Manipur Assembly Speaker Yumnam Khemchand on Thursday alleged that Rs 10 crore meant for opening a mechanised pottery unit had been swindled.
He made the allegation while visiting some pottery units at Nungbi in Ukhrul district.
"The fund was released by the North Eastern Council. It was meant for opening a mechanised unit at Nungbi to benefit hundreds of potters. But the huge amount vanished into thin air. The money was sanctioned two years ago," Khemchand said.
He said the central government was aware of the misappropriation and an inquiry would soon be initiated.
Potteries made in Ukhrul district are in high demand.
"The mechanised unit would have gone a long way in making it more popular throughout the world," the Speaker added.
Manipur Chief Minister N. Biren Singh, who has been promising to stamp out corruption, said the government had recently stumbled on this scam.
"The government shall conduct an inquiry and the guilty shall be pulled up. It is an insult to the tribal potters," Singh added.
He said the government was paying attention to other central funds which may have been swindled.
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