210 Report on Demands for Grants (2018-19) of the Ministry of Doner

Home , Kaladan River, Tipaimukh Road

REPORT NO. 210

PARLIAMENT OF INDIA RAJYA SABHA

DEPARTMENT-RELATED PARLIAMENTAR Y STANDING COMMITTEE ON HOME AFFAIRS

TWO HUNDRED TENTH REPORT

DEMANDS FOR GRANTS (201 8-19) MINISTRY OF DEVELOPMENT OF NORTH EASTERN REGION

(PRESENTED TO RAJYA SABHA ON 4th APRIL, 2018) (LAID ON THE TABLE OF LOK SABHA ON 4th APRIL, 2018)

Rajya Sabha Secretariat, New Delhi April, 2018/Chaitra, 1940 (Saka)

Hindi version of this publication is also available

C.S. (H.A.)- PARLIAMENT OF INDIA RAJYA SABHA

DEPARTMENT-RELATED PARLIAMENTAR Y STANDING COMMITTEE ON HOME AFFAIRS

TWO HUNDRED TENTH REPORT

DEMANDS FOR GRANTS (2018 -19) MINISTRY OF DEVELOPMENT OF NORTH EASTERN REGION

(PRESENTED TO RAJYA SABHA ON 4th APRIL, 2018 ) (LAID ON THE TABLE OF LOK SABHA ON 4th APRIL , 201 8)

Rajya Sabha Secretariat, New Delhi April, 2018/Chaitra, 1940 (Saka)

C O N T E N T S

PAGES

1. COMPOSITION OF THE COMMITTEE (i)

2. PREFACE (ii)

3. ACRONYM (iii) - (vi)

4. REPORT 1 - 60

CHAPTER-I 1 - 5

OVERVIEW

CHAPTER-II 6 - 38

ASSESSMENT OF DEMANDS FOR GRANTS

CHAPTER-III 39 - 60

SCHEMES, POLICIES AND PROGRAMME

5. OBSERVATIONS/RECOMMENDATIONS - AT A GLANCE 61 - 71

6. RELEVANT MINUTES OF THE MEETINGS OF THE COMMITTEE * ……

7. ANNEXURES *

* to be appended at the printing stage

COMPOSITION OF THE COMMITTEE

(re-constituted w.e.f. 1 st September, 2017)

1. Shri P. Chidambaram - Chairman

RAJYA SABHA

2. Shri Pratap Keshari Deb 3. Shri K. Rahman Khan 4. Dr. V. Maitreyan 5. Shri Shamsher Singh Manhas 6. Shri Derek O'Brien 7. Shri Neeraj Shekhar 8. Shri K. Bhabananda Singh 9. Shri Ram Chandra Prasad Singh 10. Shri R.K. Sinha

LOK SABHA

11. Dr. Sanjeev Balyan 12. Shri S. Selvakumarachinnayan 13. Shri Adhir Ranjan Chowdhury 14. Dr. (Shrimati) Kakoli Ghosh Dastidar 15. Shri Ramen Deka 16. Shri Prataprao Ganpatrao Jadhav 17. Shri Mallikarjun Kharge 18. Shrimati Kirron Kher 19. Shri Ram Mohan Naidu Kinjarapu 20. Shri Kaushal Kishore 21. Shri Ashwini Kumar 22. Shri P. Nagarajan 23. Shri Baijayant "Jay" Panda 24. Shri Dilip Patel 25. Shri Lalubhai Babubhai Patel 26. Shri Natubhai Gomanbhai Patel 27. Shri Bheemrao B. Patil 28. Shri Mohammed Faizal PP 29. Shri Bishnu Pada Ray 30. Shri Prem Singh Chandumajra 31. Shri B. Sriramulu

SECRETARIAT

Shri P.P.K. Ramacharyulu, Secretary Shri Rohtas, Joint Secretary Shri Vimal Kumar, Director Dr. (Smt.) Subhashree Panigrahi, Additional Director Shri Bhupendra Bhaskar, Additional Director Shri Pritam Kumar, Under Secretary

(i)

PREFACE

I, the Chairman of the Department-related Parliamentary Standing Committee on Home Affairs, having been authorised by the Committee to submit the report on its behalf, do hereby present this Two Hundred Tenth Report on Demands for Grants (2018-19) relating to the Ministry of Development of North Eastern Region (DoNER).

2. Under Rule 272 of the Rules of Procedure and Conduct of Business in the Council of States, the Department-related Parliamentary Standing Committee on Home Affairs is mandated to consider the Demands for Grants of the related Ministries and make report thereon. In pursuance thereof, the Committee, in its sitting held on 16 th February, 2018 heard the presentation of the Secretary and other officials of the Ministry of DoNER as well as officers of the implementing Ministries/ Departments/ Agencies and considered the Demands for Grants (2018-19) of that Ministry.

3. The Committee, in its sitting held on 2nd April, 2018 considered and adopted the draft Report.

4. The Committee, while making its observations/recommendations, has relied mainly upon the following papers received from the Ministry of DoNER: -

(i) Detailed Demands for Grants (2018-19) pertaining to the Ministry of DoNER; (ii) Background Notes on the Demands for Grants (2018-19); (iii) Outcome Budget (2018-19) of the Ministry; (iv) Annual Report (2017-18) of the Ministry; (v) Written replies furnished by the Ministry to the Questionnaires sent to it by the Committee Secretariat; (vi) Presentation made by the Secretary of the Ministry; and (vii) Oral evidence and written clarifications given by the Ministry to the points/issues raised by the Members in the meeting of the Committee.

5. For facility of reference and convenience, the observations and recommendations of the Committee have been printed in bold letters in the body of the Report.

2nd April, 2018 P. Chidambaram New Delhi Chairman ..... Chaitra, 1940 (Saka ) Department- related Parliamentary Standing Committee on Home Affairs

(ii)

ACRONYMS

ADB Asian Development Bank APMC Agricultural Produce Market Committee APPRH Arunachal Pradesh Package of Roads and Highways AMPT Agia-Medhipara-Phulbari-Tura AAI Airport Authority of India ALGs Advance Landing Grounds BBJ The Braithwaite Burn and Jessop Construction Company Limited BSNL Bharat Sanchar Nigam Limited BBNL Bharat Broadband Network Limited BRO Border Road Organisation BTC Bodoland Territorial Council BG Broad Gauge BHQs Block Headquarters BFC Business Facilitation Centres CCEA Cabinet Committee on Economic Affairs CPSEs Central Public Sector Enterprises CPWD Central Public Works Department CMD Chairman & Managing Director CBRI Central Building Research Institute CMC Central Monitoring Committee CEO Chief Executive Officer CAMPA Compensatory Afforestation Fund Management and Planning Authority DHTC Dima Hasao Territorial Council DPR Detailed Project Report DoNER Development of North Eastern Region DHATC Dima Hasao Autonomous Territorial Council DGCA Director General Civil Aviation DDUGJY Deen Dayal Upadhyaya Gram Jyoti Yojana DPEs Department of Public Enterprises DHQ District Headquarter DBT Direct Benefits Transfer EAP Externally-aided Project EIA Environmental Impact Assessment EPC Engineering, Procurement, and Construction FGEs First Generation Entrepreneurs FPOs Farmers Producers Organization FPM Forest Fire Prevention and Management Scheme GBS Gross Budgetary Support GIM Green India Mission HEP Hydro-Electric Power

(iii)

HADP Hill Areas Development Programme IWAI Inland Waterways Authority of India IWMP Integrated Watershed Management Programme ISFR India State of Forest Report IFMS Intensification of Forest Management Scheme IWT Inland Water Transport IIM Indian Institute of Management IIFPT Indian Institute of Food Processing Technology IPDS Integrated Power Development Scheme IT Information Technology ITES Information Technology Enabled Services IITTM Indian Institute of Tourism and Travel Management IHM Institute of Hotel Management IDWH Integrated Development of Wildlife Habitat KAATC Karbi Anglong Autonomous Territorial Council KMTT Kaladan Multimodal Transit Transport MOU Memorandum of Understanding MDA Marketing Development Assistance MoS Memorandum of Settlement MTEF Medium Term Expenditure Framework MoCA Ministry of Civil Aviation MoD Ministry of Defence MHA Ministry of Home Affairs MG Meter Gauge MLIs Member Lending Institutions MSME Micro, Small and Medium Enterprises MoFPI Ministry of Food Processing Industries MFIs Micro Finance Institutions MOVCDNER Mission Organic Value Chain Development for North Eastern Region MEA Ministry of External Affairs MGNREGS Mahatma Gandhi National Rural Employment Guarantee Scheme NITI National Institution for Transforming India NETDC North East Tourism Development Council NES North Eastern States NHDL National Highways Double Lane NGO Non Governmental Organisation NERTPS North East Region Textile Promotion Scheme NEIST North East Institute of Science and Technology NEC North Eastern Council NLCPR Non-Lapsable Central Pool of Resources NER North Eastern Region NESIDS North East Special Infrastructure Development Scheme NEDFI North East Development Finance Institution NERAMAC North Eastern Regional Agricultural Marketing Corporation Limited

(iv)

NEHHDC North Eastern Handloom and Handicrafts Development Corporation NESRIP North Eastern States Roads Investment Programme NEEPCO North Eastern Electricity Power Corporation Ltd. NGO-MFIs Non-Government Organisation-Micro finance institutions NAP National Afforestation Programme NBFC Non-Banking Financial Company NERSDS North Eastern Road Sector Development Scheme NHIDCL National Highway and Infrastructure Development Corporation Limited NERPSIP North Eastern Region Power System Improvement Project NEIIPP North East Industrial & Investment Promotion Policy NEVF North East Venture Fund OFC Optical Fibre Cable ONE Organic North East PWDs Public Works Departments PMU Project Monitoring Unit PMJDY Pradhan Mantri Jan Dhan Yojana PMGSY Pradhan Mantri Gram Sadak Yojana PMKSY Pradhan Mantri Krishi Sinchayee Yojana PSUs Public Sector Units PAC Public Accounts Committee PGs Producer Groups POs Producer Organizations PMC Project Management Consultancy PPP Public-Private partnership PRASAD Pilgrimage Rejuvenation and Spiritual Augmentation Drive PMMY Pradhan Mantri Mudra Yojana PFC Power Factor Correction PDC Project Development Consultant REC Rural Electrification Corporation RBI Reserve Bank of India RCC Reinforced Cement Concrete RCS-UDAN Regional Connectivity Scheme- Ude Desh ka Aam Naagrik RGGVY Rajiv Gandhi Grameen Vidyutikaran Yojana R-APDRP Restructured Accelerated Power Development & Reforms Programme RITES Rail India Technical and Economic Service RGIIM Rajiv Gandhi Indian Institute of Management STINER Science & Technology Interventions in NER SIDF Social and Infrastructure Development Fund SLEC State Level Executive Committee SHGs Self Help Groups SARDP-NE Special Accelerated Road Development Programme for North East SAMPADA Scheme for Agro-Marine Processing and Development of Agro-Processing SCADA Supervisory control and data acquisition STG Steam Turbine Generator SPV Special Purpose Vehicle

(v)

TEDF Techno-Economic Development Fund TFCs Technology Facilitation Centres USOF Universal Services Obligation Fund UC Utilisation Certificate VRS Voluntary retirement scheme WFI World Food India WOC World Organic Congress

(vi)

REPORT

CHAPTER -I

OVERVIEW

1.1 Introduction

1.1.1 India’s North Eastern Region (NER) comprises of eight States - Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim and Tripura. The NER is unique in terms of growth opportunities as the region possesses the potential to develop into an economic powerhouse, being a vibrant source of energy, oil, natural gas, coal, and limestone, besides being endowed with India’s largest perennial water system in the river Brahmaputra and its tributaries. The NER is also home to a great variety of horticultural products, plantation crops, vegetables, spices, rare herbs and medicinal plants. The region also offers vast tourism opportunities, rare flora and fauna, breathtaking natural beauty, a rich culture of performing arts besides varied cuisine and handicrafts.

1.1.2 To coordinate the developmental efforts being taken by the Central and the State Governments in the NER, the Department of Development of North Eastern Region (DoNER) was set up in 2001. Subsequently, the Department was upgraded to a full-fledged Ministry in May 2004. The Ministry of DoNER implements the schemes of Non-Lapsable Central Pool of Resources (NLCPR) and the North Eastern Council (NEC) through the State Governments and some Ministries of the Central Government. It also provides funds for some Special Development Packages.

1.2 Coordination with Central Ministries and Departments

1.2.1 In October 1996, it was decided that Central Ministries/ Departments, unless specifically exempted, will set aside 10 per cent of their Plan Gross Budgetary Support (GBS) for the NER to ensure a quantum jump in budgetary resource-flow to the region and to fill the backlog and gaps in basic minimum services and infrastructure. Subsequently, funds for the NER are being allocated annually on a lump sum basis by the non-exempted Central Ministries/Departments at the BE and RE stages, under the Major Heads 2552 (for revenue expenditure), 4552 (for capital expenditure) and 6552 (for loan expenditure). These funds are expended under their respective functional schemes.

1.2.2 The Ministry of DoNER, being the nodal Ministry, coordinates with the various Ministries/ Departments and keeps track of expenditure under the mandatory 10 per cent GBS by the non-exempted Ministries/ Departments since its inception. This exercise is being undertaken on an annual basis and the allocation and actual expenditure figures by the respective Ministries/ Departments are collected, compiled and forwarded to the Ministry of Finance for vetting. The Annual Expenditure pertaining to the earmarked allocation by the non-exempted Ministries/ Departments from 2014-15 to 2017-18 is given in the following table:

(Rs. in Crore) Financial Total Earmarked Expenditure of Expenditure as Year Funds at RE stage earmarked funds percentage of earmarked funds (%) 2014-15 27381.17 24483.92* 89.41 2015-16 29669.22 31291.81* 105.48 2016-17 31738.58 29634.42* 93.37

2017-18 40971.69 35370.36^ - 2018-19 47994.88 (BE)

*expenditure figures are provisional subject to final vetting by MoF and expenditure exclusive of Ministry of Railways outlay in NE Region. ^ figures as on 15.02.2018 under release to NE States.

1.3 Central Pool of Resources for NER

1.3.1 In 1997-98, when it was found that the actual expenditure of Ministries/Departments for NER was less than the mandatory ceiling of 10 per cent, the Government took the decision to create a “Central Resource Pool” into which the un-utilised portion of the 10 per cent earmarked GBS would accrue at the end of the financial year. Since 1998-99, the annual surrendered amounts out of the earmarked outlays of all the non-exempted Central Ministries/Departments for NER have been accounted as accruals to this Pool and the annual expenditure of the Ministry under the NLCPR scheme is being accounted as withdrawal from the Pool. However, this is a notional pool, maintained on a proforma basis by the Ministry of Finance. The Ministry of DoNER monitors Ministry-wise expenditure/ surrendered amounts for the purpose of ascertaining the accrual to the NLCPR pool in consultation with the Ministry of Finance.

1.4 Re-appropriation Mechanism

1.4.1 The Ministry of DoNER has been conferred with the powers to review the quarterly expenditure of the non-exempted Ministries and recommend reallocation of likely surrendered amount to those Ministries/Departments, which have the absorptive capacity to implement additional approved schemes/programmes within the financial year.

1.5 Restructuring of the schemes of the Ministry of DoNER

1.5.1 The Annual Report 2017-18 of the Ministry of DoNER states that for continuation beyond 12 th Five Year Plan, the schemes of the Ministry, including the NLCPR scheme, have been re-structured as 100 per cent Central Sector Schemes, under an umbrella scheme namely, the North East Special Infrastructure Development Scheme (NESIDS) to meet the gaps in social and physical infrastructure in the region. Likewise, the schemes of the NEC are also being restructured as Central Sector schemes.

1.6 North Eastern Council (NEC)

1.6.1 The NEC was constituted as a statutory advisory body under the NEC Act 1971 and was set up on the 7 th November, 1972 at Shillong. The NEC Act, 1971 was amended by the Parliament in 2002 to ensure that the NEC acted as a 'regional planning body' and also to include the state of Sikkim along with the states of Assam, Manipur, Meghalaya, Nagaland, Tripura, Arunachal Pradesh and Mizoram, under its ambit.

1.6.2 The NEC is the nodal body entrusted with the task of ushering in rapid economic and social development of the North Eastern Region. The Council has as its members, the Governors and the Chief Ministers of the states mentioned above. Besides, three other members are nominated by the President who also nominates the Chairperson of the Council.

1.7 North Eastern Regional Agricultural Marketing Corporation (NERAMAC)

1.7.1 The North Eastern Regional Agricultural Marketing Corporation (NERAMAC) is one of the two Central Public Sector Enterprises (CPSEs) under the administrative control of the Ministry of DoNER. NERAMAC was set up to support farmers/ producers of the NER by

2 getting remunerative prices for their produce and bridging the gap between the farmers and the market and also to augment the agricultural, procurement, processing and marketing infrastructure of the NER.

1.7.2 To fulfill its objectives, NERAMAC helps the producers by sourcing and procuring their cash crops. Additionally, it makes market interventions to provide remunerative prices to the producers. It also helps the processing units by providing raw materials and also by arranging packaging materials. NERAMAC has a few retail outlets within the NER that directly sell various processed and value added products, produced locally, in the region.

1.8 North Eastern Handicrafts and Handlooms Development Corporation Limited (NEHHDC)

1.8.1 NEHHDC was set up in 1977 at Shillong, Meghalaya, with the mandate of promotion and development of handicrafts and handlooms sectors in the NER of the country. NEHHDC strives to develop and promote indigenous crafts of the region by connecting the craftsmen to prospective markets and consumers and thus, generating economic, cultural and social opportunities for the crafts people while adding cultural value for the consumers.

1.9 North Eastern Development Finance Corporation Limited (NEDFI)

1.9.1 The North Eastern Development Finance Corporation Limited (NEDFI) was incorporated as a public limited company under the Companies Act, 1956, on 9 th August, 1995 with an authorised capital of Rs. 500.00 crore and a paid up capital of Rs. 100.00 crore. NEDFI is also categorised as a Non-Banking Financial Company (NBFC) and was registered with the Reserve Bank of India on 20 th December, 2002.

1.9.2 At the time of its establishment, the Corporation was placed under the Ministry of Finance for administrative purpose. However, with the formation of the Ministry of DoNER, in 2004, the Corporation was placed under it.

1.9.3 NEDFI provides financial assistance to micro, small, medium and large enterprises for setting up industrial and infrastructure projects in the NER. It also provides microfinance through Non-Government Organisation-Micro Finance Institutions (NGO-MFIs). Besides financing, the Corporation also offers consultancy and advisory services to the state governments, private sector organisations and other agencies. NEDFI also conducts sector or state specific studies under its Techno-Economic Development Fund (TEDF) and is the designated nodal agency for disbursal of Government of India incentives to the industries in the NER under the North–East Industrial and Investment Promotion Policy.

1.10 Mandate and Responsibilities of the Ministry of DoNER

1.10.1 As per the Government of India (Allocation of Business) Rules, 1961, the Second Schedule (Rule 3), the subjects allotted to the Ministry of DoNER are as follows:-

(i) Matters relating to the planning, execution and monitoring of developmental schemes and projects of North Eastern Region including those in the sectors of Power, Irrigation, Roads and Communications. (ii) Hill Area Development Programme in North Eastern Region. (iii) Non-lapsable Fund for the North Eastern Region. (iv) North Eastern Council. (v) North East Development Finance Institution (NEDFI).

(vi) North Eastern Regional Agricultural Marketing Corporation Limited (NERAMAC). (vii) The Sikkim Mining Corporation Limited. (viii) North Eastern Handloom and Handicrafts Development Corporation (NEHHDC), Shillong. (ix) Road works financed in whole or in part by the Central Government in the NER. (x) Planning of road and inland waterways transport in the NER.

1.10.2 The Ministry of DoNER aims to give focused attention to address the special needs of the North Eastern Region. It coordinates with the various Ministries/Departments primarily concerned with development activities in the Region. However, the respective Ministries/Departments remain responsible for the implementation of programmes in their respective fields. The Ministry of DoNER implements various schemes, including schemes of NLCPR, and special packages through the State governments of the NER and some Central Ministries concerned.

1.11 Demand No. 23 and Schemes Being Implemented There Under

1.11.1 Demand No. 23, in the List of Demands for Grants 2018-19 pertains to the Ministry of DoNER and the budget of the Ministry includes the following schemes under various major- heads:

(i) Major Head 2052 (Secretariat General Services): Secretariat General Services covers the salaries and other administrative expenses of the Ministry of DoNER.

(ii) Major Head 2070 (Other Administrative Services): The allocation under this head covers other administrative services, relating to the salaries and other administrative expenses of the North Eastern Council.

(iii) Major Head 2250 (Other Social Services): The allocation under this head is for ‘Advocacy and Publicity and Capacity Enhancement for Governance in NER’, which replaces the old scheme of ‘Capacity Building and Publicity’. It is a sub scheme of the new scheme the ‘North East Special Infrastructure Development Scheme’ (NESIDS). The provision under ‘Advocacy & Publicity’ was for providing financial assistance for the promotion and advocacy of inherent strengths of the NER and for the dissemination of information about the government schemes and relevant technologies. The provision under the ‘Capacity Enhancement for Governance in NER’ was to fund training and capacity building of in-service personnel and government functionaries of the North Eastern States.

(iv) Major Head 2552 (North Eastern Areas):

(a) Schemes of North Eastern Council (NEC); (b) North East Special Infrastructure Development Scheme (NESIDS)– Programme; (c) NE Region Livelihood Project (Externally-aided Project); (d) NE States Road Project Management Unit; and (e) Support for Consultancy, Monitoring, Third Party Evaluation, and Impact Assessment studies, etc., under the Non Lapsable Central Pool of Resources Scheme.

(v) Major Head 3601(Grants- in- aid to State Governments):

(a) Central Pool of Resources for North Eastern Region (NLCPR–State Scheme); (b) North Eastern Council - Special Development Project; (c) North East Road Sector Development Scheme- (Externally-aided Project) (Earlier known as NESRIP-EAP); (d) Special Package for Bodoland Territorial Council; (e) Special Package for Karbi Anglong Territorial Council; (f) Special Package for Dima Hasao Territorial Council; and (g) Hill Area Development Programme.

(vi) Major Head 4552 (Capital Outlay on North Eastern Areas):

(a) Schemes of North Eastern Council (Capital outlay); (b) Non-Lapsable Central Pool of Resources for North Eastern Region (NLCPR)-Central; (c) North East Road Sector Development Scheme-Programme Component; and (d) Schemes under the Social and Infrastructure Development Fund (SIDF).

(vii) Major Head 6851–(Loans for Village and Small Industries):

(a) Working Capital Loan to the North Eastern Regional Agricultural Marketing Corporation Limited (NERAMAC); and (b) Working Capital Loan to North Eastern Handicrafts & Handlooms Development Corporation Limited (NEHHDC)

(viii) Major Head 6885 (Other loans to Industries & Minerals): Loan to the North Eastern Development Finance Corporation Limited (NEDFI)

CHAPTER-II

ASSESSMENT OF DEMANDS FOR GRANTS

2.1 Budget at a Glance

2.1.1 The Ministry of Development of North Eastern Region (DoNER) has been allocated a total net budget of Rs. 3000.00 crore for the financial year 2018-19, of which Rs. 2326.00 crore is under the Revenue head and Rs. 674.00 crore is under the Capital head.

2.1.2 The budgetary provision of the Ministry of DoNER for 2018-19 and its variation over BE 2017-18 in actual terms as well as in percentage terms are given below: (Rs. in crore) BE RE BE Variation in BE Variation in BE 2017-18 2017-18 2018-19 2018-19 over BE 2018-19 over 2017-18 RE 2017-18 In Rs. (In %) In Rs. (In %) Revenue 2084.45 2283.45 2326.00 241.55 (11.58%) 42.55 (1.86%) Capital 598.00 399.00 674.00 76.00 (12.70%) 275.00 (68.92%) Total 2682.45 2682.45 3000.00 317.55 (11.83%) 317.55 (11.83%) 2.2 Utilisation of Funds during the Last Three Years

2.2.1 The Ministry furnished a comparative statement of the Budget Estimates, Revised Estimates and Actual Expenditure for 2015-16, 2016-17 and 2017-18 in respect of the schemes which are given below: (Rs. in crore) 2015-16 2016-17 2017-18 % % % utilisati utilisati utilisatio Plan on as on as n as BE RE Actuals BE RE Actuals BE RE Actuals* Schemes compar compar compare ed to ed to d to BE BE BE NEC 773.00 773.00 774.11 100.14% 813.60 935.52 979.91 120.44% 940.70 1040.70 641.09 68.15% NLCPR- 975.00 607.10 606.62 62.21 % 700.00 650.00 647.29 92.47% 700.50 701.06 644.42 91.99% State # NLCPR 90.00 150.00 149.96 166.62% 200.00 200.00 190.00 95% 369.00 175.00 57.63 15.61% Central 10.50 7.12 6.37 60.66% 73.00 70.21 59.23 81.13% 52.00 52.00 30.85 59.32% A & P**

CB &TA** 16.00 12.88 12.88 80.5% NERLP 15.00 120.00 119.95 799.66% 150.00 174.00 173.95 115.96% 150.00 215.00 144.95 96.63% 24.50 124.50 124.50 508.16% 150.00 150.00 150.00 100% 150.00 180.00 134.23 89.48% NERSDS- EAP (NESRIP)

0.50 0.50 0.50 100% 2.00 2.00 1.67 83.5% 2.00 0.66 0.10 5% NESRIP PMU 00.00 75.00 75.00 - 150.00 150.00 150.00 100% 150.00 150.00 6.00 4% NERSDS

225.00 00.00 00.00 NE Road 0% Re-named as NERSDS Corporation

50.00 30.00 30.00 60% 50.00 50.00 50.00 100% 50.00 50.00 23.46 46.92% BTC

00.00 6.00 5.15 - 30.00 30.00 3.44 11.46% 40.00 40.00 1.50 3.75% KAATC

00.00 37.32 37.24 - 20.00 20.00 0.08 0.4% 30.00 30.00 23.37 77.9% DHATC

TOTAL 2179.50 1973.42 1942.28 89.11% 2338.60 2431.73 2405.57 102.86% 2634.20 2634.42 1707.6 64.82% 0 170.00 70.00 49.88 29.34% 170.00 100.00 47.77 28.1% 110.00 55.00 46.91 42.64% SIDF^ *As on 08.02.2018 # includes expenditure on consultancy, monitoring and third party evaluation under NLCPR . ^: outlay outside GBS of M/DoNER **The two schemes were merged in 2016-17, and renamed as Capacity Building and Publicity. The provision for Capacity Building was increased in 2016-17 to cater to the skilling needs of NER. However, the Capacity Building Component was transferred to the Ministry of Skill Development and Entrepreneurship along with a Budget Provision of Rs. 25.00 crore in 2016-17.

2.2.2 The Committee takes strong exception to the low utilisation of allocation, i.e. 29.3 per cent in 2015-16, 28.1 per cent in 2016-17 and 42.6 per cent in 2017-18 under the Social and Infrastructure Development Fund (SIDF) in the allocations granted at BE Stage. The Committee had also expressed its anguish over the dismal utilisation under this Fund in its 202 nd Report on Demand for Grants (2017-18) of the Ministry of DoNER. In its action taken notes on the report, the Ministry had taken the plea that the poor utilisation during 2016-17 was due to non-submission of the alternative projects of bigger size by the State Governments after scrapping of the projects identified earlier that were having small envelope size. However, the Ministry had further stated that the State Governments had revisited their proposals and had resubmitted projects of higher estimated cost subsequent to which the projects were identified against the fund available and no balance fund was available to sanction any more projects under the SIDF. The Committee had noted the said reply of the Ministry with the hope that all the projects identified would be allocated funds under this scheme and would be completed on time. However, the Committee is disappointed to note that during 2017-18, the allocation under SIDF has been reduced at the RE stage. The Committee, therefore, strongly recommends that the Ministry must furnish a detailed project-wise utilisation schedule of funds under SIDF and the steps taken to improve the utilisation.

2.2.3 The budgetary provisions for BE 2018-19 and the variation between the allocations in BE 2017-18 and RE 2017-18 (in percentage terms), and RE 2017-18 and BE 2018-19, in respect of the Schemes and Non-schemes of the Ministry, are given in the following table:

Outlay under Schemes (Rs. in crore) Schemes BE BE Variation RE BE Variation 2017-18 2018-19 [in %] 2017-18 2018-19 [in %]

NLCPR-State 700.50 701.06 0.08 701.06 692.00 -1.29 NESIDS 0.00 0.00 - 0.00 130.00 100.00 NEC 940.70 1040.70 10.63 1040.70 925.00 -11.12 NLCPR-Central 369.00 175.00 -52.57 175.00 310.00 77.14 CB & P / A & P and 52.00 52.00 0.00 52.00 20.00 -60.00 CEGNER NERLP 150.00 215.00 43.33 215.00 180.00 -16.28 NERSDS-EAP 150.00 180.00 20.00 180.00 333.27 85.15

NESRIP-PMU 2.00 0.66 -67.00 0.66 1.00 51.52 NERSDS- Programme 150.00 150.00 0.00 150.00 250.00 66.67 HADP 0.00 0.00 - 0.00 30.00 100.00 BTC 50.00 50.00 0.00 50.00 20.00 -60.00 KAATC 40.00 40.00 0.00 40.00 40.00 0.00 DHATC 30.00 30.00 0.00 30.00 20.00 -33.33 TOTAL 2634.20 2634.42 0.01 2634.42 2951.27 12.03 SIDF 110.00 55.00 -50.00 55.00 60.00 9.09

(Rs. in crore) Non-Scheme BE RE Variation [in RE BE Variation 2017-18 2017-18 %] 2017-18 2018-19 [in %] Secretariat M/o DoNER 14.25 14.03 -1.54 14.03 14.73 4.88

Loan to NEDFi 30.00 30.00 0.00 30.00 30.00 0.00 Loan to NEHHDC 2.00 2.00 0.00 2.00 2.00 0.00 Loan to NERAMAC 2.00 2.00 0.00 2.00 2.00 0.00 TOTAL 48.25 48.03 -0.46 48.03 48.73 1.44

2.3 Projection of outlays for the Schemes to be undertaken by the Ministry during the next three years

2.3.1 With the end of the 12 th Plan in 2016-17, the traditional Five-Year development planning also came to an end. The Ministry of DoNER, in its background note, informed the Committee that it has identified key focus areas in the Medium Term Expenditure Framework (MTEF) in alignment with the predictability of financial resources during the 14 th Finance Commission Award period. The MTEF projections in respect of the Ministry of DoNER were made by the Ministry of Finance in the Medium Term Expenditure Framework Statement laid before Parliament as required under the Fiscal Responsibility and Budget Management Act, 2003 which is as under:-

(Rs. in crore) Year Revenue Capital Total 2018-19 2189.82 633.88 2823.70 2019-20 2343.46 700.00 3043.46

2.3.2 A three year action document for the period 2017-18 to 2019-20 aligned to the predictability of financial resources during the 14th Finance Commission Award period, has been prepared. The elements of an Inter-Ministerial Coordinated Strategy for the period from 2017-18 to 2023-24 have also been identified. In the key focus area of improving connectivity, the Ministry of DoNER monitors initiatives in road, rail and telecom sector in close coordination with the implementing Ministries/Departments and also identifies gaps in social and physical infrastructure which it strives to bridge through its own and NEC schemes. It also makes efforts to accelerate sustainable growth of the region, particularly keeping in view its innate strength in organic farming and potential of processed products, handlooms and handicrafts, tourism, bamboo and medicinal & aromatic plants to promote livelihood creation and entrepreneurship.

2.4 Revenue Section

2.4.1 The Ministry of DoNER informed the Committee that the total revenue outlay has been enhanced to Rs. 2326.00 crore in BE 2018-19 as compared to Rs. 2084.45 crore in BE 2017-18 due to an overall increase in the allocation. Further, the rise is due to an increase in the allocation for the North East Road Sector Development Scheme from Rs. 150.00 crore to Rs. 337.27 crore as this ADB assisted Road Development Programme is progressing at a fast pace.

2.4.2 The Committee sought to know the demands projected by the Ministry of DoNER for the year 2018-19 and the expenditure incurred during 2017-18 under each major head of revenue section. The Ministry furnished the details as under:-

(Rs. in crore) Funds Shortfall Increased/ Name of the Expenditure Utilisation BE BE from the BE RE Decreased Scheme / 2017-18* of Funds 2018-19 2018-19 Projected 2017-18 2017-18 at RE Head (%) (Projected) (Granted) Amount Stage [In Rs.] (%) Secretariat - 14.25 14.03 1.54 12.11 86.32 17.16 14.73 2.43 Ministry NEC Establishment 15.70 15.70 0.00 12.70 80.89 19.00 19.00 0.00 (MH-2070) Schemes of NEC 395.67 287.47 27.35 180.70 62.86 606.00 321.00 285.00 (MH – 2552) NEC Special Development 484.33 697.53 -44.02 427.88 61.34 1335.00 505.00 830.00 Project (MH- 3601) NEC -Total 895.70 1000.70 -11.72 621.28 62.08 1960.00 845.00 1115.00 NLCPR-State 700.50 701.06 -0.08 631.93 90.14 692.00 NESIDS 0.00 0.00 - 0.00 - 1800.00 130.00 948.00 HADP 0.00 0.00 - 0.00 - 30.00 CB & P / A & P and 52.00 52.00 0.00 29.76 57.23 55.00 20.00 35.00 CEGNER NERLP 150.00 215.00 -43.33 144.95 67.42 180.00 180.00 0.00 NERSDS- EAP 150.00 180.00 -20.00 125.18 69.54 150.00 333.27 -183.27 (NESRIP) NESRIP 2.00 0.66 67.00 0.09 13.64 2.00 1.00 1.00 PMU BTC 50.00 50.00 0.00 23.46 46.92 50.00 20.00 30.00 KAATC 40.00 40.00 0.00 1.50 3.75 40.00 40.00 0.00 DHATC 30.00 30.00 0.00 23.37 77.90 30.00 20.00 10.00 TOTAL 2084.45 2283.45 -9.55 1613.63 70.67 4284.16 2326.00 1958.16 * (till 31.01.2018)

2.4.3 The Committee was informed that Rs. 2326.00 crore was allocated in BE 2018-19 vis-a- vis the amounts projected i.e. Rs. 4284.16 crore for its various schemes. The allocations for the Schemes of NEC (Major Head-2552) and for scheme of NEC Special Development Project (Major Head 3601) were less than the projected demand. The total allocation for NLCPR-State and the new schemes of North East Special Infrastructure Development Scheme (NESIDS) and Hill Area Development Programme at Rs. 852.00 crore against the projected demand of Rs. 1800.00 crore is likely to affect infrastructure development in the North Eastern Region.

2.4.4 The Committee expresses its displeasure that there is a shortfall of Rs. 1958.16 crore in the funds allocated to the tune of Rs. 2326.00 crore in BE 2018-19 vis-a-vis the amounts projected i.e. Rs. 4284.16 crore by the Ministry for its various schemes. The shortfall is too steep, particularly under the schemes of the NEC and North East Special Infrastructure Development Scheme and it will adversely affect infrastructure development in the North Eastern Region. The Committee, therefore, strongly recommends that the Ministry of DoNER must pursuade the Ministry of Finance to allocate a larger amount of funds for these schemes at RE stage in 2018-19.

2.5 Capital Section

2.5.1 The Committee sought to know the demands projected by the Ministry for the year 2018- 19 and expenditure incurred during 2017-18 under each major head of capital section. The Ministry furnished the details as under:-

(Rs. in crore) Name of the BE RE Reduction Expenditure Utilisation BE BE Shortfall Scheme / Head 2017-18 2017-18 at RE 2017-18 % 2018-19 2018-19 from the Stage (%) (till 31st Jan, (Projected) (Granted) Projected 2018) Amount [In Rs.] NEC-Airports 40.00 35.00 12.50 0.41 1.17 74.55 40.00 34.55 and Housing (4552) Const / Imp of 5.00 5.00 0.00 5.00 100.00 10.00 40.00 -30.00 Roads through BRO (MH- 4552) NLCPR - 369.00 175.00 52.57 57.06 32.61 307.00 310.00 -3.00 Central NERSDS - 150.00 150.00 0.00 6.00 4.00 500.00 250.00 250.00 Programme SIDF 110.00 55.00 50.00 46.09 83.80 60.00 60.00 0.00 Loan to 2.00 2.00 0.00 2.00 100.00 9.40 2.00 7.40 NERAMAC Loan to 2.00 2.00 0.00 0.00 0.00 2.00 2.00 0.00 NEHHDC NEDFi 30.00 30.00 0.00 30.00 100.00 30.00 30.00 0.00 Total - Capital 708.00 454.00 35.88 146.56 32.28 992.95 734.00 258.95 Section

2.5.2 The Committee sought to know the reasons for the drastic reduction in the capital outlay from Rs. 708.00 crore in BE 2017-18 to Rs. 454.00 crore in RE 2017-18. The Ministry informed the Committee that there was a reduction in RE 2017-18 as compared to BE 2017-18 in the schemes of the NEC, NLCPR Central and SIDF. Under the NEC Capital Head (Airports & Housing) there was reduction of Rs. 5.00 crore at the RE stage from the provision of Rs. 40.00 crore at the BE stage. The provision was made anticipating the demand by the Airports Authority of India for completion of ongoing projects. The proposal for revision of costs is under examination and, therefore, the reduction of outlay at RE stage.

2.5.3 Under the NLCPR Central Scheme, funds were provided for the Agartala - Akhaura Rail Link project and for checking erosion of Majuli Island in Assam. In the former case, the Railways was not able to spend the allocated funds due to the delay in getting possession of acquired land. In the latter case, the Brahmaputra Board started work only in December 2017,

10 and was not able to spend the allocated amount by 31 st March and hence there was a reduction from Rs. 369.00 crore in BE 2017-18 to Rs. 175.00 crore at RE stage.

2.5.4 The reduction in allocation for the SIDF from Rs. 110.00 crore in BE 2017-18 to Rs. 55.00 crore in RE 2017-18 was due to non-submission of utilisation certificates, Inspection Reports and other relevant documents by the State Governments.

2.5.5 The Committee observes that an allocation of Rs. 250.00 crore has been made under the NERSDS–Programme as against the projected amount of Rs. 500.00 crore. The Committee feels that this shortfall of 50 per cent may adversely affect the implementation of several road projects under this scheme. The Committee, therefore, recommends that the Ministry of DoNER should strive to achieve a higher utilisation in the first half of 2018- 19 and pursue the Ministry of Finance to enhance allocation at RE stage in 2018-19.

2.6 Secretariat

2.6.1 The following table shows allocation under Revenue head:

(Rs. in crore) Actual BE RE BE 2016-17 2017-18 2017-18 2018-19 Revenue 13.34 14.25 14.03 14.73 Capital ------Total 13.34 14.25 14.03 14.73

2.6.2 The expenditure incurred under this head in 2017-18 (up to 31 st January, 2018) is Rs. 12.11 crore which works out to 86.32 per cent of RE 2017-18 of Rs. 14.03 crore.

2.6.3 The Committee sought to know the fiscal measures being adopted to rationalise the expenditure under this head. In response, the Ministry informed the Committee that there is a decrease of Rs. 14.03 crore in allocation in RE 2017-18 from Rs. 14.25 crore in BE 2017-18. The BE 2018-19 has been increased to Rs. 14.73 crore to provide for an increase under the salary head. There has been no increase in the non-salary component. Rationalisation is proposed to be achieved through strict compliance of all instructions issued by the Ministry of Finance from time to time, including instructions on economising expenditure.

2.6.4 The Committee emphasizes that all instructions issued by the Ministry of Finance from time to time on economizing and rationalizing of expenditure should be scrupulously followed by the Ministry of DoNER.

2.7 North East Council (NEC)

2.7.1 The NEC is a statutory organisation for the eight North-Eastern States. As per its mandate, the NEC takes up schemes which normally benefits the entire region and also fills into the gap areas not covered under Central Sector or Centrally Sponsored Schemes or Schemes not covered under the State Plans. Inter-state roads, power transmission lines, funding of institutions which cater to the entire region, development of social infrastructure in the remote, border and hilly areas, giving support to regional sports events, investors meet, etc. are some of the areas covered by the NEC schemes. These schemes are formulated based on the recommendations emanating out of the deliberations in the plenary meeting of the NEC, the Regional Plan prepared by the NEC and the broad map given in the NER Vision 2020 document.

2.7.2 The Central Sector Schemes/ Projects of the Council intend to ensure integrated and balanced socio-economic development of the region. The overall policy is that the NEC would work towards realisation of the goals and objectives in the Regional Plan prepared by the NEC.

2.7.3 The Committee was informed that the North Eastern Council has put in place the following plans in its endeavour for achieving a balanced regional economic growth and development:-

(i) Preparation of integrated and holistic regional perspective plans to achieve specific short-term and long-term objectives by taking into account the aspirations, needs and sensitivities of the people of the region. (ii) Identifying the strengths of the region and focusing on the opportunities for accelerating the pace of socio-economic development in the NER through participatory planning and implementation. (iii) Synergising and building convergence in the efforts of Central/State Governments/other stakeholders for balanced development of the region. (iv) Evolving a coordinated common approach for all agencies working for the development, public order and security in the region. (v) Evolving and aiding in the formulation of innovative and appropriate policies and strategies for the entire region for its all-round rapid development.

2.7.4 The regional plans are formulated by the NEC in a holistic manner on common concerns, objectives, aims and goals in consultation with the various stakeholders. The NEC schemes are sub-divided along several sectors which more or less conformed to the sectors available in the erstwhile Planning Commission. The major sectors of the NEC are Transport & Communication, Power Development, Agri & Allied, Tourism, Human Resource Development, Industries, Irrigation & Flood Control and Watershed Management, Medical & Health, Science & Technology, etc.

2.8 Schemes of NEC

2.8.1 The following table details the allocation to the NEC under Revenue and Capital head in BE 2018-19 against the actual expenditure during 2016-17 and BE & RE 2017-18:-

(Rs. in crore) Actual BE RE BE 2016-17 2017-18 2017-18 2018-19 Revenue 402.76 411.37 303.17 340.00 Capital 39.08 40.00 35.00 40.00 Total 441.84 451.37 338.17 380.00

2.8.2 The Committee was apprised of the following NEC projects:-

(i) Continuation of the on-going projects under various schemes of the NEC, with the existing funding pattern till March 2020.

(ii) Extension of 100 per cent centrally funded North Eastern Road Sector Development Scheme (NERSDS) at an estimated cost of Rs. 1000.00 crore for up-gradation of important inter-state roads.

(iii) Provision for on-going and new projects in specified sectors on 100 per cent Central Funding to ensure optimization of resources through convergence of efforts of various Ministries/Departments.

2.8.3 The Committee was apprised of the new projects that have a regional character and would have sub-components in various states as part of the entire Scheme. The NEC has been advised to take up the projects with a minimum project size of Rs. 20.00 crore, to the extent possible and shall follow the cafeteria approach for selection of projects under the State component. For the State component (60%), the available resources to the States shall be known on the basis of normative allocation formula.

2.8.4 The allocation of Rs. 451.37 crore in BE 2017-18, under the Schemes of the North East Council, was reduced to Rs. 338.17 crore at RE stage.

2.8.5 The Ministry informed the Committee that the major reduction of Rs.108.20 crore was under Major Head (MH) 2552. The reasons for this reduction were due to the non-receipt of Utilisation Certificates and a decreased demand for projects under this Head. There was a greater demand for releases towards ongoing projects under Major Head 3601 and accordingly, the amount of Rs. 108.20 crore has been proposed to be re-appropriated to Major Head 3601. Under Major Head 4552, a reduction of Rs. 5.00 crore was necessitated due to the non-receipt of Utilisation Certificates.

2.8.6 The expenditure incurred upto 31 st January, 2018 was Rs. 280.03 crore. The details are given in the table below:

(Rs. in crore) Major BE 2017-18 RE 2017-18 Expenditure till Head 31/01/18 2552 395.67 287.47 256.44 2070 15.70 15.70 12.71 4552 40.00 35.00 10.88 Total 451.37 338.17 280.03

2.8.7 In the meeting chaired by the Secretary, DoNER to review the NEC projects, the issue of non-receipt of UCs was taken up and the NEC was directed to rectify the situation. The Secretary, NEC has since taken up matter with the States in a series of meetings at the Chief Secretary level. A special drive in the form of ‘UC Clearance fortnight’ was also organised to reduce the level of pendency. The outcome of these initiatives has been encouraging and, as a result, as many as 113 projects could be formally closed this year till January, 2018.

2.8.8 The projected demand under Capital outlay for the schemes of NEC for 2018-19 was Rs. 40.00 crore. The activities carried out under the Head are support for improvement of airports in the NER, housing for the NEC Staff and NEC Guest House. Since the support for improvement of airports in the NER given to Airport Authority of India is in the nature of gap funding, it is felt that the amount will be sufficient.

2.8.9 The schemes undertaken by the NEC for 2017-18 are, in fact, the continuation of the schemes formulated for the NEC during the 12 th Five Year Plan. Out of the sector-wise allocation, 98.94 per cent was spent on the power sector, 60.89 per cent transport & communication, 60.10 per cent the agri & allied sector, 84.60 per cent human resource development and 73.56 per cent on irrigation & flood control.

2.8.10 As far as achievements are concerned, the NEC has made significant achievements in the construction of roads, power transmission projects, construction of Inter-State Bus Terminus and Inter-State Truck Terminus, improvement of airport infrastructure, etc. The NEC completed 113 projects during the period.

2.8.11 The Committee appreciates the role of the NEC in formulation of regional plans for integrated and balanced socio-economic development of the NER. The Committee also takes note of the efforts made by the NEC in addressing the issue of non-receipt of utilisation certificate and the decreased demand for projects under the Major Head 2552 and taking appropriate steps by re-appropriating the amount of Rs. 108.20 crore from Major Head 2552 to ongoing projects under Major Head 3601. However, the Committee desires that the NEC and the Ministry of DoNER must take necessary steps to enhance the absorption capacity of projects under Major Head 2552 so that the allocated funds are fully utilised in such projects. The Committee also hopes that after the special drive in the form of UC clearance fortnight, there would not be any pendency in the receipt of Utilisation Certificates.

2.9 Special Development Projects

2.9.1 The NEC schemes under Special Development Projects (MH-3601) are implemented through the State Governments under the 90:10 funding in sectoral schemes of NEC. Projects to NEC are proposed by the State Governments through their Annual Priority Lists.

2.9.2 The following table shows the allocation under Revenue Head Special Development Projects in BE 2018-19 against actual expenditure during BE 2016-17 and RE 2017-18:-

(Rs. in crore)

Actual BE RE BE 2016-17 2017-18 2017-18 2018-19 Revenue 533.12 484.33 697.53 505.00 Capital ------Total 533.12 484.33 697.53 505.00

2.9.3 Against the allocation of Rs. 697.53 crore at RE stage in 2017-18, a sum of only Rs. 505.00 crore has been allocated at the BE 2018-19 stage. The Committee wanted to know the reasons for this reduction and the actual expenditure upto 31 st January, 2018. In response the Ministry stated that the NEC schemes have now been categorised as Central Sector Schemes. Schemes of North East Council–Special Development Projects are in the nature of Centrally Sponsored Schemes under MH-3601. Special dispensation from the Ministry of Finance has been obtained to clear liabilities of ongoing projects till 2019-20 and, therefore, the reduction has taken place. The Ministry informed that they have kept the provisions under MH 3601 to clear ongoing liabilities and the said provisions would be reducing gradually till 2019-20. The actual expenditure till 31 st January, 2018 under MH 3601 was Rs. 437.00 crore.

2.9.4 During the Committee's meeting held on 16 th February, 2018, when the Committee sought to know the reasons for incurring only Rs. 437.00 crore as expenditure up to 31 st January, 2018 and how the remaining expenditure of Rs. 260.00 crore would be incurred in the next two months of the current financial year. The JS&FA, M/o DoNER explained that some bills were in the pipeline and the Ministry has sent the bills for re-appropriation which were expected to be claimed/ settled soon and the Ministry would be seeking a waiver of 15 per cent expenditure during the last month. The Secretary, NEC added that the NEC was asked not to spend money on new projects till the approval of the EFC was granted. Therefore, the NEC could not spend

14 any money on the new projects. The EFC meeting was held on 28 th December, 2017, therefore, from that date, the NEC could spend money on new projects. Responding to the query regarding re-appropriation of funds, the Secretary, M/o DoNER explained that in order to complete the ongoing schemes, the Ministry had got the re-appropriation done. Thereafter the funds got transferred from the NEC schemes to the Schemes of NEC (Special Projects).

2.9.5 The Committee observes that the NEC intends to incur expenditure to the tune of Rs. 260.00 crore (as against the total allocation of Rs. 697.53 crore in RE 2017-18 under Major Head 3601 i.e. Special Development Projects. The actual expenditure till 31 st January, 2018 is Rs. 437.00 crore) in the last month of the current financial year whereas, the fiscal rules indicate that the guillotine would apply in case the NEC spends more than 33 per cent of the allocated money in the last quarter. The Committee wonders as to how the NEC would spend Rs. 260.00 crore which is more than one third of the total expenditure in the last month. The Committee feels that since, in the last month, the NEC cannot spend more than 15 per cent of allocated money, it will result in a huge unspent sum and consequent drastic reduction of allocation to the tune of Rs. 505.00 crore in Major Head 3601 in BE 2018-19.

2.9.6 The Secretary, M/o DoNER apprised the Committee that Rs. 250.00 crore was given additionally to NERSDS, the Inter-State Roads Scheme. So, the Ministry has advised the NEC to take up only bigger projects in the roads sector. In the NERSDS, the Inter-State Roads Scheme, there are two components. The first one is Externally aided project (EAP). The NEC could not spend money under this Head in time because it was advised to wait till the EFC gave its clearance. The EFC had approved it on 13 th December, 2017. Most of these roads had been entrusted to the CPWD for which the NEC was going to transfer the entire amount there within the month of February, 2018. When the Committee asked to explain whether transferring money is the same as that of the expenditure, the Secretary, NEC stated that the transfer should be assumed as expenditure since the projects would be taken up by the CPWD on a turnkey basis.

2.9.7 The Committee takes note of the submission of the Secretary, NEC that the moment the NEC transfers the money to the CPWD, it would be assumed that it has been spent. The Committee finds this response of the NEC to be very unsatisfactory. The Committee observes that if the NEC transfers the money in the month of February or March, the CPWD will find it difficult to spend and most probably it will lapse, which is highly objectionable. The Committee also observes that simply transferring the funds does not mean that it would be spent by the end of the Financial Year for the intended purpose and recommends that this distinction should be clearly defined and taken into account in future projects.

2.9.8 The NEC as on 31 st January, 2018 has a committed liability of Rs. 1403.86 crore under Special Development Projects. The projected demand under this head for the year 2018-19 was Rs. 505.00 crore. Since the amount is for clearing liabilities of ongoing projects, the amount should be sufficient.

2.9.9 The Committee feels that the Government should make a one-time provision for the NEC towards meeting the committed liability to the tune of Rs. 1403.86 crore so that the NEC can start implementation of the projects without the burden of a large committed liability.

2.10 Central Pool of Resources for North East and Sikkim

2.10.1 The Non-Lapsable Central Pool of Resources (NLCPR) Scheme of the Ministry aims to fill up gaps in the infrastructure sector of the North Eastern Region through providing financial assistance to the projects prioritised by the North East State Governments. The Ministry gets an annual budgetary allocation for funding projects under the NLCPR Scheme. Funding of projects under NLCPR scheme is on 90:10 sharing pattern between Central and State Governments.

2.10.2 The following table shows allocation under Revenue and Capital Heads in BE 2018-19 for Central Pool of Resources for North East and Sikkim against actual expenditure during 2016-17 and BE & RE 2017-18:-

(Rs. in crore) Heads of Actual BE RE BE Accounts 2016-17 2017-18 2017-18 2018-19 Revenue 645.00 695.00 699.06 690.00 Capital 190.00 369.00 175.00 310.00 Total 835.00 1064.50 874.06 1000.00

2.10.3 As shown in the above table, total funds utilised by the NES for various projects under NLCPR (State) is Rs. 645.00 crore during financial year 2016-17. The total allocated funds of Rs. 645.00 crore have been released to States against various projects under NLCPR (State) Scheme. During the financial year 2017-18, an expenditure of Rs.619.00 crore has been incurred by the Ministry up to 31.01.2018.

2.10.4 Details of expenditure incurred under this head under the NLCPR-Central scheme during 2016-17 and 2017-18 (31.01.2018) are as under:-

Financial Year Total expenditure 2016-17 Rs. 190 crore 2017-18 Rs. 57.63 crore (In addition an amount of Rs. 102.89 crore is in process of being released)

2.10.5 The Committee enquired about the reasons for the reduction in the allocation under the capital head from Rs. 369.00 crore allocated in BE 2017-18 to Rs. 175.00 in RE 2017-18. The Ministry replied that the Ministry of Railways could use only Rs. 57.63 crore on the Akhaura- Agartala Rail link project though the planned expenditure for the Ministry of Railways during the financial year 2017-18 was Rs. 260.00 crore as approved by the Central Monitoring Committee (CMC). The Ministry of Railways has informed that progress has been adversely affected, inter alia, due to the following main reasons:

(i) Delay in handing over of land; (ii) Exceptionally high rainfall this year; and (iii) Delay in shifting of Electrical utilities by State Government.

2.10.6 The Indian Railway Construction International Limited (IRCON) has also taken cognizance of the relatively slow progress of the work in the said link project and accordingly the efforts are being augmented to complete the project by December, 2019, against the scheduled date of completion on 9 th April, 2020. However, this will not result into any cost overrun of the project.

2.10.7 When the Committee sought to know about the criteria for deciding the quantum of grants given to the States from the Central Pool of resources and the steps that have been taken to assist State Governments of NER for preparing sound and feasible Detailed Project Reports (DPRs), the Ministry informed the Committee that against the budgetary allocation, funds are distributed among States based on well defined criteria which are derived on the basis of certain parameters e.g., area, population, human development index, road density, census data, etc. To improve the quality of DPRs, the State Governments were advised to engage specialised institutions like IIT, Guwahati and other NITs in the region for preparation of DPRs. Further, the Ministry of DoNER has requested all NE States to nominate their personnel involved in projects formulations for undergoing training to enhance technical capacity at specialized training centres. The expenditure incurred on such training/ capacity development programmes will be borne by the Ministry.

2.10.8 The Committee expresses its concern over the reduction in allocation under the capital head to Rs. 175.00 crore at RE stage in 2017-18 against Rs. 369.00 crore allocated in BE 2017-18. Though the actual expenditure was Rs. 190.00 crore in 2016-17. The Committee takes note of the plea that the Ministry of Railways could absorb the fund to the tune of Rs. 57.63 crore only against the allocation of Rs. 260.00 crore on Akhaura- Agartala Rail link project as approved by the Central Monitoring Committee (CMC) in BE 2017-18 on account of delay in handing over land, exceptionally high rain fall during the year and delay in shifting of electrical utilities by the State Government. However, the Committee has been assured that the Akhaura-Agartala Rail Link project would be completed without time and cost overruns. The Committee hopes that the project would receive the highest priority and be completed without time and cost overruns.

2.11 North East Special Infrastructure Development Scheme (NESIDS)

2.11.1 The NESIDS which has been approved by the Cabinet on the 15 th December, 2017 is to fill gaps in the creation of infrastructure in two sectors: (i) Physical infrastructure relating to water supply, power, connectivity and specially the projects promoting tourism; and (ii) Social sectors of education and health. Under the scheme, projects will be taken up on the basis of 100 per cent central funding. The outputs/deliverables against the outlay of Rs.130.00 crore in 2018- 19 for the following projects would lead to an improvement in tourism facilities, increase in educational infrastructure and better health facilities:-

(i) Projects relating to tourism promotion; (ii) Infrastructure of primary & secondary education; and (iii) Infrastructure of primary & secondary health sector.

2.11.2 The following table indicates allocation of Rs. 180.00 crore in BE 2018-19 on three schemes:-

(Rs. in crore) Name of Schemes BE (2018-19) Revenue Capital NESIDS Programme 130.00 - Advocacy & Publicity and Capacity 20.00 - Enhancement for Governance in NER Hill Area Development Programme 30.00 - Total NESIDS 180.00

2.11.3 The provision under Advocacy & Publicity is for providing financial assistance for promotion and advocacy of inherent strengths of North Eastern Region and for dissemination of information about Government Schemes and relevant technologies. The provision under the Capacity Enhancement for Governance in NER is to fund training and capacity building of in- service personnel and Government functionaries of North Eastern States. The outputs/ deliverables against the outlay of Rs. 20.00 crore in 2018-19 consists of two components which inter alia include (a) Advocacy and Publicity: showcasing of NER by active publicity and providing platform through events organised, financial assistance to disseminate knowledge/ attract investors in NER and (b) Capacity enhancement for governance in NER–training the government officials/personnel.

2.11.4 The projects undertaken would lead to the following projected medium term outcomes:-

(i) Increase in purchase of products from NER; increase in arrival of tourists in NER; increase in investments in the NER; and (ii) better performance of the trained officials in the particular sector in which trained.

2.11.5 The provision under Hill Area Development Programme is for development of the backward district of Tamenglong in Manipur on a pilot basis for enhancement of physical and social infrastructure. The outputs/ deliverables against the outlay of Rs. 30.00 crore in 2018-19 for the following projects would lead to an improvement in the healthcare outcomes, enhancement of physical and social infrastructure, enhancing livelihoods and opportunities:

(i) Construction of civil enclaves/staff quarters for teachers and doctors; (ii) Physical infrastructure/construction of roads and bridges; and (iii) Infrastructure creation and promotion of eco-tourism.

2.11.6 During the Committee's meeting held on 16 th February, 2018, the Committee was given to understand that the NLCPR Scheme would be wound up in two years and all the projects thereunder would be completed by 2020. All schemes have a closing period of March, 2020. The Secretary, DoNER explained to the Committee that for ongoing schemes, the allocated amount would be reimbursed and no new schemes would be undertaken under NLCPR Schemes and new schemes would be taken up under NESIDS.

2.11.7 Justifying the rationale for the launching of NESIDS, the JS&FA, M/o DoNER explained to the Committee that:-

"Under the NLCPR, schemes are coming from various States relating to all sectors. And, there was no binding that schemes should come only from such and such sectors. So, due to this, we were getting very small projects of Rs.2 crores or Rs.50 lakhs. So, every effort of the Ministry of DoNER to have visibility and impact of the project got frittered away. For that reason, this new scheme was envisaged, so that the envelop size of the project is larger and there is a visible impact in that area."

2.11.8 The Secretary, M/o DoNER, giving further details about NESIDS said:-

"The scheme has changed from block grant which entails 90:10 ratio of money to 100 per cent totally funded by the Government of India. Under the block grant scheme, 10 per cent has to be given by the State Government concerned. Therefore, the States used to give priority list and within that priority we have to take up project. For example, if you go to Manas National Park, from the main

highway to Manas, 20 km. road is very bad. The Ministry of Tourism, under the Swadesh Darshan, looked at the road in Manas. But, they do not have a scheme to take it up. Earlier also, the State might not recommended that road; they have not done it so far. So, what we are hoping now is, we can push that scheme and get road under NESIDS Scheme. This is where we are adding to the already growing efforts. In all our Committees, the representatives from the concerned Ministries are always there, so that there would not be duplication. They only advise us to take up this and that."

2.11.9 The JS&FA, DoNER apprised the Committee about the change in guidelines, benefits arising thereof, under the new scheme which is as under:

"What has been done by the Ministry is the scheme guidelines have been revised drastically. Under those guidelines, we found that a lot of time is taking place just to vet projects. The project used to come from the State. Thereafter, it used to go to the Line Ministry. The Line Ministry used to take not less than 4-5 months to vet that project. So, a new institution has been created at the State level. It is called SLEC headed by the Chief Secretary. Now, it is the responsibility of SLEC to vet the project. So, what we observed after the SLEC is that the time has been drastically reduced. Earlier, the average time was to be around 4-5 months. Now, within a month or within one-and-a-half months it is completed. This the first change. The second change ... the concept of 'just in- time release.' So, as soon as the project was sanctioned, 40 per cent used to be released immediately. Now, it is not released; only Rs.10 lakh is given at the time of sanction. And, after the tender and work order is issued, 40 per cent is released. So, the concept of having new projects again and again has gone down. Moreover, for 2014-15, 2015-16, we did not take up any new projects. So, whatever allocation was made, almost 90 per cent was released for completion of the on-going projects. The result is, there has been a drastic jump in the number of projects completed. Earlier, the average number of projects completed used to be 10-11. Now, last year, the number of projects completed was 76 and till 31 st December, the number of projects completed, as reported by the States, is 45. So, by 31 st March, this number is also likely to go up. Similarly, pending utilization of money was very high. Now, it has come down to Rs.146 crore. So, with these changes, ... there has been a significant enhancement in the efficiency of implementation of the scheme."

2.11.10 The Committee takes note of the revision in the NLCPR Guidelines, measures initiated to ensure speedy implementation viz. , just-in-time release of funds by which an initial token amount of Rs. 10.00 lakh is released for tendering of works and balance amount of first installment is released only after receipt of letter of award of the contract; number of installments reduced to two as against the earlier practice of three installments; maximum expenditure of outlay against ongoing projects; online submission of requisite documents, which shortened processing period; regular review meetings and campaigning in the States to expedite timely completion of projects. The Committee appreciates the measures taken by the Ministry of DoNER and recommends that all projects undertaken under NLCPR and projects undertaken by the NEC should be completed within the stipulated time frame.

2.11.11 The Committee has been given to understand that the NESIDS is a Central Sector Scheme with financial outlay of Rs. 1600.00 crore for a period of three years commencing from 2017-18 where no allocation has been made for the first year i.e. 2017-18 and for the second financial year i.e. 2018-19, a sum of Rs. 180.00 crore has been earmarked, leaving a 19 huge amount of Rs. 1420.00 crore for the third year i.e. 2019-20. The Committee is seriously doubtful as how the scheme, being approved on 15 th December, 2017 with total approved cost of Rs. 1600.00 crore to be implemented during a period of three years with no allocation made for the first year of scheme i.e. 2017-18 and for the second financial year i.e. 2018-19, a total allocation made is to the tune of Rs. 180.00 crore only and thus leaving a huge amount of Rs. 1420.00 crore for the last year of scheme i.e. 2019-20. The Committee, keeping in mind the work and efficiency of implementing agencies of schemes under prevailing geographical scenario and climatic conditions in NER and also the absorption-capacity, has serious apprehensions that the amount left for third year of scheme would be optimally utilised during the year 2019-20. Therefore, the whole purpose of the scheme may lose its momentum, pushing the scheme to suffer from improper planning and imprudent expenditure. The Committee, therefore, calls upon the Government to relook the fund allocation under the scheme during the RE 2018-19 and ensure that the projects undertaken under NESIDS are not derailed.

2.12 Consultancy, Monitoring, Evaluation

2.12.1 The following table shows revenue allocation in BE 2018-19 for Consultancy, Monitoring and Evaluation against the actual expenditure during 2016-17 and allocation made in BE & RE 2017-18:-

(Rs. in crore) Actual BE RE BE 2016-17 2017-18 2017-18 2018-19 Revenue 2.29 5.00 2.00 2.00

Capital ------Total 2.29 5.00 2.00 2.00

2.12.2 When the Committee enquired about the reasons for reduction in the outlay under this head from Rs. 5.00 crore in BE 2017-18 to Rs. 2.00 crore in RE 2017-18 and BE 2018-19, the Ministry replied that the provision was mainly for payment towards vetting of DPRs through Public Sector Undertakings. Under the revised guidelines, this activity has been delegated to State Governments. Therefore, outlay has been reduced to Rs. 2.00 crore at RE stage.

2.12.3 The Committee notes that under revised NLCPR guidelines the work of vetting of DPR of projects has been delegated to State Governments, therefore, the revenue outlay under Consultancy, Monitoring, Evaluation - charges under NLCPR scheme has been reduced from Rs. 5.00 crore in BE 2017-18 to Rs. 2.00 crore in RE 2017-18 and BE 2018- 19, as the provision was mainly for payment towards vetting of Detailed Project Reports through Public Sector Undertakings. The Committee hopes that the revised NLCPR guidelines would work successfully and sincere efforts would be made in this direction to ensure the efficiency of the new guidelines.

2.13 Capacity Building and Publicity

2.13.1 The following table brings out the allocation made in BE & RE 2017-18 for Capacity Building and Publicity against the actual expenditure during 2016-17:-

(Rs. in crore) Actual BE RE BE 2016-17 2017-18 2017-18 2018-19 Revenue 59.23 52.00 52.00 -- Capital ------Total 59.23 52.00 52.0 -- 0 2.13.2 The provision is for providing technical assistance for training of State Government functionaries of North Eastern States in the interest of good governance. The provision under Advocacy & Publicity Scheme is for providing financial assistance to the NGOs and Government agencies for organising business summit, trade expositions, seminars, Media campaign, etc. which are meant for promotional activities involving the North Eastern Region.

2.14 NER Livelihood (EAP) Project (NERLP)

2.14.1 The basic objective of the World Bank aided North East Rural Livelihood Project (NERLP) is “to improve rural livelihood, especially that of women, unemployed youth and the most disadvantaged in the project area covering 11 districts of four North Eastern States of Mizoram, Nagaland, Sikkim and Tripura”. These areas mainly cover Aizawl and Lunglei districts of Mizoram, Peren & Tuensang districts of Nagaland, South Sikkim & West Sikkim districts of Sikkim and West Tripura, Sepahijala, Khowai, Unakoti and North Tripura districts of Tripura.

2.14.2 The following table depicts the allocation for NERLP under Revenue head in BE 2018- 19 against the actual expenditure during 2016-17 and allocation made in BE & RE 2017-18:-

(Rs. in crore)

Actual BE RE BE 2016-17 2017-18 2017-18 2018-19 Revenue 173.95 150.00 215.00 180.00 Capital ------Total 173.95 150.00 215.00 180.00

2.14.3 The Committee sought to know the reason for increasing the allocation of Rs. 150.00 crore in BE 2017-18 to Rs. 215.00 crore in RE 2017-18 and the actual expenditure till 31 st January, 2018. In its response, the Ministry submitted that the estimated expenditure for 2017- 18 was worked out at Rs. 250.00 crore including the available fund with the project of Rs. 35.00 crore. As against the estimated expenditure of Rs. 250.00 crore, the BE 2017-18 was earmarked at Rs. 150.00 crore. Thus, the remaining amount of Rs. 65.00 crore has been provided at supplementary stage increasing the RE 2017-18 to Rs. 215.00 crore. The actual expenditure incurred till 12 th January, 2018 was Rs. 140.00 crore. Increased allocation of Rs. 215.00 crore at RE 2017-18 will take care of the fund requirement for the activities planned for the year.

2.14.4 The Ministry maintained that the projected expenditure of NERLP for 2018-19 was worked out at Rs. 180.00 crore taking into consideration the closing date of the project which is March 2019. With the allocation of Rs. 180.00 crore in BE 2018-19, NERLP will meet the entire project cost.

2.14.5 The Ministry further informed the Committee that apart from the livelihood activities being undertaken by the SHG members by availing of group loans and bank credit, the

21 interventions in terms of livelihood clusters and value chain development, demonstration of successful livelihood models and community-based business development through the promotion of Producer Groups (PGs) and Producer Organizations (POs), have proved very effective in improving rural livelihoods.

2.14.6 Another important intervention of NERLP has been CDPs-land reclamation, diversion- based irrigation, plantation of fodder, plantation of nurseries and other plantation, collection centres, market sheds, conservation of forest in water source and catchment areas etc. focusing mainly on sustainable management of natural resources and livelihoods which created great livelihood opportunities for the rural people. The collectivisation of farmers into PGs and POs which are under expeditious progress will also help the farmer/ producers to realise more remunerative prices of their products through facilitation of aggregation, value addition and effective marketing. The NERLP is also sponsoring unemployed youths for skill trainings and so far, more than 6000 youths are placed with jobs from project Districts.

2.14.7 When the Committee desired to know about the steps that are being taken/can be further taken to implement the projects under NERLP more effectively, the Ministry stated that the promotion of PG and POs is being taken up with priority. This will help the farmers to aggregate their products for remunerative marketing and for processing and value addition. NERLP is facilitating a few PGs/POs for setting up processing units on different products. Apart from connecting the farmers with domestic markets, the NERLP is also promoting a pool of local youth for exploring export markets. Another priority of NERLP is to link the SHGs with banks for expanding institutional credits and greater financial viability of these Groups.

2.14.8 The Committee feels that the major impediment in the implementation of NERLP is the absence of institutionalised credit to SHGs. The Committee, therefore, strongly recommends that steps be taken for improving the bank linkage of the SHGs. Concerted efforts such as signing of MOUs with banks, provision of Bank Mitras and appointment of Banking Correspondents for serving in the areas not covered by banking services must be made. The Committee hopes that the projects undertaken under the NERLP would prove effective in increasing employment opportunities, improving rural livelihoods, etc. in selected identified districts of Mizoram, Nagaland, Sikkim and Tripura.

2.15 North East Road Projects

2.15.1 The following table shows the revenue allocation in BE 2018-19 for NER projects against actual expenditure in BE 2016-17 and allocation made in BE & RE 2017-18:-

(Rs. in crore) Heads of Actual BE RE BE Accounts 2016-17 2017-18 2017-18 2018-19 Revenue 167.00 2.00 0.66 1.00 Capital ------Total 167.00 2.00 0.66 1.00

2.15.2 A provision of Rs. 1.00 crore has been earmarked for the year 2018-19 for meeting the expenditure in the Ministry of DoNER which would facilitate the implementation of the ADB assisted road projects in the NER. Responding to the Committee's query, the Ministry stated that the earmarked allocation would be sufficient for the intended purpose.

2.15.3 The Committee wanted to know as to when the last survey was done for identifying roads of economic importance and about the monitoring process for tracking improvement of

22 such roads. The Ministry stated that under NESRIP, a survey was done in the year 2008 for identifying roads of economic importance. The Project Management Consultancy (PMC) was engaged for monitoring processes for tracking improvements in the projects which are being inspected by both ADB team and Ministry of DoNER at regular intervals to clear bottlenecks and speed up the progress of the project.

2.15.4 The Committee was given to understand that the roads of economic importance are also identified by the Border Roads Organisation (BRO). As per information received, four new roads have been identified for possible funding which inter alia includes:

(i) Construction of realignment of Balipara-Charduar-Tawang road from 229 Km. to 247.60 Km. to include two tunnels of length 2.265 Km. with approach roads of length 10.07 Km. (ii) Upgradation of road Along-Kaying-Tato-Menchuka to NHDL specification (80.00 Km.) in Arunachal Pradesh. (iii) Development of the 82 Km. stretch Sairang (Buichali)-Tuibuibari (Rajiv Nagar) road to NHDL specification in Mizoram. (iv) Development of the 47 Km. long Kawanpui-Durtlang-Aizawl road to NHDL specifications in Mizoram.

2.15.5 The BRO submits the UC and physical progress from time to time to the NEC as part of the monitoring process.

2.16 Construction/Improvement of Roads of Economic Importance

2.16.1 The following table highlights the allocation under Capital head for construction/ improvement of roads of economic importance in BE 2018-19 against actual expenditure during 2016-17 and allocation made in BE & RE 2017-18:-

(Rs. in crore) Heads of Actual BE RE BE Accounts 2016-17 2017-18 2017-18 2018-19 Revenue ------Capital 4.95 5.00 5.00 40.00 Total 4.95 5.00 5.00 40.00

2.16.2 Under the head Construction/ Improvement of Roads of Economic Importance, the allocation of Rs. 5.00 crore in BE 2017-18 has been enhanced significantly to Rs. 40.00 crore in BE 2018-19. Explaining the reasons for this increased allocation, the Ministry stated that the total length of Mahadev-Tolloi road is 78.00 kms. The re-carpeting of the existing road for 44.25 kms was sanctioned for Rs. 12.83 crore on January, 2017. The balance portion of 33.75 kms is to be taken up during 2018-19. In addition, new roads are also proposed to be taken up under roads of economic importance by the BRO through the NEC. As such, Rs. 40.00 crore has been kept as outlay during 2018-19 including the committed liability.

2.17 North East Road Sector Development Scheme (Programme Component)

2.17.1 North East Road Sector Development Scheme (NERSDS) was basically meant for strategically important inter-state roads, which were not properly maintained by either of the States due to various reasons. Initially, the meeting was held by the Empowered Inter- Ministerial Committee for NERSDS under the Chairmanship of the Secretary, DoNER and

subsequently under the Chairmanship of the Secretary, NEC on November, 2016. Initially, three projects were being implemented, namely:-

(i) Harmuti-Doimukh road 17.47 kms –Rs.58.26 crore (ii) Wokha-Merapani road 60.00 kms –Rs.151.01 crore (iii) Tura-Mankachar road 1.66 kms –Rs.4.71 crore.

2.17.2 These projects are being implemented by the NHIDCL.

(Rs. in crore) Heads of Actual BE RE BE Accounts 2016-17 2017-18 2017-18 2018-19 Revenue ------Capital 150.00 150.00 150.00 250.00 Total 150.00 150.00 150.00 250.00

2.17.3 Under the North East Road Sector Development Scheme, the allocation of Rs. 150.00 crore in BE 2017-18 has been enhanced to Rs. 250.00 crore in BE 2018-19. The Ministry explained that during 2017-18, Rs. 150.00 crore was the projected demand for three projects. The three projects being implemented by the NHIDCL are in progress and these projects are targeted to be completed by September, 2018.

2.17.4 The Committee has been informed that 17 projects are proposed to be taken during 2018- 19. Hence, the enhancement of outlay has been made during 2018-19. The DPR for 15 more roads and two bridges is under process. The details of the roads are as under:-

A - Inter-state roads & bridges Sl. Name of the Road District NEC Length of the Road (KM) Neighb- DPR to be No funded Length of Length of the Total ouring prepared roads the Road in Road in state by the neighbouring concerned state State(km) (km) 1 2 3 4 5 6 7 ARUNACHAL PRADESH 1 Mebo-Dolla Road East Siang No 30 20 50 Assam BBJ 2 LongdingBimlapur Changlang Yes 35 0 35 Assam CPWD Road TOTAL 65 20 85 MEGHALAYA 1 Lakhipur to West Garo No 0 15 15 Assam CPWD Abirampara Hills connecting AMPT road at 19th km 2 MukrohUmspar West No 8 4 12 Assam CPWD linking Jrikyndeng Jaintia road Hills 3 9th Mile (on EW BBJ Corridor in Assam) Ribhoi No 34 3 37 Assam to Umsen via Killing Palangkata) Rymbai-Bataw- CPWD East 4 Borsora-Jalalpur Yes 3 0.00 3.00 Assam Jaintia Road TOTAL 45 22 67

NAGALAND 1 Tenning to Peren No 50 0 50 Assam BBJ (Nagaland) to Lekie Road (Assam) 2 Upgradation of road Mokukch- No 17 0 17 Assam BBJ from Dikhu Bridge ung to Amguri Assam 3 Upgradation of AT Mokukch- No 25 0 25 Assam BBJ Road from ung Tsurangra to Impur Junction TOTAL 92 0 92 MANIPUR Jalengbung to CPWD UKL and 1 Kezakheno via Partly 20 0 20 Senapati Sinakeithel road HenglepThingkheiu CPWD 2 CCPR Yes 15 0 15 Mizoram Tipaimukh Road TOTAL 35 35

TRIPURA HmanpuiDamcherra CPWD 1 Dholai No 15 15 30 Mizoram Road TOTAL 15 15 30

A GRAND TOTAL 252 57 309

B - Roads leading to international borders Length of Bordering DPR to be prepared State road (kms) country by Manipur 1 Kamjong to Kongkan Thana 40 Myanmar BBJ Nagaland 1 Lozaphuhu to Avankhung LCS 50 Myanmar CPWD 2 Tuensang to Longleng 50 Myanmar BBJ Sikkim Two bridges in South and West Sikkim (120 BBJ 1 kms) Nepal

Total 140 Grand Total (A+B): 15 Roads+2 bridges of Sikkim : 449.00 kms+120RM bridges DPR to be prepared by BBJ : 7 Roads and Bridges of Sikkim DPR to be prepared by CPWD : 8 Roads

2.18 North East Road Sector Development Scheme (EAP Component) (Rs. in crore) Actual BE RE BE 2016-17 2017-18 2017-18 2018-19 Revenue 150.00 150.00 180.00 333.27 Capital ------Total 150.00 150.00 180.00 333.27

2.18.1 Under EAP component, revenue expenditure to the tune of Rs. 150.00 crore was incurred during 2016-17. Both tranches of NESRIP were undertaken and it is understood that physical targets will be achieved within the stipulated time frame. Details of time schedule and estimated cost in the tabular form are given below:- 25

NESRIP Time Estimated Cost

Tranche-I June, 2019 Rs. 497.13 crore

Tranche-II March, 2020 Rs. 856.70 crore

2.18.2 Explaining the reasons for a significantly higher allocation of Rs. 333.27 crore in BE 2018-19 under EAP component as compared to Rs. 150.00 crore in BE 2017-18 the Ministry maintained that the project has picked up momentum and the progress has improved. Keeping in view the loan closure date in June, 2019 for Tranche-I and March, 2020 for Tranche-II respectively sufficient funds are required to complete the project within the stipulated time period. Hence, higher allocation has been given for FY 2018-19. Against the amount of Rs. 150.00 crore under this head, an expenditure of Rs. 134.68 crore as on 31 st January, 2018 and Rs. 150.00 crore as on 6 th February, 2018 has been incurred. Responding to the query of the Committee, the Ministry assured the Committee that the earmarked amount to the tune of Rs. 333.27 crore would be spent during 2018-19.

2.18.3 As regards the existing monitoring mechanism to ensure the implementation of projects under North East Road Sector Development Scheme (NERSDS), the Ministry stated that an Inter-ministerial Committee under the Chairmanship of the Secretary, NEC has been constituted with FA, NEC as Member and the Adviser (T&C) as the Member Secretary. The other members of the Committee are from the Ministry of Road Transport and Highways, the Ministry of Home Affairs and the Ministry of Finance. This Committee will be responsible for screening, appraising, approving and monitoring the project proposals.

2.18.4 The Committee observes that under the North East Road Sector Development Scheme (NERSDS), there are two components viz. Programme Components and EAP. The Programme components contain three road projects being implemented by the NHIDCL that is to be completed by September, 2018. Besides, 15 more road projects and two bridge projects are at preparation of DPR stage. While under EAP, there are two phases i.e. Tranche-I and Tranche-II under NESRIP that have been undertaken with estimated cost of Rs. 497.13 crore and are to be completed by June, 2019 and at the estimated cost of Rs. 856.70 crore to be completed by March, 2020, respectively. The Committee, keeping in view the closure of all projects by March, 2020, strongly recommends that every effort must be made to execute the projects undertaken without any time and cost overruns.

2.18.5 The Committee is constrained to express its deep displeasure that under the programme component of the North East Road Sector Development Scheme, no fund has been utilised because all the projects are pending at the stage of preparation of DPR. The Committee finds that the procedural delay in approval of the projects arises due to the requirement of third party evaluation and also because the Ministry held the EFC meeting as late as i.e. in the month of December, 2017. The Committee was given to understand that the funds can be allocated and utilised only after the approval of the projects. The Ministry assumed that the funds would be utilised by transferring the amount to the implementing agencies viz. CPWD and BBJ during 2017-18 and 2018-19. The Committee finds the implementation of the programme will be unsatisfactory unless the projects are approved on time. The Committee finds it difficult to understand that the Ministry expects to implement the Programme Component merely by transferring the funds when the projects have not been even granted approval by the Ministry. The Committee, therefore, strongly recommends that the preparation of DPR of seven roads and two bridges in Sikkim by the BBJ and preparation of DPR of eight roads by the CPWD must be expedited so that all the projects under the programme component of the NERSDS are

26 approved in time, funds are allocated/released and all the projects are implemented within a specified timeframe without any cost overrun.

2.19 Bodoland Territorial Council (BTC)

2.19.1 As per the Memorandum of Settlement (MoS), the Government of India agreed to provide a Special Economic Package over and above the Plan fund to the Bodoland Territorial Council (BTC) through the Government of Assam to undertake special projects for socio- economic infrastructure development that will be proposed by the Council. The total value of the package is Rs. 750.00 crore. During 2017-18 funds towards subsequent installments were released for the ongoing projects of various infrastructure sectors like road and bridges, power, agriculture, veterinary, art and culture etc.

2.19.2 The following table reflects the revenue allocation in BE 2018-19 to BTC under Special Development Packages against the actual expenditure during 2016-17 and allocation made in BE & RE 2017-18:-

(Rs. in crore) Heads of Actual BE RE BE Accounts 2016-17 2017-18 2017-18 2018-19 Revenue 50.00 50.00 50.00 20.00 Capital ------Total 50.00 50.00 50.00 20.00

2.19.3 Explaining about the reason for reduction of allocation from Rs. 50.00 crore in RE 2017- 18 to Rs. 20.00 crore in BE 2018-19, the Ministry stated that out of the total package of Rs. 750.00 crore, funds to the tune of Rs. 709.84 crore has already been released. The balance amount available under the Budget of 2017-18 is sufficient to meet the requirements likely to be raised by March, 2018. As such an amount of Rs. 20.00 crore was projected for the year 2018-19 to fund the balance requirement of subsequent installments against the remaining projects during the next year.

2.19.4 On being asked about the problems that are being faced by the Council in undertaking developmental activities in the BTC area and what steps are being taken to combat the same, the Committee was apprised that there were some cases of delay in transfer of funds from the State Government in the past which has since been addressed.

2.19.5 Responding to the Committee's query about the further steps that can be taken for making Bodoland Territorial Council a harbinger of socio-economic development, the Ministry stated that the State Government may take up other schemes in the area for its socio-economic development.

2.19.6 The Committee understands that the efficient working of BTC would lead to socio- economic infrastructure development like road & bridges, power, agriculture, art and culture. The Committee takes note of the submission of the Secretary, DoNER that there is no money left in BTC package. The Committee finds the performance of the BTC satisfactory.

2.20 Karbi Anglong Autonomous Territorial Council (KAATC)

2.20.1 As per the Memorandum of Settlement (MoS), the Government of India agreed to provide a Special Economic Package of Rs. 350.00 crore (Rs. 70.00 crore per annum) over and above Plan fund for five years to Karbi Anglong Autonomous Territorial Council (KAATC) through Government of Assam to undertake special projects for socio-economic infrastructure development that will be proposed by the Council through Government of Assam. Funds were meant to be utilised by the Council for the projects of various sectors like road, community centre, veterinary, water supply, art and culture, etc.

2.20.2 The following table reflects the revenue allocation in BE 2018-19 to KAATC against the actual expenditure during 2016-17 and allocation made in BE & RE 2017-18:-

(Rs. in crore) Heads of Actual BE RE BE Accounts 2016-17 2017-18 2017-18 2018-19 Revenue 3.44 40.00 40.00 40.00 Capital ------Total 3.44 40.00 40.00 40.00

2.20.3 When the Committee sought to know whether all the projects undertaken during the year were completed within the stipulated period and how the Ministry intends to utilise the amount of Rs. 40.00 crore allocated in BE 2018-19 under this head, the Ministry replied that the agreed period for completion of the projects are normally two to three years. However, their completion gets affected due to procedural delays. The amount of Rs. 40.00 crore allocated in BE 2018-19 will be utilised against ongoing and retained projects.

2.20.4 The Committee was informed that against the actual expenditure of Rs. 3.44 crore in 2016-17, Rs. 40.00 crore was earmarked during BE 2017-18 and the projected demand under KAATC is Rs 40.00 crore for the year 2018-19. However, the Secretary, Ministry of DoNER in response to a query raised by the Committee, pointed out that under KAATC package money goes from the Hill Area Department to the Planning Department to the Council. In some projects there are problems of delay in preparation of DPR as the procedure becomes very cumbersome. Therefore, the Ministry is making efforts for fast-tracking implementation of the project.

2.20.5 The Committee observes that Karbi Anglong Autonomous Territorial Council (KAATC) is not able to absorb the allocated fund. The Committee expresses its concern that though Karbi Anglong had an allocation of Rs. 40.00 crore in BE 2017-18 and the Rs. 40.00 crore has been retained at RE stage, the Secretary submitted before the Committee that KAATC could spend only Rs. 1.5 crore in the financial year 2017-18. The actual expenditure in 2016-17 was Rs. 3.44 crore against allocation of Rs. 30.00 crore in BE 2016- 17. The Committee, therefore, recommends that the Ministry of DoNER in association with the State Government of Assam must remove the procedural delays in preparation of DPRs and expedite approval of the projects so that these could not only be undertaken for implementation but are also completed without further delay.

2.21 Dima Hasao Autonomous Territorial Council (DHATC)

2.21.1 As per the Memorandum of Settlement (MoS) in October 2012, the Government of India agreed to provide a Special Economic Package of Rs. 200.00 crore (Rs. 40.00 crore per annum) over and above Plan fund for five years to Dima Hasao Autonomous Territorial Council (DHATC) through Government of Assam to undertake special projects for socio-economic

28 infrastructure development that will be proposed by the Council through the Government of Assam.

2.21.2 The following table reflects the allocation made in BE 2018-19 to DHATC, actual expenditure during 2016-17 and allocation made in BE & RE 2017-18:-

(Rs. in crore) Heads of Actual BE RE BE Accounts 2016-17 2017-18 2017-18 2018-19 Revenue 0.08 30.00 30.00 20.00 Capital ------Total 0.08 30.00 30.00 20.00

2.21.3 An amount to the tune of Rs. 30.00 crore was earmarked in BE 2017-18 under this head. However, in BE 2018-19 it has been reduced to Rs. 20.00 crore. The Ministry stated that since most of the projects have been sanctioned during the current financial year, the likely requirement of funds during 2018-19 would be less. The projected demand for the year 2018-19 was Rs. 33.00 crore. The total capital expenditure as on 31 st January, 2017 was nil. However, the expenditure till January, 2018 was Rs. 23.37 crore. Balance funds available during the current year and the allocation earmarked for next financial year i.e. 2018-19 are likely to take care of the demands under the packages.

2.21.4 Responding to the Committee's query about the problems that are being faced by the Council in undertaking developmental activities in the Dima Hasao Territorial Council area and the steps taken and proposed to be taken to tackle the same, the Ministry stated that the completion of projects gets affected by procedural delays.

2.21.5 As regards the further steps that can be taken for strengthening the functioning of the Dima Hasao Territorial Council as an agency for socio-economic development, the Ministry maintained that the State Government may encourage more participation of the Council in planning and execution of schemes in the area.

2.21.6 The Committee is dismayed with the working of the Dima Hasao Territorial Council as the Council is not able to absorb the allocated fund for developmental activities. As per the provision of memorandum of settlement, the Government of India agreed to provide a special package of Rs. 200.00 crore (Rs. 40.00 crore per annum) over and above the Plan fund, but Dima Hasao Council could spend Rs. 23.37 only against the allocation of Rs. 40.00 crore. The Secretary, Ministry of DoNER submitted before the Committee that the allocated funds are available to the Council but the Council is not able to spend the allocated fund on the developmental activities. The Committee, therefore, strongly recommends that M/o DoNER must take a lead in coordinating with the State Government of Assam for formulating infrastructure projects so that all proposals of DHATC are submitted in time for final approval. The Committee further recommends that the Ministry must have appropriate monitoring mechanism in place to ensure speedy execution of projects undertaken without any time and cost overrun.

2.21.7 During the course of discussion on Demands for Grants, the Committee raised the query as to why the allocation to the three territorial councils have been sharply reduced from Rs. 120.00 crore to Rs. 80.00 crore in BE 2018-19. Responding to that, the Secretary, M/o DoNER explained that these packages were made after three tripartite negotiations.

2.21.8 The Secretary, M/o DoNER further explained the mechanism of the working of tripartite agreement as under:-

"This was an agreement between the Home Ministry, the State Government and the Council. It was a Tripartite Agreement. We assured the money from our side. The scheme was to be implemented by the Home Ministry and the State Government themselves. We found that there was a delay in selection of schemes, getting approvals and we have been giving money every year. This year, we have tried to finish the targets. Dima Hasao will be almost exhausted; Rs.80 crore is left under Dima Hasao because they have taken the first installment. Money will come only if they spend the second installment. In some projects, the DPR has not reached us. We had a meeting with the State Government. There also, the procedure is very cumbersome. From the Council, it goes to the Hill Department. They send it to some other Department. Then, it comes to us. There is a time-frame of four years."

2.21.9 The Committee raised the query that if Rs. 80.00 crore is left with Karbi Anglong and Rs. 70.00 crore is left with the Dima Hasao, how these two Councils would able to spend the same in 2018-19 and whether that is because the Ministry of Finance did not allocate money these two Councils asked for or these two Councils did not ask for money at all on the grounds of their low utilisation capacity. Responding to that, the Secretary, Ministry of DoNER stated that these councils could not absorb the allocated money. The schemes chosen also were not correct.

2.21.10 The Committee is constrained to express its deep displeasure over the dismal performance of Dima Hasao Territorial Council (DHTC) and Karbi Anglong Autonomous Territorial Council (KAATC) due to low absorption capacity of these autonomous territorial councils. The Committee finds that there are serious procedural lacunae in the functioning mechanism of both the Councils, which were created to give autonomy to the tribals for their upliftment, but unfortunately, the councils are not able to absorb the allocated amount on development activities. The Committee fails to understand the reason. When Bodoland Territorial Council (BTC) can absorb all its allocated funds within the stipulated time, what holds up the other territorial councils to follow the footsteps of BTC? The Committee is of the opinion that there seems to be no mechanism in place to expedite the development process by preparing schemes, taking their approval and executing them in a time bound manner. The Committee, therefore, strongly recommends that there remains an urgent need to put in place a robust co-ordination mechanism to expedite the development process so that desired results could be achieved.

2.22 Social and Infrastructure Development Fund (SIDF)

2.22.1 The Ministry of DoNER apprised the Committee that a sum of Rs. 500.00 crore (subsequently enhanced to Rs. 586.20 crore) was set aside for taking up infrastructure projects in North Eastern Region especially from Arunachal Pradesh and other border areas facing typical problems that cannot be tackled through normal schemes. This is called Social and Infrastructure Development Fund (SIDF), which is a one-time package that covers projects which, inter alia , includes construction of new roads and bridges, re-establishment of new sub- stations/transmission lines; construction/ upgradation of hospitals, establishment of schools; and water supply projects.

2.22.2 A total of 37 projects have been approved/ identified against the fund available under SIDF and Rs. 459.40 crore have been released so far. Under the SIDF, the projects are prioritised by the State Governments as per their requirement. Since the SIDF is a one-time

30 package and all the projects have been retained against the total funds allocated in the package, no new project can be funded under the SIDF.

2.22.3 The following table depicts allocation of Capital outlay in BE 2018-19 for SIDF against the actual expenditure during 2016-17 and allocation made in BE & RE 2017-18:-

(Rs. in crore) Heads of Actual BE RE BE Accounts 2016-17 2017-18 2017-18 2018-19 Revenue ------Capital 47.70 110.00 55.00 60.00 Total 47.70 110.00 55.00 60.00

2.22.4 A capital outlay to the tune of Rs. 110.00 crore was earmarked in BE 2017-18 which was reduced to Rs. 55.00 crore at RE 2017-18. Responding to the Committee's query about the reasons for such a drastic reduction in allocation and the projects that got affected due to this reduction, the Ministry furnished the following explanation:-

(i) In the financial year 2016-17 the demands of Rs. 110.00 crore was made on presumption that the funds will be required for making first release i.e. 50 per cent of the retained cost of 14 projects worth Rs. 199.52 crore identified by the Public Accounts Committee (PAC) in its meeting dated 15 th December, 2016.

(ii) These 14 projects include projects with smaller envelope size received from Arunachal Pradesh in lieu of project, "Construction of 132 KV single circuit transmission line from Khuppi to Tawang" worth Rs. 119.88 Crore, which was taken over by the State Government with the Ministry of Power as its revised cost of Rs. 452.18 crore was much higher than the available funds in SIDF.

(iii) All the 14 projects which were retained by PAC accordingly the respective State Governments were requested to submit the project after getting them vetted by the respective State Level Executive Committee (SLEC).

(iv) Meanwhile, the proposals submitted by the State Governments against the scrapped project were referred back with request to submit bigger proposals having envelope size of more than Rs. 20.00 crore, in conformity with the recommendations of the Department-related Parliamentary Standing Committee.

(v) The State Government re-visited its proposals and re-submitted projects of higher estimated cost with envelope size of Rs. 15.00 crore and more and requested to sanction these projects considering their strategic locations and importance. This causes delay in starting of projects by the State Governments and consequently, non-submission of requisition for subsequent release.

(vi) As on date all the projects have been identified against the fund available under the SIDF and Rs. 459.40 crore have been released so far. The Utilisation Certificate due has been brought down to the less than 2% of the released amount

2.22.5 The projected demand for the year 2017-18 under the SIDF was Rs. 110.00 crore and allocation of the same amount was made, which was reduced to Rs. 55.00 crore at RE 2017- 18.The projected demand for the year 2018-19 under the SIDF was Rs. 60.00 crore and allocation of the same amount has been made. The Ministry maintained that there is no cost

31 overrun in the projects under the SIDF. However to avoid cost and time overrun for the projects under SIDF, the matter is being pursued with the State Governments, through visits and Video Conference.

2.22.6 The Committee was given to understand that a provision of Rs. 586.20 crore was made under the Social and Infrastructure Development Fund (SIDF) for undertaking infrastructure projects in the NER in Arunachal Pradesh and other border areas which could not be covered through normal schemes. The Committee hopes that all the projects under the scheme will be completed within the stipulated timeframe and estimated cost. The Committee also believes that the concerted efforts need to be made by the Ministry of DoNER to accelerate the utilisation of funds under the SIDF.

2.23 North East Development Finance Corporation (NEDFi)

2.23.1 NEDFi has been playing an important role in facilitating setting up of new industrial and service sector projects in the NE states. The annual budgetary allocation of fund received by NEDFi has been fully utilised for disbursement to MSME and micro finance projects as per the MoU signed between the Ministry of DoNER & NEDFi. The Corporation, from its internal generation, also undertakes several initiatives towards promotion and development of MSME & micro finance sectors in the region, in line with the terms and conditions stipulated in the MoU signed with the Ministry of DoNER.

2.23.2 In addition, the Corporation, through its CSR initiatives, undertakes capacity building programmes on various trades for providing alternative sustainable livelihood to the artisans; facilitate marketing support to artisans of the NER through exhibition participation; and also marketing their produce through various showrooms at Guwahati & Khetri of Assam, Imphal of Manipur, Aizwal of Mizoram, Namchi of Sikkim and Tawang of Arunachal Pradesh.

2.23.3 A summary of fund received and disbursed since 2014-15 is given below:-

(Rs. in crore) Financial Year Fund received Fund utilized 2014-15 60.00 65.36* 2015-16 30.00 60.83* 2016-17 30.00 61.76* 2017-18 30.00 35.93* (till February 13, 2018) (*The excess utilization of fund is generated from NEDFi’s own resources)

2.23.4 The following table shows allocation of capital outlay for NEDFi in BE 2018-19 for SIDF against the actual expenditure during 2016-17 and allocation made in BE & RE 2017-18:-

(Rs. in crore) Heads of Actual BE RE BE Accounts 2016-17 2017-18 2017-18 2018-19 Revenue ------Capital 75.00 30.00 30.00 30.00 Total 75.00 30.00 30.00 30.00

2.23.5 The loan products of the Corporation are structured mainly towards development of the Micro, Small and Medium Enterprises (MSME) segment which is a key driver of economic growth and capital formation in the NE Region. The Corporation takes the following initiatives for entrepreneurship development:-

(i) Setting up Business Facilitation Centres (BFC) in all NE states to guide new and first generation entrepreneurs (FGEs) in all areas related to project financing including preparation of DPR (ii) Providing mentoring assistance and credit linkages to entrepreneurs (iii) Conducting Seminars/Workshops/Business Meets/Awareness programmes for potential first generation entrepreneurs. These Seminars/Workshops also become a contact point for identifying the financing needs of the entrepreneurs. (iv) Capacity development programmes for NGOs/Micro Finance Institutions (MFIs) (v) The Corporation has prepared 100 project profiles related to MSME sectors which has been widely distributed and also uploaded in the website. (vi) Design & Skill Upgradation Programme: These programmes basically aim at improving the existing skill of the artisans and craftsmen by providing the design inputs so that value added products can be developed. It includes different streams like handloom, handicraft, artificial flower making, value added broom making, etc. (vii) Marketing Support: NEDFi provides assistance in marketing of the products of the artisans and entrepreneurs by facilitating them in participation at various exhibitions in different parts of the country as well as in the neighbouring countries. (viii) Exposure trip to entrepreneurs: The Corporation provides support for Exposure Visit of entrepreneurs/mentors of the region to specific technology/exhibition/ industry established in other States.

2.23.6 The Committee desired to know about the future strategies to improve performance of this Corporation and the support expected from the central government and in what ways NEDFi plans to expand the scope and coverage of its activities. The Ministry stated that the Corporation looks forward to make wider and deeper market penetration in the years ahead and reach out to the young generation in all NE states, with the objective of helping and encouraging entrepreneurs of the region and boost the pace of Corporation’s efforts in bringing about more inclusive and equitable growth in the region, by providing financial assistance at a concessional rate of interest, including undertaking various promotional and developmental activities.

2.23.7 The Corporation has given more thrust to certain areas for improving its performance in future which inter alia includes new products and services; emphasis on industries having potential to create more job opportunities; resource augmentation for financial inclusion; targeting first generation local entrepreneurs through business counselling and networking; skill development; business facilitator model; advisory and consultancy services.

2.23.8 The Committee appreciates the performance of the North East Development Finance Corporation (NEDFi) for promotion of MSME and micro finance sector which, no doubt, contribute towards more inclusive and equitable growth in the NER. The Committee, therefore, recommends that the annual allocation to NEDFi may be enhanced in order to boost the pace of Corporation’s efforts in mirco financing and promoting other developmental activities. The Committee reiterates its recommendation made in the 202 nd Report on Demands for Grants (2017-18) of the Ministry of DoNER that NEDFi must play the role of the key driver of equitable economic development and inclusive growth by boosting the pace of entrepreneurship development, setting up of Business Facilitation Centres and undertaking other developmental and promotional activities.

2.24 North East Regional Agricultural Marketing Corporation (NERAMAC)

2.24.1 The North Eastern Regional Agricultural Marketing Corporation (NERAMAC) Limited was incorporated in the year 1982 as a Government of India Enterprise under the administrative control of the Ministry of DoNER. The NERAMAC is intended to play the role of a dynamic and vibrant marketing organisation, supporting farmers/ producers of the NER in getting remunerative prices for their produce and enhancing the agricultural, procurement, processing and marketing infrastructure of the NER. The NERAMAC basically intervenes in aggregation of agro-horticulture produce of the North Eastern Region and provides assistance in marketing of these produce to the outside market in India. To exploit the huge potential of organic products grown in the area, the NERAMAC has recently started promoting these items through their singular aggregating brand name ‘ONE’ (Organic North East) in Delhi. These interventions of NERAMAC have helped farmers in getting better price of their produce to a large extent.

2.24.2 The challenges which the NERAMAC has encountered are mainly related to connectivity in aggregating the farm produce from far flung areas of the region. Other issues adversely affecting the growth are relating to lack of infrastructural facilities available in the region for procurement, transportation, storage, marketing and processing of agro-horti produce. The NERAMAC in its own way is trying to overcome these challenges in consultation with the stake holders.

2.24.3 The Committee was informed that a perspective plan for expansion of activities of the NERAMAC, through the revival plan, has been worked out by the NEDFI which is under validation by the IIM, Shillong. The proposed plan covers operational planning, resource requirement and strategies for human resource management.

2.24.4 During the course of discussion on Demands for Grants (2018-19) the Committee expressed its apprehension on the turn-around of the Corporation by meagre allocation of Rs. 2.00 crore only. The CMD, NERAMAC explained that Rs. 2.00 crore is the amount that NERAMAC gets from the M/o DoNER as a working capital which is too small an amount to meet the operational cost of the Corporation. However, the Corporation receives some funds from Advocacy and Promotion Scheme under the M/o DoNER and some other projects from the M/o Agriculture. The Corporation will make a turnover of Rs. 8.00 crore in (2017-18) which will be met by rotating the working capital.

2.24.5 The Secretary, DoNER while submitting before the Committee explained that an amount of Rs. 2.00 crore was given as a loan to the NERAMAC, which they use to meet the expenses on salary, etc., and also take up some purchase of raw material. Under the publicity scheme, the Ministry gives grants to the PSUs to hold various exhibitions and sales centres at various locations in the country.

2.24.6 The Committee asked the Secretary, Ministry of DoNER to furnish a detailed note on the various activities undertaken by the NERAMAC and the steps taken for its revival. In response, the Ministry of DoNER mentioned that in an effort towards the turnaround of the activities of the Corporation, the Ministry together with the NERAMAC has taken various steps during the last one year by adopting two pronged strategies. One, through infusion of capital and the other through enhancing the commercial activities of the NERAMAC.

2.24.7 The Committee was given to understand that as a step towards capital infusion, the earlier study report of the NEDFi on revival of the NERAMAC was discussed in the Department of Public Enterprises (DPE0 in June, 2017 which suggested for its updation through discussions with the stakeholders of each of the North Eastern States and thereafter, its validation through IIM, Shillong. After consultation with the representatives of these stakeholders of the region in

34 the month of July-August, 2017, the NEDFi finalised its report which is expected to be validated by IIM, Shillong by second week of March, 2018. The study suggests for restructuring of the NERAMAC through onetime package. The discussions with the stakeholders and the study has envisaged the role of the NERAMAC as an Organisation which is essential to provide information on market demand to the State Government agencies working in the field; facilitate logistic & support service to Farmers Producers Organization (FPOs) & Co-operatives to market their produce; encourage value addition and help entrepreneurs to market their processed products; promote produce of the NER as whole so as to improve their visibility in domestic as well as international market. Based on the Validation Report, the proposal for revival package would be submitted to the Ministry of Finance for approval. In the meantime, to scale up the capital infusion to the NERAMAC, the Ministry also submitted a proposal to the Ministry of Finance for a loan of around Rs. 18.80 crore in two years but they have suggested that the NERAMAC may explore the loan from the State Bank of India/Nationalised Banks through monetisation of its current assets. The NERAMAC is examining this aspect of raising loan through monetisation of its assets.

2.24.8 The Committee was also informed that as a part of business strategy, the NERAMC has taken various steps towards the setting up of new outlets, visibility enhancement by participating in various activities and to utilise the idle processing units to operate on PPP model. Some of the major initiatives taken for promoting organic produce during the current financial year are as under:-

(i) The Ministry of Agriculture and Farmers Welfare and the Ministry of DoNER have provided a space to the NERAMAC in Dilli Haat, INA “Organic Northeast Showroom cum Restaurant” under its umbrella brand “ONE” (Organic North East). This brand has been launched through its pilot project under MOVCDNER scheme connecting the consumers to northeast produce and cuisine it has been created.

(ii) Towards the initiative of exploring new market in all NE State capitals to give opportunity to the farmer community at minimum logistic expense, an outlet in the name of ‘Organic Hub’ has recently been allotted to the NERAMAC at Punjabari, Guwahati, Assam on revenue sharing basis.

(iii) Focusing the NER to become ORGANIC HUB, the NERAMAC also started supplying Seeds and Planting materials meant for organic farming produced inside NER under various Govt. Schemes. It is also preparing a project on establishing the NER as Organic hub for producing organic seeds and planting material in the country.

(iv) The NERAMAC is in the process of signing agreements for three outlets allotted at different Metro stations in Delhi to promote NE organic produce under the Brand ‘ONE’ and also to operate them on commercial lines.

(v) The NERAMAC is working as consultant for Ministry of Agriculture & Farmers welfare towards the setting up integrated processing plants in all 8 states under MOVCDNER to NERAMAC along with NEDFi and IIFPT.

(vi) The NERAMAC has been identified as lead aggregator by the MOA&FW under MOVCNER for NER produce.

(vii) The NERAMAC has started directly interacting with 100 Farmer Producers Organization (FPOs) under MOVCDNER for providing market linkages to the farmers.

2.24.9 The Ministry further informed about the other steps taken by the NERAMAC for promotion of Agro-horti produce, which are enumerated below:-

(i) To mitigate the problem of high cost of logistics, the NERAMAC has created a viable model to airlift the Agri-Horti produce and export the same to Dubai. This action will enhance the holding life of produce reducing the damage.

(ii) The NERAMAC has launched its own brand for fresh produce of the NER under the name of “NE Fresh” to popularise them among the masses outside the region which will optimize the income of farmers.

(iii) The NERAMAC is in the process of getting license for using the recently allotted space in Azadpur Mandi by APMC for storage and also as a platform for selling of Agri- Horti produce of the NER.

(iv) Acting as a lead aggregator, the NERAMAC is also trying to auction the North East produce through the platforms of e-auction for providing remunerative prices to the farmers. Sale of ginger from Nagaland through using the e-auction platform of MSTC is one such example set by the NERAMAC in the current financial year.

(v) The NERAMAC has recently received GI registration for three produce viz. MIZO- BANANA, TRIPURA-JACKFRUIT and NAGA-CUCUMBER. The NERAMAC has altogether 13 GI registrations in its name.

(vi) The NERAMAC has started the options to utilise the idle infrastructure in a commercial way. In this regard, the NERAMAC has got a partner for Barnyhat Ginger processing plant in Meghalaya to run on PPP model and efforts are on to get more partners for other infrastructure located at different places in other States. Through this exercise, the NERAMAC would not only be able to get additional revenue but also manage to reduce its recurring expenses.

2.24.10 The Committee has also been apprised that the NERAMAC has been organizing as well as participating in various events, exhibitions, buyer-seller meet, etc. for showcasing the North East produce for their promotion and attracting investors in the sector. For this purpose, the NERAMAC has organised/participated in big events like the World Food India (WFI), World Organic Congress (WOC), Indus Food, Vibrant North East, North East Calling, Destination North East. Participation in such events not only give exposure to farmers about the best practice of farming and visibility of produces of the NER but will also give buyers and markets a choice for the produce. Such events also attract investors in setting up of food processing plants in NER.

2.24.11 The Committee takes into account the efforts undertaken by the Ministry in coordination with the NERAMAC management through infusion of capital and enhancing the commercial activities of the NERAMAC by promoting organic produces, Agro-Horti produce and organising and participating in various events, exhibitions, buyer-seller meet etc. The Committee, however, expresses a serious concern over the poor financial position of the NERAMAC and insufficient intermediary steps undertaken by the Government to improve its financial viability. The Committee fails to understand as to how a corporation with negative networth is mandated to implement its core activities viz. creation of a world

36 class infrastructure for processing, value addition and marketing of agricultural allied goods in the NER. The procedural delay in sanctioning amount of Rs. 7.11 crore as working capital to carry out its business activities as a part of Rs. 20.86 crore, as one time fund requirement, mars the prospects of the revival of the Corporation. The Committee, therefore, strongly recommends that the Government must consider and implement the revival package for the NERAMAC without further delay, as sooner the revival package for the NERAMAC is implemented better it would be not only for the Corporation but also for the entire agricultural allied sector in the NER.

2.25 North Eastern Handicrafts and Handlooms Development Corporation Limited (NEHHDC)

2.25.1 The NEHHDC performs developmental and promotional activities through the funds that flows to it as grant-in-aid from various Ministries like Ministry of DoNER and Ministry of Textiles. Moreover, NEHHDC also incurs additional expenditure which is required for the successful implementation of schemes for the development of artisans and weavers of the North Eastern Region from the revenue generated out of its own trading operations. The following table shows that the actual capital expenditure to the tune of Rs. 2.00 crore was incurred in 2016-17 by the NEHHDC as loan amount to cover its cash losses through various promotional activities:-

(Rs. in crore) Heads of Actual BE RE BE Accounts 2016-17 2017-18 2017-18 2018-19 Revenue ------Capital 2.00 2.00 2.00 2.00 Total 2.00 2.00 2.00 2.00

2.25.2 During 2017-18, an amount to the tune of Rs. 2.00 crore was earmarked and the same amount has been earmarked in BE 2018-19.

2.25.3 Pertaining to the details of revival plan indicating current status thereof, total amount allocated and released so far for the purpose, the Committee was informed that the Revival Plan for the NEHHDC was approved by the CCEA on 21 st February, 2013. The total financial outlay under the revival plan was Rs. 91.56 crore. The details of financial restructuring under the Plan are as under:-

2.25.4 Infusion of Rs. 6.50 crore as fresh equity in two installments (Rs. 4.00 crore in the first year and Rs. 2.50 crore in the second year)

(i) Rs. 2.00 crore for the VRS to 20 employees.

(ii) Conversion of loan of Rs. 32.02 crore and accrued interest of Rs. 47.04 crore (total: Rs. 83.06 crore) as on December 2011 into equity and simultaneous write off.

2.25.5 The implementation of the revival plan commenced from 1 st April, 2014 after infusion of Rs. 4.00 crore as fresh equity on 21 st March, 2014. Rs. 2.00 crore was also infused on 31 st March, 2014 and 22 employees were separated on VRS from 1 st April, 2014. The second installment of fresh equity was infused in March 2015. The outstanding loan and accrued interests thereon totalling Rs. 83.06 crore was converted into equity and written off simultaneously. The extended timeframe of the implementation of the Plan is up to 31 st March,

2018 and M/s North Eastern Handicrafts and Handlooms Development Corporation Limited is expected to break even at a sales turnover of above Rs. 19.00 crore by 31 st March, 2018.

2.25.6 The losses of the Corporation have been reduced over the past years. The details of the losses have been tabled as below:-

(Rs. in crore) Year 2015 -16 2016- 17 2017-18 (Estimated) Sales (Net) 12.15 14.74 above 19.00 Operating Loss (1.92) (1.13) 0.00

2.25.7 During the course of discussion of Demands for Grants (2018-19), the Secretary, NEC submitted before the Committee that like the NERAMAC, allocation of Rs. 2.00 crore given to NEHHDC in 2018-19 is for working capital and salaries, however, the turnover during 2017-18 would be the tune of Rs. 19.00 crore as compared to Rs. 14.00 crore.

2.25.8 The Committee was given to understand that the North Eastern Handicrafts and Handlooms Development Corporation Limited (NEHHDC) has been successful in reducing the losses over the years and is expected to break even by the end of 31 st March, 2018. The Committee hopes that things turn out as expected and the NEHHDC after breaking even in March 2018 will start earning profit thereafter.

CHAPTER - III

SCHEMES, POLICIES AND PROGRAMMES

3.1 Vision 2020

3.1.1 The Committee was apprised about the details of the Vision 2020 Document which includes strategies for economic and infrastructure development to achieve the cherished goal of balanced economic growth and development of the North Eastern Region. The Ministry informed the Committee that strengthening of the infrastructure and developing connectivity in the North Eastern Region are major thrust areas identified by the Vision Document. Several connectivity initiatives have been undertaken, which inter alia include the Special Accelerated Road Development Programme for North East (SARDP-NE), Broad Gauging & Capital Connectivity Rail Projects, Comprehensive Telecom Development Programme and Schemes for Strengthening of Transmission and Distribution system.

3.1.2 The Committee was informed that a number of sectoral initiatives have been undertaken to promote livelihoods, particularly in the sectors in which the region has a comparative advantage. In view of the potential of organic farming in the North Eastern Region, the Mission, ‘Organic Value Chain Development for North Eastern Region’ was envisaged with an aim to develop certified organic production in a value chain mode, to build up a bridge between growers and consumers, and to support the sustainable development of entire value chain starting from provision of inputs, seeds, planting materials, and certification to the creation of facilities for collection, post harvest management, aggregation, processing, marketing and brand building.

3.1.3 The Ministry also informed the Committee that a restructured National Bamboo Mission has been launched with an outlay of Rs. 1290.00 crore to address the complete bamboo chain and to promote bamboo sector in a holistic manner. Under the Scheme for Agro-Marine Processing and Development of Agro-Processing (SAMPADA), which has an objective of providing modern infrastructure for food processing units in the country, grants-in-aid are provided to the North Eastern States on more concessional terms as compared to the other States.

3.1.4 The Committee was further informed that the North East Region Textile Promotion Scheme (NERTPS) is being implemented with some specific objectives, which include increasing the value of textile production, up-gradation of technology, improvement in design capability, diversification of product lines and value addition, better access to domestic and export markets, cluster formation and improvement in labour productivity, market access and market promotion. The Scheme, ‘Swadesh Darshan–North East Circuit’ is being implemented for promotion of tourism in the North Eastern Region.

3.1.5 The Ministry of Development of North Eastern Region (DoNER), through its schemes of Non-Lapsable Central Pool of Resources (NLCPR) and schemes of North Eastern Council (NEC), has also taken steps to bridge the social and physical infrastructure gaps in the North Eastern Region.

3.1.6 The Committee takes note of the thrust areas of Vision 2020 Document which inter- alia includes inclusive growth, poverty eradication, rural sector, infrastructure, human resource development, banking, industries and tourism. As the year 2020 is approaching, the Committee feels that progress of the projects, undertaken under Vision 2020 39

Document, should be reviewed by Ministry of DoNER along with the Ministries concerned to assess the current status vis-a-vis the set targets and make requisite policy modification/intervention to ensure their completion within the stipulated time frame to achieve the objectives of mission of Vision 2020. 3.2 Status of Infrastructural Projects under NLCPR and NEC Schemes

3.2.1 The Ministry of DoNER informed the Committee that, as on 31 st December, 2017, a total of 1643 projects had been sanctioned under the NLCPR Scheme, out of which 992 projects had been completed and 651 projects were at various stages of completion. The deadline of completion of these projects is March 2020. State-wise details of completed and ongoing projects are as under:-

State No. of completed No. of ongoing projects projects Arunachal 99 117 Pradesh Assam 241 205 Manipur 120 57 Meghalaya 54 53 Mizoram 100 59 Nagaland 102 67 Sikkim 191 56 Tripura 85 37 Total 992 651

3.2.2 State-wise summary of the status of ongoing and completed infrastructural projects under North Eastern Council is given below:-

(a) Ongoing projects (Rs. in lakh) State No. of projectsApproved cost NEC's share NEC Release (Amount) Arunachal Pradesh 19 60022.96 54020.36 28778.52 Assam 12 35729.34 32186.41 27295.62 Manipur 31 52051.68 46846.51 35299.34 Meghalaya 11 20696.96 18627.26 12190.64 Mizoram 13 55845.21 50325.39 32256.12 Nagaland 23 43768.19 39421.36 32686.81 Other Agencies 9 46994.00 41332.40 33999.73 Sikkim 10 17381.78 15643.60 11516.72 Tripura 6 31085.55 28027.00 24899.88 Grand Total 134 363575.67 326430.29 238923.37

(b) Completed projects (Rs. in lakh) Sector 2014-15 2015-16 2016-17 2017-18 No. of Total No. of Total No. of Total No. of Total projects Cost projects Cost projects Cost projects Cost Arunachal - - - - 1 7800.00 2 8181.00 Pradesh Assam - - - - 5 17273.59 1 1143.00 Manipur - - 3 503.60 7 5927.94 - - Meghalaya 3 5305.72 6 12784.39 4 19007.37 2 929.55 Mizoram 8 9913.29 4 6121.00 1 499.00 5 10173.36 Nagaland 1 495.51 - - 7 15447.13 1 469.58 Sikkim 3 1091.77 3 3223.94 6 2488.43 1 2526.00 Tripura - - 2 824.42 2 8527.98 3 10273.05 Other 1 3206.00 1 951.00 - - - - agencies Total 16 20012.29 19 24408.35 33 76971.44 15 33695.54

3.3 Creating new and improving existing infrastructure in NER

3.3.1 The Ministry of DoNER apprised the Committee that government has taken a number of steps to create new, and improve the existing, infrastructure in NER. These steps inter alia include concerted efforts to boost road, rail, air, waterways, power and telecom connectivity in NER through ongoing and new schemes/projects, being implemented by various Central Ministries/Departments. Sector wise details of these initiatives undertaken are as follows:- 3.4 Special Accelerated Road Development Programme for North East (SARDP-NE) 3.4.1 The Special Accelerated Road Development Programme for North East (SARDP-NE) was formulated by the Ministry of Road Transport & Highways with a view to improve the existing network of the National Highways in the region, connect all the District Headquarters with the nearest National Highway by a 2-lane road, provide inter-state connectivity, provide connectivity with the neighbouring countries and construct strategic roads. Out of 10141 km. of roads included under SARDP-NE, 4099 km. has been approved by the Government for implementation under Phase ‘A’ of SARDP-NE and 2319 under the Arunachal Pradesh Package of Roads and Highways (APPRH). The balance 3723 km. is included under Phase ‘B’ of SARDP-NE and has been approved only for preparation of DPR.

3.4.2 The Committee sought to know the latest status of the Special Accelerated Road Development Programme Phase ‘A’ covering 4099 km. and North East (SARDP-NE) Arunachal Pradesh Package of Roads and Highways covering 2319 km. In response, the Committee was informed that out of total length of 4099 km. (modified length 3877 km. based on DPR) approved for execution/implementation under Phase ‘A’ of SARDP-NE, work in about 3215 km. have been sanctioned so far at a cost of Rs. 30,732 crore. Out of these, 1783 km. has been completed so far.

3.5 Bharatmala Pariyojana

3.5.1 The Committee was also informed that the government has also approved the Bharatmala Pariyojana which is a new umbrella program for the highways sector that focuses on optimizing efficiency of freight and passenger movement across the country by bridging critical 41 infrastructure gaps through effective interventions like development of Economic Corridors, Inter Corridors and Feeder Routes, National Corridor Efficiency Improvement, Border and International connectivity roads, Coastal and Port connectivity roads and Green-field expressways. Under this scheme, road stretches aggregating to about 5301 km. in NER have been approved for improvement. Out of this, 3246 km. road length has been approved for development of Economic Corridor in North East, 96 km. for feeder roads, 855 km. for border roads & 1104 km. for roads providing international connectivity.

3.6 Status of Major Roads

3.6.1 The Committee sought to know the present status of construction/renovation of some important roads in NER.

Melli–Nayabazar–Legship–Geyzing Road

3.6.2 The Committee enquired about the status of construction of the various stretches of the Melli–Nayabazar–Legship–Geyzing Road in the South and West Sikkim districts. The Ministry submitted the status of the Road as under:-

Date of Sanctioned Cumulative NHDP S. Implementing Length Original/ Cost Physical Name of Project Phase/ No. Agency (km) Revised (Rs. in progress Scheme Sanction crore) (%) Construction of 2 182.28 59% lane road from SARDP-NE (Original) (Original) 1 Melli-Manpur- Sikkim PWD 32 3/1/2013 Phase-A 269.14 46% Namchi in South (Revised) (Revised) Sikkim Construction of 2 lane road from SARDP-NE 2 Tarku-Damthang- Sikkim PWD 32 18/04/2013 166.27 38.00% Phase-A Namchi in South Sikkim Construction of 2 lane Nayabazar- SARDP-NE 3 Sikkim PWD 24 18/04/2013 151.59 41.00% Legship road in Phase-A West Sikkim

3.6.3 The committee observes that the construction on the various sections such as Melli- Manpur-Namchi, Tarku-Damthang-Namchi and Nayabazaar-Legship had begun way back in 2013. Even after the passage of nearly 5 years, none of the stretches is near the completion stage. These are major roads that provide connectivity in the South and West Sikkim Districts and are important for both the local population and incoming tourists. The Nayabazar-Legship road, having a length of mere 24 km., has seen a physical progress of just 41 per cent in a span of nearly 5 years. The cumulative physical progress with regard to construction of two lane roads from Tarku-Damthang-Mamchi and Melli- Manpur-Namchi in South Sikkim is 38 per cent and 46 per cent, respectively. The Committee is of the view that progress achieved in half a decade is not at all satisfactory. Though hilly terrain and weather conditions create adverse conditions for completion of these road projects, it may be noted that these projects are going on since 2013. The Committee, therefore, strongly recommends that the Ministry must urgently conduct an audit of construction activities of these roads and must seek explanation from the Sikkim PWD for the extremely snail-pace of the works pertaining to these roads. The Committee also recommends that accountability may be fixed/enforced for this non-performance and

42 remedial measures should be taken urgently to expedite the completion of these Roads. The Committee desires to be apprised of the action taken in this regard.

Tezpur–Bomdilla Road

3.6.4 The Ministry informed that this stretch is being implemented by the Border Roads Organisation through the Indo-China Study Group funding of the Ministry of Defence. The segment of the road from Ballipara to Tawang (317 km.) is being upgraded from single lane to double lane, out of which 150 km. has been completed in all respects and the remaining work is in progress. The road inside Bomdila has been resurfaced and 11 km. bypass road is under construction. 28 km. road (CH: 70-88 km. & 106-116 km.), which was segregated from the main project has got the wildlife clearance and DPR has been prepared. Sanction is in process and work will commence in next financial year.

Dimapur–Kohima Road

3.6.5 The Committee was informed that the 4-laning of NH-39 from Dimapur to Kohima, in the State of Nagaland, has been awarded by the NHIDCL in three contract packages. The current status of this road is as under:

4-laning of Total Project Completion Scheduled Physical S. Dimapur- Length Appointed Cost Period /likely date of progress No. Kohima (km) Date (Rs. in Crore) (in months) completion (in %)

Section of NH-39 1 from Km 123.840 14.94 489.01 36 16.09.2016 15.09.2019 18.3% to km 138.775 Section of NH-39 2 from Km 138.775 13.72 519.72 36 27.05.2016 26.05.2019 26.63% to km 152.49 Section of NH-39 3 from km 152.49 14.21 562.98 36 30.5.2016 29.5.2019 9.67% to km 166.700 A Total (Civil 42.87 1571.71 work)

3.6.6 The Committee takes note of the progress of the 4-laning of Dimapur–Kohima road in its different sections and observes that the progress is not satisfactory at all. This project was to be completed in 36 months, yet, on two of the three sections; the physical progress is of just 26.63 per cent and 9.67 per cent after more than 18 months i.e. 50 per cent of the completion period. The Committee apprehends that, at this pace, the project will not be completed by its scheduled date of completion unless the Ministry redoubles its efforts and tries its best to expedite the construction work.

Wokha-Merapani Road

3.6.7 The Committee enquired about the status of the Wokha–Merapani road from the Ministry pursuant to news reports that the road was in a very poor state and that there were some irregularities in the awarding of the contract by the National Highways and Infrastructure Development Corporation Ltd. (NHIDCL). The news report had mentioned that the agency that had been awarded the contract was based in Uttar Pradesh and had no prior experience in construction of roads in the North Eastern Region, which has a very different geographical terrain and weather conditions. The NER is prone to heavy rainfall and landslides. The news

43 report had further mentioned that the main contracting agency had sub-contracted the NHIDCL project to a local company of Nagaland.

3.6.8 Responding to the Committee's query, the Ministry replied that Wokha-Merapani road is an interstate road between Nagaland and Assam and was constructed under NEC funding during 10 th Five Year Plan as a Major District Road (MDR) standard road at an estimated cost of Rs.79.28 crore (out of which a sum of Rs. 44.45 crore is meant for Nagaland portion). The road was completed in March, 2011. Due to the importance of the road it has been again taken up under North East Road Sector Development Scheme. At present works on this road is being implemented by NHIDCL. The works for this 60.00 km. road was awarded at Rs. 154.01 crore in September, 2017. As per the contract, the works would be completed within one year i.e by September, 2018.

3.6.9 The Committee sought to know the measures that are being taken to improve the roads in the State of Nagaland. The Ministry informed the Committee that there are 10 works, having a length of 70 km., which have been sanctioned at a cost of Rs. 862.00 crore and are in progress under NH (O). The NHIDCL is executing four projects having a total length of 64 km. amounting to Rs. 2217.00 crore. Tenders for three stretches having a length of 265 km. and cost of Rs. 3865.00 crore have been invited by the NHIDCL and Detailed Project Reports for two works having a length of 75 km and a cost of Rs. 2022.00 crore are under preparation.

3.6.10 The Committee takes note of the submission of the Ministry that works for this 60 km. long road was awarded at a cost of Rs. 154.01 crore in September, 2017 with a completion deadline of one year. However, the Committee observes that the Ministry has not intimated the Committee whether or not the construction work has begun. The Committee, therefore, strongly recommends that the Ministry of DoNER must send a team to assess the status of construction of the Wokha–Merapani road and find out whether the construction is going on as per the schedule in accordance with the set construction guidelines or not and the Committee may be apprised of the action taken in this regard. Agia-Medhipara-Phulbari-Tura (AMPT) Road, Meghalaya-Assam

3.6.11 The Committee came across the news reports that Agia-Medhipara-Phulbari-Tura (AMPT) Road, which is the main economic route connecting Meghalaya to Assam, was in a very poor state despite being renovated recently. The news reports also stated that the road began deteriorating after a few days of its renovation. The Committee thus enquired about the status of this road.

3.6.12 The Ministry informed the Committee that this is an interstate road between Meghalaya & Assam. The total length of the road is 158.67 km., out of which 25.67 km. is in Assam and the remaining 133 km. is in Meghalaya. The road starts from NH-17 at Agia and enters in Meghalaya at Medhipara. This road was constructed under the NEC funding during the 5 th Five Year Plan on an ‘Other District Road’ standard. More than 75 Nos. of RCC double lanes were also supported on this road by the NEC. The road was further up-graded and developed to ‘Major District Road’ standard with a carriageway width of 5.50 metre during the 10 th and 11 th Plan Period in two phases.

3.6.13 During the 10 th Plan period, the road portion in Assam along with 60 km. of the road in Meghalaya from Tura was taken up as Phase-I at an estimated cost of Rs. 65.65 crore for Meghalaya and Rs. 19.99 crore for Assam. The works for the road was completed during FY 2011-12 and is with the State Governments for maintenance. The balance portion of 73.00 km of the road in Meghalaya was sanctioned in the Phase-II of the project at an estimated cost of Rs.

90.64 crore in March 2010. The road was completed during 2016-17 and a final installment was also released to the Government of Meghalaya. The road is presently being maintained by the State Governments concerned.

3.6.14 The Committee takes note of the submission of the Ministry that the renovation of the Agia-Medhipara-Phulbari-Tura (AMPT) Road was completed during 2016-17 and it is presently being maintained by the State Governments concerned. However, the Committee is anguished to observe that a road that was renovated recently at a cost of Rs. 90.64 crore started deteriorating within a few days of its completion. The Committee feels that this raises a serious question over the quality of materials used in the construction and the monitoring mechanism related thereto. The Committee, therefore, strongly recommends that the Ministry must urgently conduct an audit of the road and enquire into the quality of materials used in the construction. The Committee may be apprised of the action taken in this regard. 3.7 Civil Aviation 3.7.1 The Committee was informed that the Ministry of Civil Aviation (MoCA) and the Airports Authority of India have made a road map for spreading the wings of air connectivity in the North East. The policy initiatives taken by the Government through Open Sky Policy, Look East Policy, Route Dispersal Guidelines and the budgetary support by the Ministry of DoNER have ignited the infrastructure development in the aviation sector, which inter alia set the pace of economic growth in the region thereby, reducing the gap in economic prosperity of North- East Region compared to other regions.

Long Term Strategy 3.7.2 The upgradation of the operational airports and operationalization of the existing non- operational airports is a long term strategy depending on the traffic demand and other operational requirements. The State Government of Meghalaya has also proposed to handover its non-operational airport at Tura (Baljek) to Airports Authority of India to develop it for ATR- 72 type of aircraft operations. In this regard, a draft MOU for taking over of the airport by AAI from the State Government has been forwarded to the State Government for acceptance.

3.7.3 The Ministry of Civil Aviation (MoCA), in pursuance to National Civil Aviation Policy, 2016, has launched Regional Connectivity Scheme (RCS-UDAN) in October 2016 to promote regional air connectivity in the country including North Eastern Region and creating additional infrastructure by revival of unserved and underserved airports/airstrips.92 new routes have been opened in the NE Region in the second round of RCS-UDAN Scheme.

Status of construction of all Greenfield airports in NER

3.7.4 The Committee was informed that a new Greenfield Airport has been constructed at Pakyong, Sikkim at a cost of Rs. 553.00 crore which is suitable for operation of ATR-72 type of aircraft with apron, terminal building of 100 pax. peak hour capacity and other allied infrastructure.

3.7.5 The Airports Authority of India has taken up the proposal for setting up a Greenfield Airport at Hollongi, Itanagar for construction of Runway for A320 type of aircraft (Code-C). The Hollongi site for development of new Greenfield Airport has been approved by the State Cabinet of Arunachal Pradesh. The Airport Authority of India has already started preparation of

Detailed Project Report and study on Environmental Impact Assessment (EIA). The clearances from the Ministry of Defence, the Ministry of Home Affairs and the Ministry of Finance have already been obtained. Application has been forwarded to the Steering Committee on Greenfield airports for approval. Moreover, the State Government has been requested for details of land acquisition and cost involved for approval of proposal by the MoCA. The details are awaited from the State Government.

3.7.6 The Ministry informed the Committee that the infrastructure development works at the airport have been completed and the process for obtaining license from DGCA is in progress. The pending issues include approach road to airport site which has to be constructed by the State Government and land for the Airports Authority of India Residential Colony that has to be given by the State Government.

3.7.7 In this regard, a meeting was held on 28 th June, 2017 in the office of the Chairman, AAI with all stakeholders including State Government of Arunachal Pradesh. There was a discrepancy regarding ownership of land to be acquired by State Government for the Greenfield airport. Letter from the AAI dated 14 th August, 2017 along with a Master Plan with land requirement of 667 acres for airport and another 100 acres approximately for rehabilitation has been forwarded to the State Government to intimate the cost of land involved and rehabilitation cost, etc. After getting the reply of State Government the cost can be included in the DPR to be submitted to the Ministry of Civil Aviation. The response of State Government is awaited.

3.7.8 A proposal to construct Greenfield Airport at Ruzaphema in Nagaland is also under consideration.

3.7.9 The Committee sought to know the measures that are being taken to operationalize the non-operational airports in the NER. In response the Committee was informed that there are 11 Operational Airports, 12 Non-Operational Airports and 3 three Greenfield Airports in North East Region as listed in the Table below:-

Operational -11 Non-Operational – 12 • Agartala, Along (SG - Arunachal Pradesh), • Dibrugarh, Daparizo (SG – Arunachal • Dimapur, Pradesh), • Guwahati (Int. Airport), Kailashahar, • Imphal, Kamalpur, • Jorhat (CE), Khowai, Pasighat, • Lilabari, Rupsi, • Shillong (Barapani), Tezu, • Silchar (CE), Tura* (SG-Meghalaya), • Lengpui (SG - Mizoram), Turial (Aizwal), • Tezpur (CE) Ziro ( SG- Arunachal Pradesh), Shella Greenfield Airports – Pakyong, Itanagar and proposed Greenfield Airport in Nagaland.

3.7.10 The Committee was also informed that the Ministry of DoNER through the NEC has also taken concerted efforts to provide gap funding for development/up-gradation of airport infrastructure in the NER. The revamped Tezu Airport, fully funded by the NEC at a revised cost of Rs. 96.50 crore is ready for operations for ATR 72 type of aircraft with existing 46 renovated old terminal building. The work for construction of new terminal building is in progress and likely to be completed by September, 2018.The nearest airport to Itanagar i.e. Lilabari Airport in Assam is now connected to Guwahati Airport as a result of Viability Gap Funding arrangements with Alliance Air initiated by North Eastern Council. Work is in progress/planned to upgrade/enhance features in Lilabari Airport.

3.7.11 Considering the growth in passenger traffic and aircraft movements at Guwahati Airport, the AAI has constructed a new Integrated Terminal Building having an area of 90,000 sqm with capacity to handle 3100 peak hour passengers at a time at a cost of Rs. 1232.00 crore.

3.7.12 The Committee was further informed that seven Advance Landing Grounds (ALGs) at Along, Walong, Passighat, Ziro, Tuting, Mechuka and Tawang have been upgraded and made available for dual use operations.

Night Landing Facilities

3.7.13 The Committee was also informed that creation of night landing facility at all the operational airports is another long term strategy. Night landing facilities and clearance for night operation are available for Agartala, Dibrugarh, Dimapur, Guwahati and Imphal airports out of which night operations are there at Agartala, Guwahati and Imphal.

Short Term Strategy 3.7.14 The Committee was apprised about the works pertaining to modification and expansion of existing terminal building, strengthening of runway, taxiway and expansion of apron, re- carpeting of runway, construction of hangar, fire station, operational wall, property wall, watch towers, perimeter road, storm water drains, widening of basic strip and perimeter lighting, etc. at the existing operational airports as a part of short term strategy. 3.7.15 The following works for such up-gradation are already taken up:-

S. State/ Name of the Project Amount PDC Remarks No Airport (Rs. in crore) 1. Assam Strengthening of runway and 44.77 March, 2019 Guwahati Expansion of Apron (07 bays for 'C type, with link Taxiway) New Integrated Terminal 1142.00 February, Project Management Building 2021 Consultancy (PMC) awarded on 07/03/2017 New ATC cum Technical Block 162.00 December, 2019 2. Assam Construction of one aircraft 21.07 February, Work awarded on Dibrugarh hangar for A-321/ATR72 2019 11.04.2017 Runway extension by 460m 52.31 November, Progress 30% as on along with Associated works 2018 Nov. 2017 Construction of New Control 33.93 Tower cum Technical Block 3. Assam Re-carpeting of Runway 12.98 Progress-82% Silchar New Terminal Building for 400 65.00 Planning stage pax peak hr capacity 4. Assam Modification and expansion of 4.78 March, 2018 Work in progress Jorhat existing Terminal building Construction of New Terminal 4.00 Building for 250 pax peak hr 47

capacity

5. Assam Re-carpeting of Runway 10.00 Work in progress Lilabari 6. Assam Development of Civil Enclave AAI will develop and Rupsi manage a Civil Enclave (in appx. 75 acres of land). State Govt. had carried out joint survey of airport land with IAF and AAI officials, and had demarcated the boundary of airport land 7. Tripura Construction of one Hangar for 28.60 October, Work awarded on Agartala A-321/ATR-72 type of Aircraft 2019 24.10.2017 to M/s NCC for Rs. 28.60 Cr New Integrated Terminal 438.28 October, Work awarded on Building of 1200 PkHr Capacity 2019 08.06.2017 to M/s of appx 25000 sqm& Apron for NCC. Environmental 6 additional parking Bays for A- Clearance issued on 321 type of Aircrafts 06.11.2017. Construction of new Isolation 15.57 June, 2018 Work awarded on Bay and associated link Taxi 31.05.2017 to M/s Track Surface Tech (India) Pvt. Ltd. Construction of Operational 26.97 Feb, 2018 Work in progress wall, property wall, watch towers, perimeter road, storm water drains, widening of basic strip & perimeter lighting Construction of CISF Barrack, 13.07 September, Work awarded on Dog Kennel, Kote 2018 20.03.17 8. Tripura On State Govt. request Kailashahar for development and operationalization of the Airport, AAI has prepared the master plan for ATR-72 operations and forwarded to State Govt. with acquisition of 75 acres of Land. The Master Plan has been accepted by State Govt. Further details regarding land acquisition are awaited from State Govt. 9. Manipur Apron Expansion work 11.83 Imphal Construction of New Fire 4.47 Station Construction of one Hangar with 36.90 March, 2019 Work awarded on capacity to park A-320 category 17.03.2017 aircraft Construction of new Integrated 350.00 SOW issued on Terminal Building, associated 11.05.2017 Apron, link Taxiway and allied works. 10. Nagaland Strengthening of Runway, 43.32 April, 2019 Work in progress. 48

Dimapur Taxiway and Apron Isolation Bay with Link Taxiway Planning stage. Facelift & Expansion of existing 2.00 of Terminal Building MT Workshop, Emergency Medical Centre. 11. Arunachal Expansion and development of AAI suggested for Pradesh airport for operationalization of development of a Daparizo ATR-42 type of aircraft Greenfield Airport for which three sites have been identified by State Govt. AAI requested the State Govt. for the details about these sites. The response from State Govt. is awaited. 12. Arunachal Construction of New Domestic September, Work is awarded to Pradesh Terminal Building for handling 2018 M/s MTDC (a PSU of Tezu 200 peak hour passenger and Govt. of Manipur) as construction of New ATC Tower deposit work (Rs.38.5 cum Technical Block cum Fire cr.) Station Cat-IV & associated facilities 13. Meghalaya Extension & strengthening of In the third Inter- Shillong Runway upto 7500 ft i/c Ministerial Meeting on ancillary works (Extn from 6000 Aviation Sector ft. to 7500 ft ) Schemes/Programmes to make airport suitable for A- in NER chaired by 320 type of aircraft operations Secretary, DoNER on Expansion & strengthening of 12.01.2018, AAI was Apron for parking of 4 Nos AB- advised to resolve all 321 type of aircraft with link pending issues taxiway expeditiously. Installation of ILS, Relocation of DVOR, diversion of drain along with electrical and other ancillary work 14. Meghalaya Expansion and development of DPR cost along with Tura airport for operationalization of request of 56.50 acres ATR-72 type of aircraft. of land has been submitted to State Govt. by AAI. 15. Sikkim • Runway of dimension Ready for Pakyong 1700m x 30m operationalization. • Apron 106m x 76m for parking 2 ATR-72 type of aircraft. • Terminal Building for 100 passengers. • Car park for 50 cars • Control tower cum fire station category IV

3.7.16 The Committee takes into account both the long term and short term strategies and notes that several smaller projects i.e. six in Assam, two each in Tripura and Arunachal Pradesh and Meghalaya and one each in Manipur, Nagaland and Sikkim have been undertaken for up-gradation and modification/expansion which are at various stages of completion. The Committee understands that completion of these projects would smoothen

49 the air connectivity and operational efficacy of Civil Aviation in NER. The Committee, therefore, strongly recommends that these smaller projects be completed in the stipulated time frame and without cost overruns. The Committee further recommends that the Ministry of DoNER must co-ordinate with implementing agencies and the line Ministries concerned for ensuring the speedy execution of undertaken projects at the specified pace.

3.8 Telecom Sector 3.8.1 The Committee was informed about the Comprehensive Telecom Development Project for the NER at an estimated cost of Rs. 5336.00 crore to be funded from the Universal Services Obligation Fund (USOF). The project entails the setting up of 6673 mobile towers to cover 8621 uncovered villages; setting up of 321 mobile towers along National Highways and laying of 3213 km. of Optical Fibre Cable from State Capitals to District Headquarters.

3.8.2 The ‘Bharat Net’ was launched to connect all the 2,50,000 Gram Panchayats in the country including NER for providing broadband connectivity in the Gram Panchayats in phased manner. It is being executed by a Special Purpose Vehicle (SPV) namely Bharat Broadband Network Limited (BBNL). Moreover, augmentation of Optical Fibre Cable (OFC) Network between District Headquarter (DHQ) and Block Headquarters (BHQs) in North Eastern Region by BSNL and RailTel is also going on.

3.8.3 The Committee takes note of the Comprehensive Telecom Development Project for the NER at an estimated cost of Rs 5336.00 crore to be funded from Universal Services Obligation Fund (USOF) and expects that the telecommunications network would cover State Capitals, District Headquarters and villages. The Committee hopes that the broadband connectivity at gram panchayat level would be covered by ‘Bharat Net’ within the set timeframe.

3.9 Flood Control Projects

3.9.1 The Committee sought to know the completion status and details of all the flood control projects that have been taken up under the NEC and the NLCPR in the NER. Responding to the Committee's query, the Ministry informed that up to 31 st December, 2017, a total of 174 projects have been sanctioned in flood control and irrigation sector under the NLCPR Scheme, out of which 162 projects have been completed and 12 projects are still at various stages of completion. The deadline of completion of these projects is March, 2020. The Ministry also informed that the status of flood control projects taken up under the NEC Scheme is as under:-

S. State No. of Approved NEC's Fund Remarks No. projects Cost share released 1 Arunachal 19 8885.94 7997.35 6418.99 a) 2 nos. of projects have been Pradesh closed. b) 13 nos. of projects have been released last & final installment. 2 Assam 4 2438.90 2195.01 1755.32 a) 1 no. of project has been closed. b) 2 nos. of projects have been released last and final installment.

3 Manipur 8 3912.54 3521.29 2282.70 a) 1 project has been closed. b) 1 project has been released last and final installment. 4 Meghalaya 1 1040.00 936.00 94.00 _ 5 Mizoram 1 432.16 388.94 388.94 1 project has been completed.

6 Nagaland 2 633.80 570.42 106.00 _ 7 Sikkim 2 849.01 764.11 764.11 2 projects have been released last and final installment. 8 Tripura 0 0.00 0.00 0.00 _ Total 37 18192.35 16373.1 11810.06

3.9.2 The Committee notes that 174 projects were sanctioned under the NLCPR Scheme in the flood control and irrigation sector out of which 162 have been completed and the remaining 12 are proposed to be completed by March 2020. The Committee also notes that out of the 37 flood control projects, sanctioned under the NEC Scheme, several projects are pending. In respect of some projects, particularly in Nagaland and Manipur, the NEC has not released a major chunk of its share of funds. The Committee is aware that every year flood causes havoc and timely implementation of all flood control projects is critical to the development of North Eastern Region. The Committee, therefore, recommends that the Ministry should ensure timely completion of all pending flood control projects in the North Eastern Region.

3.10 Kaladan Multimodal Transit Transport (KMTT) Project

3.10.1 The Committee was informed that in accordance with the Act East Policy of the Government, the Kaladan Multimodal Transit Transport (KMTT) Project was conceptualized by the Ministry of External Affairs (MEA) to provide an alternative connectivity to Mizoram with Haldia/Kolkata ports through the Kaladan River in Myanmar. The project envisages road transport from Mizoram to Paletwa (Myanmar), thereafter from Paletwa to Sittwe (Myanmar) by Inland Waterways and from Sittwe to Haldia/other Indian Ports by maritime shipping. The project is piloted and funded by the MEA. The detailed status of the project is as under:- (a) Port & Inland Waterways Transport Component: The MEA appointed Inland Waterways Authority of India (IWAI) as the Project Development Consultant (PDC) for Port and IWT components of the project. Based on IWAI’s recommendation, MEA had awarded the work to the successful bidder i.e. M/s ESSAR Projects (I) Pvt. Ltd for construction of Sittwe port and IWT components at a cost of Rs 342.00 crore. The phase-I of the project consisting of (i) sea port at Sittwe, (ii) inland terminal at Paletwa, (iii) dredging of approach channel at Sittwe, (iv) dredging of Kolodyne river between Sittwe and Paletwa, and (v) construction of six cargo vessels of 300 tonnes each has been completed. Beside these, additional works such as staff quarters, administrative building, warehouse, etc., were proposed at Paletwa and Sittwe. These are under progress and are scheduled to be completed by April, 2018. In the meantime, the MEA has also approved phase-II works with port and IWT component which are to be taken up soon. These works are as follows:-

(i) Preparation of DPR for a new Container at Sittwe: Draft DPR has been submitted by the Consultant and final DPR is expected by January 2018.

(ii) Wreck removal: After due tender process, IWAI has forwarded its recommendations to MEA for approval on 27 th November, 2017. The work of wreck removal is expected to be completed by April, 2018. (iii) O&M of Phase – I works: Tender for O& M of infrastructure created under phase – I is under finalization. It is expected that the work will be awarded to successful bidder by March, 2018.

(b) Cargo: As per RITES Report, prepared for IWT on River Kaladan, the cargo anticipated to be handled at the terminal is of general break-bulk category, comprising of food grains, fertilizers, cement, building materials, agricultural products, consumer goods, timber, etc., in the form of bags, cartons, bundles and logs. In the absence of detailed traffic studies/forecasts, the port terminals facilities were planned for annual throughput of one lakh tonnes cargo volume through Sittwe. Out of this, 60 to 70 per cent of the cargo is assumed to be transferred to IWT mode at Sittwe for transportation to NE States and balance for local distribution.

(c) Road Component: As far as the road construction work between Paletwa and Indo-Myanmar border at Myeikwa is concerned, the same is being carried out by MEA through IRCON.

3.10.2 The Committee takes note of the progress of the Kaladan Multimodal Transit Transport (KMTT) project that is being piloted and funded by the Ministry of External Affairs. The Committee is aware that this project was expected to be operationalised by December, 2016. However, till date, no component of the project has been completely operationalised and the road component has been languishing for a long time. This indicates a failure of monitoring and supervision. The Committee understands that this project is an integral part of the Act East Policy of India and is of strategic importance. The Committee, therefore, recommends that the Ministry of External Affairs should take ownership and responsibility for the project and that all the components of the Kaladan Multimodal Transit Transport project should be completed at the earliest to resolve the connectivity woes of the North Eastern Region.

3.11 Tourism

3.11.1 The Ministry of Tourism have informed that in order to develop the tourism sector in the North Eastern Region, the Ministry has sanctioned various projects under its Swadesh Darshan and PRASAD Schemes to develop theme-based tourist circuits for better amenities and infrastructure. The Committee desired to know the tourism promotion projects that were sanctioned under Non-Lapsable Central Pool of Resources (NLCPR) and North Eastern Council (NEC) during 2017-18. The Ministry informed the Committee that three projects pertaining to tourism sector have been sanctioned under NLCPR Scheme during 2017-18. All these projects are being implemented. Details of the projects are as under:- (Rs. in crore) S. No. Name of projects Approved cost i Development of Eco-Tourism project at 13.30 CheiraoChing, Thangmeiband, in Manipur ii Development of Cave Tourism project at the 7.50 prominent tourist sites at Khangkui Cave, Ukhrul District, in Manipur iii Development of Tourist Infrastructure for Kailash 42.23 Mansarovar Yatra in Sikkim

3.11.2 Summary of projects sanctioned by NEC during 2017-18 is given below:-

S. No Name of the Number Total NEC's NEC Remarks State of approved share released projects cost 1 Arunachal Fund released during the Pradesh month of September, 2017. 2 520.00 468.00 187.00 Progress reports are awaited. 2 Assam Fund released during the 1 360.00 324.00 130.00 month of February, 2018 3 Meghalaya Project was sanctioned 1 37.91 34.00 13.60 during the month of December, 2017 4 Nagaland Fund released during the 2 634.00 570.60 228.00 month of September, and December, 2017. 5 Sikkim Fund released during the month of September, 2017. 1 910.00 819.00 328.00 Progress reports are awaited. Total 7 2461.91 2215.60 886.60

3.11.3 The Committee was also informed that the NEC has taken initiative to establish the North East Tourism Development Council (NETDC) to take care of the promotion of tourism in NER. The North East Tourism Development Council (NETDC) was incorporated on 21 st March, 2017 as a Section 8 Company under the Companies Act, 2013 with its registered office in NEC, Shillong with shareholdings of the private sector tourism-stakeholders from the Region. The main objectives of the NETDC are to promote and support tourism in the North Eastern Region by identifying and promoting theme-based regional and international circuits, branding and marketing of North East India Tourism–Paradise Unexplored, play an advisory role in policy making at regional level, work as a nodal agency for coordination with the Ministry of Tourism, Ministry of DoNER, other Central Ministries, Tourism Departments of the States and make arrangement of funds for projects at regional level and address other developing issues for promotion of tourism in the North Eastern Region of India.

3.11.4 The Committee sought to know the steps taken to develop niche tourism/high-end tourism in the NER. In response, the Ministry of Tourism informed the Committee that there is scope for promotion of more river cruises in the region, particularly, subsequent to the new India-Bangladesh Protocol on passenger traffic which essentially allows free movement of passenger vessels between India and Bangladesh. The Ministry has also identified pilgrimage tourism circuit on National Water Way-2 (Brahmaputra River) for development and has requested the State Governments to submit proposals for financial support wherever required. The Ministry supports Golf Tournaments in the North East within the scope of the guidelines for promotion of Golf Tournament.

3.11.5 As regards the steps taken during the financial year 2017-18 by the government to promote educational tourism in NER and in the financial year 2018-19, the Committee was informed that the Ministry of Tourism has planned to set up a new institute under the administrative control of the Ministry of Tourism during 2018-19. The Ministry of Tourism through its Autonomous Body i.e. Indian Institute of Tourism and Travel Management (IITTM), Gwalior has decided to open a new centre at North Eastern Region with an aim to make

53 education more accessible and providing qualified Human Resource for Tourism and Allied services. As the setting up of new centre requires a considerable time, the Institute of Hotel Management (IHM), Guwahati has been requested to provide 4 rooms for IITTM, Gwalior to open a new centre for North Eastern Region and to start various trainings/ capacity building programmes. In the NER, IHM Shillong and IHM Guwahati are operational.

3.11.6 The Committee was also informed that during 2017-18, the NEC has supported a programme ‘Capacity Building for Tourism for Food Craft Institute, Tura’. During 2018-19 onwards the NETDC is proposed to be strengthened appropriately and carry forward the objectives of promoting tourism in the Region.

3.11.7 The Committee further sought to know the steps that were taken for placing Shillong and Gangtok as global tourist attractions. In response to that the Committee was informed that the Ministry of Tourism provides Central Financial Assistance (CFA) to State Governments upon the receipt of proposals and their adherence to the Ministry’s various scheme guidelines. Among the two projects sanctioned by the Ministry for Sikkim under Swadesh Darshan Scheme, one of the projects includes development of some sites in Gangtok.

3.11.8 The Committee was further informed that steps have been taken to involve the Rajiv Gandhi Indian Institute of Management (RGIIM), Shillong to provide strategic Policy support for development of different Critical Sectors including Tourism. An MOU in this regard was signed on 15 th October, 2016 between Ministry of DoNER, New Delhi, North Eastern Council, Shillong and Rajiv Gandhi Indian Institute of Management (RGIIM), Shillong.

3.11.9 The Committee during the meeting held on 26 th February, 2018, raised a query with regard to the status of ongoing construction/renovation work at Mahabali Temple in Imphal East which was a project initiated in the year 2013-14 with sanctioned amount of Rs. 460.00 lakh. The representative of the Ministry of Tourism replied that the construction/renovation work has stopped due to certain legal and administrative issues.

3.11.10 The Committee also raised the issue of checking erosion in Majuli Islands and steps taken thereon. The Ministry of Tourism replied that the Brahmaputra Board has been allocated Rs. 207.00 crore for the purpose of protecting Majuli Island from flood and erosion caused by river Brahmaputra. The work has started recently and Rs. 100.00 crore has also been released.

3.11.11 The Committee takes note of the implementation status of various projects under Swadesh Darshan and PRASAD Schemes of the Ministry of Tourism that aim to develop theme-based tourist circuits, and create improved amenities and necessary infrastructure for promotion of tourism in the States of North Eastern Region. However, the Committee finds that an amount of only Rs. 686.19 crore have been released during 2014-15, 2015-16 and 2016-2017 on various projects under Swadesh Darshan Scheme, as against the sanctioned amount of Rs. 1267.49 crore, which is matter of serious concern. The Committee, therefore, recommends that the Government must ensure a release of the sanctioned amount for timely implementation of the undertaken projects.

3.11.12 The Committee also takes note of the projects related to tourism promotion that are being implemented under the NLCPR and NEC Schemes and hopes that concerted efforts would be made to implement these projects for developing niche and high end tourism in the NER.

3.11.13 The Committee also desires that the Ministry of Tourism should harness the potential of the NER for promoting river cruises and promote identified pilgrimage

54 tourism circuit on National Waterway-2 (Brahmaputra River). The Committee hopes that the decision of the Ministry of Tourism to open a new centre/institutes of Indian Institute of Tourism and Travel Management (IITTM) with an aim to make education more accessible and providing qualified Human Resource for Tourism and Allied services for North Eastern Region States, would lead to desirable outcomes.

3.11.14 The Committee recommends that the construction/renovation work of Mahabali Temple in Imphal East sanctioned since 2013-14, must be completed at the earliest.

3.11.15 The Committee observes that the amount allocated for the purpose of protecting Majuli Islands from erosion is not adequate and recommends that the amount must be increased at RE stage.

3.12 North Eastern Industrial and Investment Promotion Policy (NEIIPP)

3.12.1 The Committee sought to know about the measures that are being taken to develop an exclusive investment promotion policy for the North Eastern states. In response to that the Ministry informed the Committee that the Department of Industrial Policies and Promotion (DIPP) was implementing North East Industrial and Investment Promotion Policy (NEIIPP) 2007, which was notified w.e.f. 1 st April, 2007 and remained in force up to 31 st March, 2017, to boost industrialisation in the North Eastern Region. The Government has constituted a Committee under the Chairmanship of CEO, NITI Aayog consisting of Secretaries of several other Ministries/Departments and the Ministry of Development of North Eastern Region to examine and suggest a roadmap for a new industrial policy for North Eastern and Himalayan States. The Committee was constituted in December, 2016 and held consultations with stakeholders and after detailed deliberation, had recommended a new industrial development scheme for North Eastern Region. However, the same is under approval of the Competent Authority.

3.12.2 The Committee also wanted to know about the steps taken for pragmatic land use policy for attracting industries in the region and encouraging Micro, Small and Medium Enterprises (MSME). In response, the Ministry informed the Committee that in order to supplement State Governments’ efforts, several Union Ministries have initiated schemes pertaining to infrastructure development for promotion of Micro, Small and Medium Enterprises. The MSME is implementing a scheme, namely, Promotion of MSMEs in the Region. The BE for said scheme is Rs 5.00 crore for 2017-18, out of which Ministry has released Rs. 2.50 crore as on 31 st December, 2017. One of the components of this scheme is ‘Development of new and existing Industrial Estates’, under which 80% of the cost of infrastructure facilities not exceeding Rs. 8 crore is sanctioned as financial assistance for development of new and existing industrial estates. The infrastructure facilities will include power distribution systems, water, telecommunications, drainage and pollution control facilities, roads, banks, storage and marketing outlets, etc.

3.12.3 Further, Ministry of Food Processing Industries (MoFPI) has launched a new Central Sector Scheme, namely, SAMPADA (Scheme for Agro-Marine Processing and Development of Agro-Processing Clusters) for the period 2016-20 coterminous with the 14 th Finance Commission cycle. The objective of SAMPADA is to provide modern infrastructure for food processing units in the country and to address the need of small and micro food processing enterprises by providing appropriate facilities.

3.12.4 The SAMPADA is an umbrella scheme incorporating ongoing schemes of the Ministry like Mega Food Parks, Integrated Cold Chain and Value Addition Infrastructure, Food Safety and Quality Assurance Infrastructure, etc. and also new schemes like Infrastructure for Agro- processing Clusters, Creation of Backward and Forward Linkages, Creation / Expansion of Food Processing and Preservation Capacities.

3.12.5 Under SAMPADA, grant-in-aid is provided on more concessional terms for the North Eastern Sates as compared to other States. Under the sub-scheme for Mega Food Park, NER states receive grant-in-aid at the rate of 75 per cent of eligible project cost subject to maximum of Rs. 50.00 crore per project compared to at the rate of 50 per cent of eligible project cost in general areas.

3.12.6 Ministry of Textiles is implementing a NE specific scheme, namely, North East Region Textile Promotion Scheme (NERTPS). The broad objective of the North East Region Textile Promotion Scheme (NERTPS) is to develop and modernise the textile sector in NER by providing the required Government support in terms of raw material, seed banks, machinery, common facility centres, skill development, design and marketing support, etc. The scheme covers all textile sub-sectors, the traditional Village and Small Enterprises including handlooms, power looms, handicrafts, sericulture, jute, allied fibres, and garmenting, etc.

3.12.7 In convergence with Central Ministries' schemes, the NEC has provided gap funding assistance to State Governments for promoting industrialisation. Notably, assistance for power supply, water, approach road and internal roads has been provided to Luangmual Industrial Growth Centre, Aizawl, Mizoram where an Apparel and Garment Manufacturing Centre was set up by the Ministry of Textiles under the North East Region Textile Promotion Scheme (NERTPS). Likewise, construction of work sheds in new industrial estates under MSME Scheme at Thoubal and Bishnupur in Manipur were also sanctioned to enable first generation entrepreneurs to start their units. Besides, under the scheme support has been provided for bamboo cluster projects, incense sticks clusters, tea processing and agro-horticulture processing units.

3.12.8 The Committee observes that North East Industrial & Investment Promotion Policy (NEIIPP), 2007 has come to an end on 31 st March, 2017 and a new industrial policy for the North Eastern and Himalayan States is under consideration of the Government. Therefore, the Committee desires that the Government should not delay in approving the new industrial development scheme for the North Eastern Region. The Committee also desires that the Ministry of Micro, Small and Medium Enterprises (MSME) should popularize promotion of MSMEs in NER for more employment and specific steps taken in this regard may be intimated to this Committee.

3.13 Agriculture And Food Processing Sector

3.13.1 As regards the measures that were taken to develop Agriculture and Food Processing Sector in NER during the last two years, the Ministry informed the Committee that there is a scheme called Mission Organic Value Chain Development for North Eastern Region of M/o Agriculture and Farmers Welfare. The scheme aims at development of certified organic production in a value chain mode to link growers with consumers and to support the development of entire value chain starting from inputs, seeds, certification and creation of facilities for collection, aggregation, processing, marketing and brand building, etc. The scheme was approved with an outlay of Rs. 400.00 crore for three years.

3.13.2 The assistance is provided for cluster development, on/off farm input production, supply of seeds/planting materials, setting up of functional infrastructure, establishment of integrated processing unit, refrigerated transportation, pre-cooling /cold stores chamber, branding labelling and packaging, hiring of space, hand holdings, organic certification through third party, mobilization of farmers/processors, etc. Under this scheme, an area of 50,000 hectare have been targeted to be covered under organic farming in North Eastern Region of the country during the period of three years i.e. from year 2015-16 to 2017-18.

State–wise Budget allocation, Release and Utilization received during 2015-16, 2016-17 and 2017-18

(Rs. in lakh) S. No. States Budget Amount Budget Amount released allocation released allocation 2016-17 2016-17 2017-18 2017-18 1 Assam 526.22 231.98 1423.47 - 2 Manipur 1102.88 736.79 1788.42 894.21

3 Meghalaya 926.1 463.05 940.71 705.53

4 Nagaland 1244.85 1244.85 1927.75 963.87

5 Mizoram 1300.35 969.09 583.44 - 6 Arunachal 1053.36 522.65 1181.45 590.73 Pradesh 7 Sikkim 2077 0 687.88 - 8 Tripura 594.24 594.24 491.88 245.94 Total 8825.00 4762.65 9025.00 3400.00 Office 1175.00 105.77 975.00 26.14 Expenses Grand 10000.00 4868.42 10000.00 3426.14 Total

Physical progress (Rs. in crore) Year BE RE Expenditure 2016-17 100.00 100.00 47.63 2017-18 100.00 100.00 34.02

3.13.3 The Committee takes note of the scheme called Mission Organic Value Chain Development for North Eastern Region implemented by the Ministry of Agriculture and Farmers Welfare for providing cluster development. The Committee hopes that the undertaken scheme would promote integrated agriculture and food processing units in NER. However, the Committee expresses its concern that an amount of only Rs. 4762.65 lakh was released against the budget allocation of Rs. 8825.00 lakh in the year 2016-17 and an amount of just Rs. 3400.00 lakh was released against the budget allocation of Rs. 9025.00 lakh during the year 2017-18. The Committee also observes that the budgetary allocations under this scheme have not been optimally utilised. The Committee, therefore, recommends that the fund utilisation should be improved under this scheme and all the bottlenecks that prevent optimal utilisation of the funds may be resolved at the earliest.

3.14 Environment and Forests 3.14.1 The Committee sought to know about the major threats to environment and forests in the NER and also about future road map to tackle these challenges. In response, the Ministry informed the Committee that as per the India State of Forest Report (ISFR), 2017 of Forest Survey of India (FSI), Dehradun, the total forest cover in the North Eastern Region is 1,71,306 sq.km., which is 65.34% of its geographical area. There has been a decrease of forest cover to the extent of 630 sq. km. in this region in comparison to the FSI assessment as per ISFR, 2015. The reasons for decrease are mainly attributed to shifting cultivation and other biotic pressures prevalent in the region.

3.14.2 As regards the measures taken during the last two years to ensure conservation of environment and forest resources in NER, the Committee was informed that satellite based forest fire alerts are provided to all State/UT Forest Departments including the frontline forest officials up to beat level and other registered users through SMS and e-mail by Forest Survey of India, Dehradun.

3.14.3 To increase the forest cover in the country, afforestation programme are taken up by the Government of India under various Centrally Sponsored Schemes such as National Afforestation Programme (NAP), Green India Mission (GIM), Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS), Integrated Watershed Management Programme (IWMP), which from 2015-16 has been amalgamated as the Watershed Development Component of the “Pradhan Mantri Krishi Sinchayee Yojana (PMKSY)” under Compensatory Afforestation Fund Management and Planning Authority (CAMPA).

3.14.4 Further, financial assistance is also provided for various forest protection measures under various Centrally Sponsored Schemes of this Ministry such as Integrated Development of Wildlife Habitat (IDWH), Project Tiger, Project Elephant and erstwhile Intensification of Forest Management Scheme (IFMS), which was revised and replaced as Forest Fire Prevention and Management Scheme (FPM).

3.14.5 The Committee observes that 65.34 per cent of the total geographical area of the NER is covered by forests. However, the forest cover is diminishing due to shifting cultivation and other biotic pressure which is a matter of concern for the Committee. The Committee, therefore, desires that the issue may be addressed, firstly, by providing training on sustainable agricultural practices and, secondly, by offering alternative livelihood opportunities to the people living around the forest areas. The Committee also recommends that the Government of India should intensify its various afforestation programmes in the region.

3.15 Promotion of Self Help Groups (SHGs) 3.15.1 Promotion of Self Help Groups (SHGs) in additional areas has got an impetus under North Eastern Rural Livelihood Project of the Ministry of Development of North Eastern Region. A large number of SHGs are also benefitting through credit linkages by the North Eastern Development Financial Institution (NEDFi). NEDFi’s Microfinance Scheme, an effective instrument for financial inclusion, was launched to meet the needs of smaller entrepreneurs in the remote areas of the Region. During the current FY (till 31 st January, 2018), loans sanctioned under the scheme was aggregated to Rs. 65.35 crore and disbursed was Rs. 64.30 crore. Till 31 st January, 2018, cumulative sanctions and disbursements of Rs. 655.15 crore and Rs. 635.02 crore respectively were made to NGO-MFIs/NBFCs from 8 North Eastern States. These microfinance intermediaries reached out to more than 6 lakh beneficiaries, of which around 95 per cent are women. 58

3.15.2 As regards the steps taken by the Ministry during the last two years to encourage entrepreneurship in the North-East Region (NER), the Committee was informed that Ministry of DoNER, jointly with NEDFi, has set up the North East Venture Fund (NEVF), a dedicated Venture Fund for the North Eastern Region (NER) with a corpus of Rs 100 crore. The fund is in line with the Central Government’s vision towards encouraging entrepreneurs and will focus towards empowering entrepreneurs form the North Eastern Region. In fact, the Fund is a direct outcome of the direction shown by the Prime Minister at the 65 th Plenary Session of NEC held in Shillong in May,2017.

3.15.3 The dedicated venture capital fund for the NER will be targeting to fill the much felt gap of equity faced by the entrepreneurs of the Region, especially the first generation entrepreneurs. The prime focus of the fund will be to act as a catalyst in enterprise building and spur the entrepreneurial ecosystem in the NER. The fund was formally launched on 9 th September, 2017.

3.15.4 The Committee appreciates NEDFi's Microfinance scheme in promotion of entrepreneurship, specially the women entrepreneurship in the remote areas of the NER. The Committee also hopes that the Venture Fund for the North Eastern Region with a corpus of Rs. 100.00 crore would encourage the first generation young entrepreneurs for undertaking start-ups in North Eastern Region. The Committee recommends that this should be utilised for generating more employment in the fields of information technology, food processing, health care, tourism, retail services, etc.

3.16 Inclusive Growth

3.16.1 The Committee was informed about the important initiatives taken to accelerate financial inclusion in the Region through the following schemes: Pradhan Mantri Jan Dhan Yojana (PMJDY) 3.16.2 PMJDY is a National Mission on Financial Inclusion encompassing an integrated approach to bring about comprehensive financial inclusion of all the households in the country. The plan envisages universal access to the banking facilities with at least one basic banking account for every household, financial literacy, and access to credit, insurance and pension facilities. In addition, the beneficiaries would get 'RuPay' Card having inbuilt accident insurance cover of Rs. 1.00 lakh. The plan also envisages channelling all Government benefits (from Centre/State/Local Body) to the beneficiaries’ accounts and pushing the Direct Benefits Transfer (DBT) scheme of the Union Government. The technological issues like poor connectivity, online transactions will also be addressed. Mobile transactions through telecom operators and their established centres as Cash Out Points are planned to be used for Financial Inclusion under the Scheme. An effort is being made by the Government to reach out to the youth of this country to participate in this Mission Mode Programme.

State-wise account opening Report as on 07/02/2018 Beneficiaries No. of Beneficiaries at Balance in at rural/semi- No Of Rural- RuPay S. urban/metro Total beneficiary State Name urban centre Urban Female cards issued No centre bank Beneficiaries accounts bank Beneficiaries to branches (in crore) branches beneficiaries Arunachal 1 Pradesh 1,51,388 1,00,483 1,39,458 2,51,871 75.26 1,96,379 2 Assam 96,26,424 30,54,727 73,94,672 1,26,81,151 2,915.94 1,00,35,675 3 Manipur 3,61,648 4,28,644 4,29,021 7,90,292 185.6 6,41,140 4 Meghalaya 3,49,023 66,540 2,48,293 4,15,563 200.39 2,43,554 5 Mizoram 98,751 1,66,560 53,089 2,65,311 48.51 90,002 6 Nagaland 1,01,212 1,16,355 1,15,795 2,17,567 37.32 1,74,810 7 Sikkim 65,430 23,334 45,696 88,764 28.44 68,678 8 Tripura 5,92,598 2,31,889 4,54,283 8,24,487 680.93 6,45,302 Total 1,13,46,474 41,88,532 88,80,307 1,55,35,006 4172.39 1,20,95,540 Source: PradhanMantri Jan DhanYojana (PMJDY) website.

Pradhan Mantri Mudra Yojana (PMMY) 3.16.3 The objective of Pradhan Mantri Mudra Yojana (PMMY) is to provide access to institutional finance to unfunded micro/small business units. Salient features of PMMY inter- alia include, extending institutional finance by providing loans up to Rs. 10.00 lakh for manufacturing, processing, trading, services and activities allied to agriculture, provision of Mudra card for drawal of working capital, refinance facility for Member Lending Institutions (MLIs), backing of credit guarantee on portfolio basis, etc. 3.16.4 The Committee is of the considered view that the benefits of the socio-economic growth and technological development must reach to the lowest rung of the society, to the person standing in the last row. In this direction, the Committee expects that Pradhan Mantri Jan Dhan Yojana (PMJDY) and Pradhan Mantri Mudra Yojana (PMMY) would be implemented earnestly for eradication of poverty, removal of socio-economic inequalities, extending equal opportunities and distributive justice to the downtrodden people in the North Eastern Region. It should be the prime objective of all the schemes. The Committee recommends that the Ministry of DoNER and other line Ministries/Departments, Agencies concerned with implementation of various schemes/projects must keep in mind that the benefits of infrastructural and technological projects in NER are meant for inclusive growth of the entire region.

RECOMMENDATIONS/OBSERVATIONS — AT A GLANCE

UTILISATION OF FUNDS DURING THE LAST THREE YEARS

The Committee takes strong exception to the low utilisation of allocation, i.e. 29.3 per cent in 2015-16, 28.1 per cent in 2016-17 and 42.6 per cent in 2017-18 under the Social and Infrastructure Development Fund (SIDF) in the allocations granted at BE Stage. The Committee had also expressed its anguish over the dismal utilisation under this Fund in its 202 nd Report on Demand for Grants (2017-18) of the Ministry of DoNER. In its action taken notes on the report, the Ministry had taken the plea that the poor utilisation during 2016-17 was due to non-submission of the alternative projects of bigger size by the State Governments after scrapping of the projects identified earlier that were having small envelope size. However, the Ministry had further stated that the State Governments had revisited their proposals and had resubmitted projects of higher estimated cost subsequent to which the projects were identified against the fund available and no balance fund was available to sanction any more projects under the SIDF. The Committee had noted the said reply of the Ministry with the hope that all the projects identified would be allocated funds under this scheme and would be completed on time. However, the Committee is disappointed to note that during 2017-18, the allocation under SIDF has been reduced at the RE stage. The Committee, therefore, strongly recommends that the Ministry must furnish a detailed project-wise utilisation schedule of funds under SIDF and the steps taken to improve the utilisation. (Para 2.2.2 of 210 th Report) REVENUE SECTION

The Committee expresses its displeasure that there is a shortfall of Rs. 1958.16 crore in the funds allocated to the tune of Rs. 2326.00 crore in BE 2018-19 vis-a-vis the amounts projected i.e. Rs. 4284.16 crore by the Ministry for its various schemes. The shortfall is too steep, particularly under the schemes of the NEC and North East Special Infrastructure Development Scheme and it will adversely affect infrastructure development in the North Eastern Region. The Committee, therefore, strongly recommends that the Ministry of DoNER must pursuade the Ministry of Finance to allocate a larger amount of funds for these schemes at RE stage in 2018-19. (Para 2.4.4 ibid) CAPITAL SECTION

The Committee observes that an allocation of Rs. 250.00 crore has been made under the NERSDS–Programme as against the projected amount of Rs. 500.00 crore. The Committee feels that this shortfall of 50 per cent may adversely affect the implementation of several road projects under this scheme. The Committee, therefore, recommends that the Ministry of DoNER should strive to achieve a higher utilisation in the first half of 2018- 19 and pursue the Ministry of Finance to enhance allocation at RE stage in 2018-19.

(Para 2.5.5 ibid) SECRETARIAT

The Committee emphasizes that all instructions issued by the Ministry of Finance from time to time on economizing and rationalizing of expenditure should be scrupulously followed by the Ministry of DoNER.

(Para 2.6.4 ibid)

SCHEMES OF NEC

The Committee appreciates the role of the NEC in formulation of regional plans for integrated and balanced socio-economic development of the NER. The Committee also takes note of the efforts made by the NEC in addressing the issue of non-receipt of utilisation certificate and the decreased demand for projects under the Major Head 2552 and taking appropriate steps by re-appropriating the amount of Rs. 108.20 crore from Major Head 2552 to ongoing projects under Major Head 3601. However, the Committee desires that the NEC and the Ministry of DoNER must take necessary steps to enhance the absorption capacity of projects under Major Head 2552 so that the allocated funds are fully utilised in such projects. The Committee also hopes that after the special drive in the form of UC clearance fortnight, there would not be any pendency in the receipt of Utilisation Certificates.

(Para 2.8.11 ibid)

SPECIAL DEVELOPMENT PROJECTS

The Committee observes that the NEC intends to incur expenditure to the tune of Rs. 260.00 crore (as against the total allocation of Rs. 697.53 crore in RE 2017-18 under Major Head 3601 i.e. Special Development Projects. The actual expenditure till 31 st January, 2018 is Rs. 437.00 crore) in the last month of the current financial year whereas, the fiscal rules indicate that the guillotine would apply in case the NEC spends more than 33 per cent of the allocated money in the last quarter. The Committee wonders as to how the NEC would spend Rs. 260.00 crore which is more than one third of the total expenditure in the last month. The Committee feels that since, in the last month, the NEC cannot spend more than 15 per cent of allocated money, it will result in a huge unspent sum and consequent drastic reduction of allocation to the tune of Rs. 505.00 crore in Major Head 3601 in BE 2018-19.

(Para 2.9.5 ibid)

The Committee takes note of the submission of the Secretary, NEC that the moment the NEC transfers the money to the CPWD, it would be assumed that it has been spent. The Committee finds this response of the NEC to be very unsatisfactory. The Committee observes that if the NEC transfers the money in the month of February or March, the CPWD will find it difficult to spend and most probably it will lapse, which is highly objectionable. The Committee also observes that simply transferring the funds does not mean that it would be spent by the end of the Financial Year for the intended purpose and recommends that this distinction should be clearly defined and taken into account in future projects.

(Para 2.9.7 ibid)

The Committee feels that the Government should make a one-time provision for the NEC towards meeting the committed liability to the tune of Rs. 1403.86 crore so that the NEC can start implementation of the projects without the burden of a large committed liability.

(Para 2.9.9 ibid)

CENTRAL POOL OF RESOURCES FOR NORTH EAST AND SIKKIM

The Committee expresses its concern over the reduction in allocation under the capital head to Rs. 175.00 crore at RE stage in 2017-18 against Rs. 369.00 crore allocated in BE 2017-18. Though the actual expenditure was Rs. 190.00 crore in 2016-17. The Committee takes note of the plea that the Ministry of Railways could absorb the fund to the tune of Rs. 57.63 crore only against the allocation of Rs. 260.00 crore on Akhaura- Agartala Rail link project as approved by the Central Monitoring Committee (CMC) in BE 2017-18 on account of delay in handing over land, exceptionally high rain fall during the year and delay in shifting of electrical utilities by the State Government. However, the Committee has been assured that the Akhaura-Agartala Rail Link project would be completed without time and cost overruns. The Committee hopes that the project would receive the highest priority and be completed without time and cost overruns.

(Para 2.10.8 ibid)

NORTH EAST SPECIAL INFRASTRUCTURE DEVELOPMENT SCHEME (NESIDS)

The Committee takes note of the revision in the NLCPR Guidelines, measures initiated to ensure speedy implementation viz. , just-in-time release of funds by which an initial token amount of Rs. 10.00 lakh is released for tendering of works and balance amount of first installment is released only after receipt of letter of award of the contract; number of installments reduced to two as against the earlier practice of three installments; maximum expenditure of outlay against ongoing projects; online submission of requisite documents, which shortened processing period; regular review meetings and campaigning in the States to expedite timely completion of projects. The Committee appreciates the measures taken by the Ministry of DoNER and recommends that all projects undertaken under NLCPR and projects undertaken by the NEC should be completed within the stipulated time frame. (Para 2.11.10 ibid)

The Committee has been given to understand that the NESIDS is a Central Sector Scheme with financial outlay of Rs. 1600.00 crore for a period of three years commencing from 2017-18 where no allocation has been made for the first year i.e. 2017-18 and for the second financial year i.e. 2018-19, a sum of Rs. 180.00 crore has been earmarked, leaving a huge amount of Rs. 1420.00 crore for the third year i.e. 2019-20. The Committee is seriously doubtful as how the scheme, being approved on 15 th December, 2017 with total approved cost of Rs. 1600.00 crore to be implemented during a period of three years with no allocation made for the first year of scheme i.e. 2017-18 and for the second financial year i.e. 2018-19, a total allocation made is to the tune of Rs. 180.00 crore only and thus leaving a huge amount of Rs. 1420.00 crore for the last year of scheme i.e. 2019-20. The Committee, keeping in mind the work and efficiency of implementing agencies of schemes under prevailing geographical scenario and climatic conditions in NER and also the absorption-capacity, has serious apprehensions that the amount left for third year of scheme would be optimally utilised during the year 2019-20. Therefore, the whole purpose of the scheme may lose its momentum, pushing the scheme to suffer from improper planning and imprudent expenditure. The Committee, therefore, calls upon the Government to relook the fund allocation under the scheme during the RE 2018-19 and ensure that the projects undertaken under NESIDS are not derailed.

(Para 2.11.11 ibid)

CONSULTANCY, MONITORING, EVALUATION

The Committee notes that under revised NLCPR guidelines the work of vetting of DPR of projects has been delegated to State Governments, therefore, the revenue outlay under Consultancy, Monitoring, Evaluation - charges under NLCPR scheme has been reduced from Rs. 5.00 crore in BE 2017-18 to Rs. 2.00 crore in RE 2017-18 and BE 2018- 19, as the provision was mainly for payment towards vetting of Detailed Project Reports through Public Sector Undertakings. The Committee hopes that the revised NLCPR guidelines would work successfully and sincere efforts would be made in this direction to ensure the efficiency of the new guidelines.

(Para 2.12.3 ibid)

NER LIVELIHOOD (EAP) PROJECT (NERLP)

The Committee feels that the major impediment in the implementation of NERLP is the absence of institutionalised credit to SHGs. The Committee, therefore, strongly recommends that steps be taken for improving the bank linkage of the SHGs. Concerted efforts such as signing of MOUs with banks, provision of Bank Mitras and appointment of Banking Correspondents for serving in the areas not covered by banking services must be made. The Committee hopes that the projects undertaken under the NERLP would prove effective in increasing employment opportunities, improving rural livelihoods, etc. in selected identified districts of Mizoram, Nagaland, Sikkim and Tripura.

(Para 2.14.8 ibid)

NORTH EAST ROAD SECTOR DEVELOPMENT SCHEME (EAP COMPONENT)

The Committee observes that under the North East Road Sector Development Scheme (NERSDS), there are two components viz. Programme Components and EAP. The Programme components contain three road projects being implemented by the NHIDCL that is to be completed by September, 2018. Besides, 15 more road projects and two bridge projects are at preparation of DPR stage. While under EAP, there are two phases i.e. Tranche-I and Tranche-II under NESRIP that have been undertaken with estimated cost of Rs. 497.13 crore and are to be completed by June, 2019 and at the estimated cost of Rs. 856.70 crore to be completed by March, 2020, respectively. The Committee, keeping in view the closure of all projects by March, 2020, strongly recommends that every effort must be made to execute the projects undertaken without any time and cost overruns.

(Para 2.18.4 ibid)

The Committee is constrained to express its deep displeasure that under the programme component of the North East Road Sector Development Scheme, no fund has been utilised because all the projects are pending at the stage of preparation of DPR. The Committee finds that the procedural delay in approval of the projects arises due to the requirement of third party evaluation and also because the Ministry held the EFC meeting as late as i.e. in the month of December, 2017. The Committee was given to understand that the funds can be allocated and utilised only after the approval of the projects. The Ministry assumed that the funds would be utilised by transferring the amount to the implementing agencies viz. CPWD and BBJ during 2017-18 and 2018-19. The Committee finds the implementation of the programme will be unsatisfactory unless the projects are approved on time. The Committee finds it difficult to understand that the Ministry expects to implement the Programme Component merely by transferring the funds when 64 the projects have not been even granted approval by the Ministry. The Committee, therefore, strongly recommends that the preparation of DPR of seven roads and two bridges in Sikkim by the BBJ and preparation of DPR of eight roads by the CPWD must be expedited so that all the projects under the programme component of the NERSDS are approved in time, funds are allocated/released and all the projects are implemented within a specified timeframe without any cost overrun.

(Para 2.18.5 ibid)

BODOLAND TERRITORIAL COUNCIL (BTC)

The Committee understands that the efficient working of BTC would lead to socio- economic infrastructure development like road & bridges, power, agriculture, art and culture. The Committee takes note of the submission of the Secretary, DoNER that there is no money left in BTC package. The Committee finds the performance of the BTC satisfactory.

(Para 2.19.6 ibid)

KARBI ANGLONG AUTONOMOUS TERRITORIAL COUNCIL (KAATC)

The Committee observes that Karbi Anglong Autonomous Territorial Council (KAATC) is not able to absorb the allocated fund. The Committee expresses its concern that though Karbi Anglong had an allocation of Rs. 40.00 crore in BE 2017-18 and the Rs. 40.00 crore has been retained at RE stage, the Secretary submitted before the Committee that KAATC could spend only Rs. 1.5 crore in the financial year 2017-18. The actual expenditure in 2016-17 was Rs. 3.44 crore against allocation of Rs. 30.00 crore in BE 2016- 17. The Committee, therefore, recommends that the Ministry of DoNER in association with the State Government of Assam must remove the procedural delays in preparation of DPRs and expedite approval of the projects so that these could not only be undertaken for implementation but are also completed without further delay.

(Para 2.20.5 ibid)

DIMA HASAO AUTONOMOUS TERRITORIAL COUNCIL (DHATC)

The Committee is dismayed with the working of the Dima Hasao Territorial Council as the Council is not able to absorb the allocated fund for developmental activities. As per the provision of memorandum of settlement, the Government of India agreed to provide a special package of Rs. 200.00 crore (Rs. 40.00 crore per annum) over and above the Plan fund, but Dima Hasao Council could spend Rs. 23.37 only against the allocation of Rs. 40.00 crore. The Secretary, Ministry of DoNER submitted before the Committee that the allocated funds are available to the Council but the Council is not able to spend the allocated fund on the developmental activities. The Committee, therefore, strongly recommends that M/o DoNER must take a lead in coordinating with the State Government of Assam for formulating infrastructure projects so that all proposals of DHATC are submitted in time for final approval. The Committee further recommends that the Ministry must have appropriate monitoring mechanism in place to ensure speedy execution of projects undertaken without any time and cost overrun.

(Para 2.21.6 ibid)

The Committee is constrained to express its deep displeasure over the dismal performance of Dima Hasao Territorial Council (DHTC) and Karbi Anglong Autonomous Territorial Council (KAATC) due to low absorption capacity of these autonomous territorial councils. The Committee finds that there are serious procedural lacunae in the functioning mechanism of both the Councils, which were created to give autonomy to the tribals for their upliftment, but unfortunately, the councils are not able to absorb the allocated amount on development activities. The Committee fails to understand the reason. When Bodoland Territorial Council (BTC) can absorb all its allocated funds within the stipulated time, what holds up the other territorial councils to follow the footsteps of BTC? The Committee is of the opinion that there seems to be no mechanism in place to expedite the development process by preparing schemes, taking their approval and executing them in a time bound manner. The Committee, therefore, strongly recommends that there remains an urgent need to put in place a robust co-ordination mechanism to expedite the development process so that desired results could be achieved.

(Para 2.21.10 ibid)

SOCIAL AND INFRASTRUCTURE DEVELOPMENT FUND (SIDF)

The Committee was given to understand that a provision of Rs. 586.20 crore was made under the Social and Infrastructure Development Fund (SIDF) for undertaking infrastructure projects in the NER in Arunachal Pradesh and other border areas which could not be covered through normal schemes. The Committee hopes that all the projects under the scheme will be completed within the stipulated timeframe and estimated cost. The Committee also believes that the concerted efforts need to be made by the Ministry of DoNER to accelerate the utilisation of funds under the SIDF.

(Para 2.22.6 ibid)

NORTH EAST DEVELOPMENT FINANCE CORPORATION (NEDFI)

The Committee appreciates the performance of the North East Development Finance Corporation (NEDFi) for promotion of MSME and micro finance sector which, no doubt, contribute towards more inclusive and equitable growth in the NER. The Committee, therefore, recommends that the annual allocation to NEDFi may be enhanced in order to boost the pace of Corporation’s efforts in mirco financing and promoting other developmental activities. The Committee reiterates its recommendation made in the 202 nd Report on Demands for Grants (2017-18) of the Ministry of DoNER that NEDFi must play the role of the key driver of equitable economic development and inclusive growth by boosting the pace of entrepreneurship development, setting up of Business Facilitation Centres and undertaking other developmental and promotional activities.

(Para 2.23.8 ibid)

NORTH EAST REGIONAL AGRICULTURAL MARKETING CORPORATION (NERAMAC)

The Committee takes into account the efforts undertaken by the Ministry in coordination with the NERAMAC management through infusion of capital and enhancing the commercial activities of the NERAMAC by promoting organic produces, Agro-Horti produce and organising and participating in various events, exhibitions, buyer-seller meet etc. The Committee, however, expresses a serious concern over the poor financial position of the NERAMAC and insufficient intermediary steps undertaken by the Government to 66 improve its financial viability. The Committee fails to understand as to how a corporation with negative networth is mandated to implement its core activities viz. creation of a world class infrastructure for processing, value addition and marketing of agricultural allied goods in the NER. The procedural delay in sanctioning amount of Rs. 7.11 crore as working capital to carry out its business activities as a part of Rs. 20.86 crore, as one time fund requirement, mars the prospects of the revival of the Corporation. The Committee, therefore, strongly recommends that the Government must consider and implement the revival package for the NERAMAC without further delay, as sooner the revival package for the NERAMAC is implemented better it would be not only for the Corporation but also for the entire agricultural allied sector in the NER.

(Para 2.24.11 ibid)

NORTH EASTERN HANDICRAFTS AND HANDLOOMS DEVELOPMENT CORPORATION LIMITED (NEHHDC)

The Committee was given to understand that the North Eastern Handicrafts and Handlooms Development Corporation Limited (NEHHDC) has been successful in reducing the losses over the years and is expected to break even by the end of 31 st March, 2018. The Committee hopes that things turn out as expected and the NEHHDC after breaking even in March 2018 will start earning profit thereafter.

(Para 2.25.8 ibid)

VISION 2020

The Committee takes note of the thrust areas of Vision 2020 Document which inter- alia includes inclusive growth, poverty eradication, rural sector, infrastructure, human resource development, banking, industries and tourism. As the year 2020 is approaching, the Committee feels that progress of the projects, undertaken under Vision 2020 Document, should be reviewed by Ministry of DoNER along with the Ministries concerned to assess the current status vis-a-vis the set targets and make requisite policy modification/intervention to ensure their completion within the stipulated time frame to achieve the objectives of mission of Vision 2020.

(Para 3.1.6 ibid)

STATUS OF MAJOR ROADS

The committee observes that the construction on the various sections such as Melli- Manpur-Namchi, Tarku-Damthang-Namchi and Nayabazaar-Legship had begun way back in 2013. Even after the passage of nearly 5 years, none of the stretches is near the completion stage. These are major roads that provide connectivity in the South and West Sikkim Districts and are important for both the local population and incoming tourists. The Nayabazar-Legship road, having a length of mere 24 km., has seen a physical progress of just 41 per cent in a span of nearly 5 years. The cumulative physical progress with regard to construction of two lane roads from Tarku-Damthang-Mamchi and Melli- Manpur-Namchi in South Sikkim is 38 per cent and 46 per cent, respectively. The Committee is of the view that progress achieved in half a decade is not at all satisfactory. Though hilly terrain and weather conditions create adverse conditions for completion of these road projects, it may be noted that these projects are going on since 2013. The Committee, therefore, strongly recommends that the Ministry must urgently conduct an audit of construction activities of these roads and must seek explanation from the Sikkim 67

PWD for the extremely snail-pace of the works pertaining to these roads. The Committee also recommends that accountability may be fixed/enforced for this non-performance and remedial measures should be taken urgently to expedite the completion of these Roads. The Committee desires to be apprised of the action taken in this regard. (Para 3.6.3 ibid)

The Committee takes note of the progress of the 4-laning of Dimapur–Kohima road in its different sections and observes that the progress is not satisfactory at all. This project was to be completed in 36 months, yet, on two of the three sections; the physical progress is of just 26.63 per cent and 9.67 per cent after more than 18 months i.e. 50 per cent of the completion period. The Committee apprehends that, at this pace, the project will not be completed by its scheduled date of completion unless the Ministry redoubles its efforts and tries its best to expedite the construction work. (Para 3.6.6 ibid)

The Committee takes note of the submission of the Ministry that works for this 60 km. long road was awarded at a cost of Rs. 154.01 crore in September, 2017 with a completion deadline of one year. However, the Committee observes that the Ministry has not intimated the Committee whether or not the construction work has begun. The Committee, therefore, strongly recommends that the Ministry of DoNER must send a team to assess the status of construction of the Wokha–Merapani road and find out whether the construction is going on as per the schedule in accordance with the set construction guidelines or not and the Committee may be apprised of the action taken in this regard.

(Para 3.6.10 ibid)

The Committee takes note of the submission of the Ministry that the renovation of the Agia-Medhipara-Phulbari-Tura (AMPT) Road was completed during 2016-17 and it is presently being maintained by the State Governments concerned. However, the Committee is anguished to observe that a road that was renovated recently at a cost of Rs. 90.64 crore started deteriorating within a few days of its completion. The Committee feels that this raises a serious question over the quality of materials used in the construction and the monitoring mechanism related thereto. The Committee, therefore, strongly recommends that the Ministry must urgently conduct an audit of the road and enquire into the quality of materials used in the construction. The Committee may be apprised of the action taken in this regard.

(Para 3.6.14 ibid) CIVIL AVIATION

The Committee takes into account both the long term and short term strategies and notes that several smaller projects i.e. six in Assam, two each in Tripura and Arunachal Pradesh and Meghalaya and one each in Manipur, Nagaland and Sikkim have been undertaken for up-gradation and modification/expansion which are at various stages of completion. The Committee understands that completion of these projects would smoothen the air connectivity and operational efficacy of Civil Aviation in NER. The Committee, therefore, strongly recommends that these smaller projects be completed in the stipulated time frame and without cost overruns. The Committee further recommends that the Ministry of DoNER must co-ordinate with implementing agencies and the line Ministries concerned for ensuring the speedy execution of undertaken projects at the specified pace.

(Para 3.7.16 ibid)

TELECOM SECTOR

The Committee takes note of the Comprehensive Telecom Development Project for the NER at an estimated cost of Rs 5336.00 crore to be funded from Universal Services Obligation Fund (USOF) and expects that the telecommunications network would cover State Capitals, District Headquarters and villages. The Committee hopes that the broadband connectivity at gram panchayat level would be covered by ‘Bharat Net’ within the set timeframe.

(Para 3.8.3 ibid)

FLOOD CONTROL PROJECTS

The Committee notes that 174 projects were sanctioned under the NLCPR Scheme in the flood control and irrigation sector out of which 162 have been completed and the remaining 12 are proposed to be completed by March 2020. The Committee also notes that out of the 37 flood control projects, sanctioned under the NEC Scheme, several projects are pending. In respect of some projects, particularly in Nagaland and Manipur, the NEC has not released a major chunk of its share of funds. The Committee is aware that every year flood causes havoc and timely implementation of all flood control projects is critical to the development of North Eastern Region. The Committee, therefore, recommends that the Ministry should ensure timely completion of all pending flood control projects in the North Eastern Region.

(Para 3.9.2 ibid)

KALADAN MULTIMODAL TRANSIT TRANSPORT (KMTT) PROJECT

The Committee takes note of the progress of the Kaladan Multimodal Transit Transport (KMTT) project that is being piloted and funded by the Ministry of External Affairs. The Committee is aware that this project was expected to be operationalised by December, 2016. However, till date, no component of the project has been completely operationalised and the road component has been languishing for a long time. This indicates a failure of monitoring and supervision. The Committee understands that this project is an integral part of the Act East Policy of India and is of strategic importance. The Committee, therefore, recommends that the Ministry of External Affairs should take ownership and responsibility for the project and that all the components of the Kaladan Multimodal Transit Transport project should be completed at the earliest to resolve the connectivity woes of the North Eastern Region.

(Para 3.10.2 ibid)

TOURISM

The Committee takes note of the implementation status of various projects under Swadesh Darshan and PRASAD Schemes of the Ministry of Tourism that aim to develop theme-based tourist circuits, and create improved amenities and necessary infrastructure for promotion of tourism in the States of North Eastern Region. However, the Committee finds that an amount of only Rs. 686.19 crore have been released during 2014-15, 2015-16 and 2016-2017 on various projects under Swadesh Darshan Scheme, as against the sanctioned amount of Rs. 1267.49 crore, which is matter of serious concern. The

Committee, therefore, recommends that the Government must ensure a release of the sanctioned amount for timely implementation of the undertaken projects.

(Para 3.11.11 ibid)

The Committee also takes note of the projects related to tourism promotion that are being implemented under the NLCPR and NEC Schemes and hopes that concerted efforts would be made to implement these projects for developing niche and high end tourism in the NER.

(Para 3.11.12 ibid)

The Committee also desires that the Ministry of Tourism should harness the potential of the NER for promoting river cruises and promote identified pilgrimage tourism circuit on National Waterway-2 (Brahmaputra River). The Committee hopes that the decision of the Ministry of Tourism to open a new centre/institutes of Indian Institute of Tourism and Travel Management (IITTM) with an aim to make education more accessible and providing qualified Human Resource for Tourism and Allied services for North Eastern Region States, would lead to desirable outcomes.

(Para 3.11.13 ibid)

The Committee recommends that the construction/renovation work of Mahabali Temple in Imphal East sanctioned since 2013-14, must be completed at the earliest.

(Para 3.11.14 ibid)

The Committee observes that the amount allocated for the purpose of protecting Majuli Islands from erosion is not adequate and recommends that the amount must be increased at RE stage.

(Para 3.11.15 ibid)

NORTH EASTERN INDUSTRIAL AND INVESTMENT PROMOTION POLICY (NEIIPP)

The Committee observes that North East Industrial & Investment Promotion Policy (NEIIPP), 2007 has come to an end on 31 st March, 2017 and a new industrial policy for the North Eastern and Himalayan States is under consideration of the Government. Therefore, the Committee desires that the Government should not delay in approving the new industrial development scheme for the North Eastern Region. The Committee also desires that the Ministry of Micro, Small and Medium Enterprises (MSME) should popularize promotion of MSMEs in NER for more employment and specific steps taken in this regard may be intimated to this Committee.

(Para 3.12.8 ibid)

AGRICULTURE AND FOOD PROCESSING SECTOR

The Committee takes note of the scheme called Mission Organic Value Chain Development for North Eastern Region implemented by the Ministry of Agriculture and Farmers Welfare for providing cluster development. The Committee hopes that the undertaken scheme would promote integrated agriculture and food processing units in NER. However, the Committee expresses its concern that an amount of only Rs. 4762.65 70 lakh was released against the budget allocation of Rs. 8825.00 lakh in the year 2016-17 and an amount of just Rs. 3400.00 lakh was released against the budget allocation of Rs. 9025.00 lakh during the year 2017-18. The Committee also observes that the budgetary allocations under this scheme have not been optimally utilised. The Committee, therefore, recommends that the fund utilisation should be improved under this scheme and all the bottlenecks that prevent optimal utilisation of the funds may be resolved at the earliest.

(Para 3.13.3 ibid)

ENVIRONMENT AND FORESTS

The Committee observes that 65.34 per cent of the total geographical area of the NER is covered by forests. However, the forest cover is diminishing due to shifting cultivation and other biotic pressure which is a matter of concern for the Committee. The Committee, therefore, desires that the issue may be addressed, firstly, by providing training on sustainable agricultural practices and, secondly, by offering alternative livelihood opportunities to the people living around the forest areas. The Committee also recommends that the Government of India should intensify its various afforestation programmes in the region.

(Para 3.14.5 ibid)

PROMOTION OF SELF HELP GROUPS (SHGS)

The Committee appreciates NEDFi's Microfinance scheme in promotion of entrepreneurship, specially the women entrepreneurship in the remote areas of the NER. The Committee also hopes that the Venture Fund for the North Eastern Region with a corpus of Rs. 100.00 crore would encourage the first generation young entrepreneurs for undertaking start-ups in North Eastern Region. The Committee recommends that this should be utilised for generating more employment in the fields of information technology, food processing, health care, tourism, retail services, etc.

(Para 3.15.4 ibid)

INCLUSIVE GROWTH

The Committee is of the considered view that the benefits of the socio-economic growth and technological development must reach to the lowest rung of the society, to the person standing in the last row. In this direction, the Committee expects that Pradhan Mantri Jan Dhan Yojana (PMJDY) and Pradhan Mantri Mudra Yojana (PMMY) would be implemented earnestly for eradication of poverty, removal of socio-economic inequalities, extending equal opportunities and distributive justice to the downtrodden people in the North Eastern Region. It should be the prime objective of all the schemes. The Committee recommends that the Ministry of DoNER and other line Ministries/Departments, Agencies concerned with implementation of various schemes/projects must keep in mind that the benefits of infrastructural and technological projects in NER are meant for inclusive growth of the entire region.

(Para 3.16.4 ibid)

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