nineteen had accounts pending for three years or more, and in eight PSEs the delay in finalising financial statements ranged between five and 12 years.
The CAG's concern was not merely bookkeeping. Until accounts are finalised, government investments in these companies effectively remain outside meaningful legislative scrutiny.
The two audit reports therefore reveal a recurring administrative pattern across entirely different sectors.
In MGNREGA, money was spent while works remained incomplete. In Jal Jeevan, large balances remained unused while thousands of schemes awaited completion. Under NABARD, sanctioned borrowing was left unavailed and released funds remained idle. In public enterprises, accounts themselves lagged years behind.
And in the computer system designed to watch over government money, auditors discovered that some transactions could be altered without leaving an adequate trail showing who had changed them.
For an administration that increasingly presents digitisation, direct monitoring and financial discipline as evidence of improved governance, that may be the most consequential finding of all.