Cost overrun of Rs 1.77 trillion due to 273 infra projects

As many as 273 infrastructure projects, which include those delayed due to land acquisition, forest clearances and other reasons, have led to a cost overrun of Rs 1.77 lakh crore, as per data from the Ministry of Statistics and Programme Implementation. In August this year, the ministry had monitored 1,167 infrastructure projects, each worth Rs 150 crore or more across sectors such as power, railways and roads. As per its flash report, out of the 1,167 projects, 282 are on schedule, 337 are delayed, 273 projects reported cost overrun and 85 projects reported both time and cost overrun with respect to their original project implementation schedules. The report stated that the total original cost of implementation of the 1,167 projects was Rs 1,433,476.53 crore and their anticipated completion cost is likely to be Rs 1,610,504.54 crore, which reflects overall cost overrun of Rs 177,028.01 crore (12.35 per cent of the original cost). Expenditure incurred on these projects till August 2016 is Rs 630,581.41 crore, which is 39.15 per cent of the anticipated cost of the projects, according to the report, which however states that the number of delayed projects decreases to 283 if delay is calculated on the basis of latest schedule of completion. Moreover, the report also mentions that 81 projects have been sanctioned without original commissioning date, and for 460 projects neither the year of commissioning nor the tentative gestation period has been reported. Out of 337 delayed projects, 68 projects have overall delay in the range of one to 12 months, 54 projects have delay in the range of 13 to 24 months, 138 projects have delay in the range of 25 to 60 months and 77 projects have delay of 61 months and above. Furher, in comparison to a report April 2016, the number of projects reporting cost overruns has increased from 22.71 per cent to 23.39 per cent whereas projects reporting time overruns have decreased from 30.73 per cent to 28.88 per cent (in August 2016). The report highlights reasons for time overruns as reported by various project implementing agencies being delays in land acquisition, forest clearance and supply of equipment. Other factors for delays include fund constraints, geological surprises, problems in equipment erection, geo-mining conditions, slow progress in civil works, shortage of labour, inadequate mobilisation by contractor, Maoist problems, court cases, contractual issues, ROU or ROW problems, law and order situation etc.