CAG Report Exposes Rs 172 Crore Loss and Systemic Irregularities in Sand Mining

A recent report by the Comptroller and Auditor General (CAG) has unearthed significant irregularities in sand mining operations in Telangana, leading to a staggering loss of Rs 172 crore in revenue.

The audit, titled ‘Sand Mining with Special Emphasis on Initiatives Taken to Curb Illegal Mining,’ covered the period from 2016-17 to 2020-21, focusing on three project offices of the Telangana State Mineral Development Corporation Ltd (TSMDCL) located in Jayashankar Bhupalpally, Bhadradri Kothagudem, and Karimnagar.

Among the findings, the CAG report revealed instances where contracts for sand raising were awarded to third parties by tribal development societies, in violation of established regulations. These tribal societies, despite being entrusted with the task, engaged non-local or non-tribal contractors for sand excavation, contravening the terms prohibiting subletting in the contracts. This practice not only undermined efforts to prevent exploitation of mineral resources by non-local entities but also resulted in an undue benefit of Rs 11.6 crore to the third-party contractors.

Moreover, delays in sand excavation were observed due to various reasons, including the state government’s failure to provide necessary clarifications on payment rates to sand-raising contractors and TSMDCL’s lack of action plans to adhere to agreed timelines with stakeholders. Consequently, the government suffered a substantial revenue loss of Rs 172 crore due to the delayed commencement of sand sales.

The audit also highlighted deficiencies in monitoring and oversight mechanisms within the sand mining operations. Few sand reaches and stockyards were equipped with CCTV cameras and weigh bridges, leading to instances of vehicle overloading during dispatch. Furthermore, vehicles transporting sand were not outfitted with GPS or radio frequency identification devices for tracking and monitoring purposes.

TSMDCL was found lacking in the formulation of appropriate stock policies and maintenance of accurate stock registers, further exacerbating the regulatory shortcomings identified by the CAG. These revelations underscore the urgent need for comprehensive reforms and stringent enforcement measures to address systemic deficiencies in the sand mining sector in Telangana.

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