Less than 20% of govt khadi units working, says CAG

livemint.com:

NEW DELHI : Only 18 out of the 92 departmental trading units of the Khadi and Village Industries Commission (KVIC) are functional, the Comptroller and Auditor General of India (CAG) has flagged amid a push for Khadi products. These units include the Central Sliver Plants and sales outlets named Khadi Gramodyog Bhavans. A CAG report showed that as of 31 March 2021, as many as 74 trading units were defunct.

The compliance audit evaluated the operations of the 18 functional units and supply chain management during 2017-18 to 2020-21. The audit also conducted a general scrutiny of 25 defunct departmental trading units to ascertain reasons and impact of closure. “During audit, it was observed that these initiatives could not meet the desired degree of success as there were many challenges and weakness in implementation," the report said.

It noted that despite less than 20% of the departmental trading units being able to continue operations, the KVIC has not done any analysis to identify the reasons for the units becoming defunct. It said the reasons for closure were not available for 11 out of 25 departmental trading units and in the case of three, the reasons and justifications were not fully convincing. More efforts by KVIC could have prevented their closure.

“In case of another two departmental trading units, private parties were generating considerable revenue through unauthorised sales of Khadi products indicating scope for revenue generation through these departmental trading units," it said. The development comes at a time when the government has been trying to promote Indian products through concepts like ‘Vocal for Local’, ‘Khadi for Nation’ and ‘Khadi for Fashion’. Queries sent to the MSME ministry and KVIC remained