'DNA' investigations: Nabard wastes Rs22 crore, govt ignorant

The National Bank for Agriculture and Rural Development’s (Nabard) management led by Dr Prakash Bakshi wasted several crores of public money on wrongful policies and personal benefits. DNA in May 2012 had reported that rules were violated to appoint Dr Bakshi as Nabard chairperson.

The restructuring of Nabard was initiated on the basis of a plan drawn up by the Boston Consulting Group (BCG), a global management consulting firm. The BCG was appointed to guide Nabard in the 18-month restructuring process to improve the bank’s operations. The process began in 2010 and ended in December 2011.

A Right to information Act (RTI) query in June 2012 revealed that the BCG was given Rs13.2 crore for the process, but the  company did not produce any report. In fact, DNA found that Rs13 crore was the initial amount and an additional Rs9 crore was given to BCG later. Dr Bakshi was primarily instrumental in getting the BCG involved.

“In exchange of Rs22 crore, Nabard did not get anything. The consultants should come out with reports that become the framework of restructuring,” said Dr KG Karmakar, former managing director of Nabard. He had opposed the selection of BCG when he was at the helm of affairs.

Several Member of Parliaments (MPs) cutting across party lines had written to the finance minister against taking the BCG’s help, but the management was adamant. “Part of the money has been pocketed by the NABARD management and that is why they were so adamant,” said a senior official from NABARD, requesting anonymity.

When Dr Bakshi applied for the chairperson’s post in December 2010, he had just over two years experience in the top management position as against the mandatory three years.

Once appointed chairperson, Dr Bakshi, who was entitled to NABARD flats in Bandra-Kurla Complex and Krishi Vikas Sadan, Dadar quarters, (which are in very good condition), chose not to stay there. Instead, he combined two official flats in Santa Cruz and spent almost Rs23.5 lakh on renovation, revealed NABARD office note sheets accessed by DNA.

“The two chairperson-designate flats are lying vacant and the PSUs have lost Rs23.5 lakh for no purpose,”said Karmakar. All previous chairpersons stayed in the flats designated to them.
Curiously, when information on the Santa Cruz flats was sought under RTI, the management gave an incorrect reply. It said that no enlargement took place. However, normal civil and electrical works have taken place from time to time. “The management is lying even under RTI. It is a shame,” added Karmakar.

As per circular, the bank cannot spend more than Rs3 lakh on furnishing the chairperson’s flat. In case of Dr Bakshi’s flat, the amount went up drastically because of costly furniture and expensive lights which were used. The BMC guidelines mention there cannot be a garden on the terrace due to fire safety norms, but the NABARD chairperson does not appear to be bothered.