CAG to audit crop insurance schemes in nine states

The Comptroller and Auditor General (CAG) will conduct a performance audit of crop insurance schemes in nine states to examine the efficacy of such initiatives in providing relief to farmers in the event of crop damage.

The performance audit will include examination of records of Department of Agriculture Cooperation and Farmers Welfare, Agriculture Insurance Company of India Limited, State Agriculture Department and other related departments, the RBI said while asking banks to provide access to related records to the auditor.

This audit is proposed to be conducted in the states of Andhra Pradesh, Assam, Gujarat, Haryana, Himachal Pradesh, Orissa, Maharashtra, Rajasthan and Telangana with the help of the offices of the Principal Accountant General/Accountant General (Audit) in the respective states, it said.

 Further, as crop insurance schemes are being implemented with the help of various banks, insurance companies and co-operative institutions, examination of the records of these organisations is necessary to ascertain whether schemes are being implemented effectively, it said.

In view of the above, you (banks) are advised to facilitate access to your records pertaining to crop insurance schemes to the audit teams…, the RBI said.

In another notification, RBI said that in view of the difficulties faced by farmers in areas affected by natural calamities, banks are advised to act with empathy.

Banks have been asked to consider restructuring and granting fresh loans without waiting for the receipt of the insurance claims, in cases where there is reasonable certainty of receipt of the claim.

As per RBI norms, while restructuring loans in the areas affected by natural calamities, banks are required to adjust the insurance proceeds, if any, receivable from the insurance company to restructured accounts in cases where they have granted fresh loans to the borrowers. PTI NKS NKD ABM

 Curated from CAG to audit crop insurance schemes in nine states

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