As many as 428 infra projects hit cost overruns of Rs 4.98 lakh cr
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As many as 428 infra projects hit cost overruns of Rs 4.98 lakh cr

As per a report, 428 infrastructure projects, each entailing an investment of Rs 150 crore or above, have been hit by cost overruns of more than Rs 4.98 lakh crore.

According to the Ministry of Statistics and Programme Implementation, which monitors infrastructure projects of Rs 150 crore and more, out of 1,559 projects, 428 projects declared cost overruns, and around 647 projects were delayed.

The ministry's latest report for April 2022 said the total original cost of execution of the 1559 projects was Rs 21,73,907.11 crore, and their expected completion cost is likely to be Rs 26,72,201.26 crore, which reflects overall cost overruns of Rs 4,98,294.15 crore.

The expenditure incurred on these infrastructure projects till April 2022 was Rs 13,50,610.98 crore, which was 50.54% of their expected cost, according to the report.

However, the number of delayed projects drops to 525 if the delay is calculated based on the latest plan of completion.

Further, for 619 projects neither the commissioning year nor the tentative gestation period has been declared.

Out of the 647 delayed projects, 103 have overall delays in the range of 1-12 months, 111 have been stalled for 13-24 months, 314 projects for 25-60 months, and 119 projects have been stalled for 61 months and more.

The average time overrun in these 647 stalled projects was 42.83 months.

Reasons for time overruns as informed by various project executing agencies include delay in land acquisition, delay in acquiring forest and environment approvals, delay in finalisation of detailed engineering, lack of infrastructure support and linkages, ordering and equipment supply, delay in tie-up for project financing, change in scope, delay in tendering, and law and order problems.

The report also mentioned state-wise lockdowns due to Covid-19 as a cause for the delay in execution of these projects.

It has also been observed that project companies are not informing revised cost estimates and commissioning plans for many projects, which indicates that time and cost overrun figures are under-reported.

Image Source

Also read: Around 425 infra projects note cost overruns worth Rs 4.83 lakh cr

As per a report, 428 infrastructure projects, each entailing an investment of Rs 150 crore or above, have been hit by cost overruns of more than Rs 4.98 lakh crore. According to the Ministry of Statistics and Programme Implementation, which monitors infrastructure projects of Rs 150 crore and more, out of 1,559 projects, 428 projects declared cost overruns, and around 647 projects were delayed. The ministry's latest report for April 2022 said the total original cost of execution of the 1559 projects was Rs 21,73,907.11 crore, and their expected completion cost is likely to be Rs 26,72,201.26 crore, which reflects overall cost overruns of Rs 4,98,294.15 crore. The expenditure incurred on these infrastructure projects till April 2022 was Rs 13,50,610.98 crore, which was 50.54% of their expected cost, according to the report. However, the number of delayed projects drops to 525 if the delay is calculated based on the latest plan of completion. Further, for 619 projects neither the commissioning year nor the tentative gestation period has been declared. Out of the 647 delayed projects, 103 have overall delays in the range of 1-12 months, 111 have been stalled for 13-24 months, 314 projects for 25-60 months, and 119 projects have been stalled for 61 months and more. The average time overrun in these 647 stalled projects was 42.83 months. Reasons for time overruns as informed by various project executing agencies include delay in land acquisition, delay in acquiring forest and environment approvals, delay in finalisation of detailed engineering, lack of infrastructure support and linkages, ordering and equipment supply, delay in tie-up for project financing, change in scope, delay in tendering, and law and order problems. The report also mentioned state-wise lockdowns due to Covid-19 as a cause for the delay in execution of these projects. It has also been observed that project companies are not informing revised cost estimates and commissioning plans for many projects, which indicates that time and cost overrun figures are under-reported. Image Source Also read: Around 425 infra projects note cost overruns worth Rs 4.83 lakh cr

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