Published: 27 November 2025CAG/PSU ConnectEconomy
CAG Report No. 35: NLC India ₹2,354 Crore Loss, Safety Lapses
The Comptroller and Auditor General of India (CAG) released Report No. 35, a comprehensive performance audit of NLC India Limited (formerly Neyveli Lignite Corporation), a Navratna Central Public Sector Undertaking (CPSU) under the Ministry of Coal. The report exposes significant financial losses, operational inefficiencies, and serious safety failures across NLC India's thermal power stations and mining operations.
The CAG audit found that design flaws in thermal power stations resulted in a cumulative loss of ₹2,354 crore to the public exchequer. These losses stem from engineering and planning deficiencies that could have been avoided with adequate oversight and quality assurance mechanisms during the design and commissioning phases of projects.
A major land management failure is also documented: approximately 580 hectares of land, which rightfully belong to NLC India, are out of its possession. This includes land encroached upon or under dispute, representing a significant loss of public assets that should have been protected and utilised for the PSU's operational expansion.
The most alarming finding relates to fire incidents at NLC India's coal handling and power facilities between 2018 and 2020. These fires resulted in the tragic deaths of 20 workers, pointing to systematic lapses in occupational health and safety protocols, fire safety infrastructure, and emergency response preparedness. The CAG report calls for immediate corrective action to prevent recurrence.
The report underscores the broader accountability challenge facing India's PSU sector. NLC India, which operates critical energy infrastructure including lignite mines in Tamil Nadu and thermal power stations in multiple states, is a strategically important entity. The CAG findings call for urgent reforms in project planning, asset management, worker safety, and governance standards at the PSU.
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Frequently asked questions
What is CAG Report No. 35 about?
CAG Report No. 35 is a performance audit of NLC India Limited (formerly Neyveli Lignite Corporation), a Navratna CPSU, examining its thermal power stations and mining operations. It found ₹2,354 crore in losses due to design flaws, 580 ha of land out of possession, and 20 worker deaths in fire incidents.
What caused the ₹2,354 crore loss at NLC India?
The loss was caused by design flaws in NLC India's thermal power stations. These engineering and planning deficiencies, which could have been avoided with adequate oversight, resulted in significant financial losses to the public exchequer.
What are the safety concerns highlighted in the CAG report on NLC India?
The CAG report highlights fire incidents between 2018 and 2020 at NLC India's coal handling and power facilities that killed 20 workers. It points to systematic lapses in occupational health, fire safety infrastructure, and emergency response preparedness.
What is NLC India and under which ministry does it function?
NLC India Limited (formerly Neyveli Lignite Corporation) is a Navratna Central Public Sector Undertaking (CPSU) under the Ministry of Coal. It operates lignite mines in Tamil Nadu and thermal power stations across multiple states, making it a critical energy infrastructure entity.
What is the role of the CAG in India's accountability framework?
The Comptroller and Auditor General (CAG) of India is a constitutional authority under Article 148 that audits the accounts of the Union and State governments, PSUs, and government-funded bodies. CAG reports are laid before Parliament and State Legislatures, ensuring financial accountability and transparency.
