CAG reports on financial irregularities in Indian states

The Comptroller and Auditor General (CAG) of India has identified significant financial irregularities and fiscal challenges in the states of Meghalaya and Mizoram.

In Meghalaya, audits revealed that Rs 815.14 crore was spent during 2024-25 without legal authority or budget provisions, with the majority of these funds used for public debt administration. Subsequent reports indicated that Meghalaya’s total liabilities reached Rs 26,601 crore as of March 31, 2025, an increase of Rs 5,081 crore from the previous year. This debt represents 44.61 per cent of the state’s GSDP, exceeding the target of 37.91 per cent. The concentration of repayments due within seven years has raised concerns regarding liquidity and rollover risks. The Leader of the Opposition, Dr. Mukul Sangma, warned of a potential debt trap and alleged that some project costs, such as a water supply scheme valued at approximately Rs 850 crore, have been “highly inflated.”

In Mizoram, the CAG flagged the suspected misappropriation of Rs 9.19 crore from the Green India Mission in the Kolasib district. The audit found that funds intended for 12 Village Forest Development Committees were withdrawn in cash by the Forest Development Agency in March 2023, with no documentary evidence that the money was transferred to the committees.