MoSPI reported 343 infra projects hit with cost overruns

NEW DELHI: A recent report from the Ministry of Statistics and Programme Implementation, Government of India stated that close to 343 infrastructure projects have been hit with cost overruns of ₹4.5 lakh crore. 343 projects out of 1,438, with investments of ₹150 crore and more, have been reported for cost overruns and 835 projects have been delayed.

According to the Ministry’s report, “total original cost of implementation of the 1,438 projects was ₹20,35,794.75 crore and their anticipated completion cost is likely to be ₹24,86,069.52 crore, which reflects overall cost overruns of ₹4,50,274.77crore (22.12 per cent of original cost).”

The report showed that for 342 projects, neither the year of commissioning nor the tentative gestation period has been reported. And if the delay is calculated on the basis of the latest schedule of completion, the number of delayed projects decreases to 673 projects.

Out of the 835 delayed projects, 160 have overall delays in the range of 1-12 months, 134 have been delayed for 13-24 months, 411 projects for 25-60 months, and 130 projects have been delayed for 61 months and above. The average time overrun in these 835 delayed projects is 40.5 months.

Reasons for time overruns include delay in land acquisition, delay in obtaining forest and environmental clearances, and lack of infrastructure support and linkages as reported by various project implementing agencies.

Delay in tie-up for project financing, finalisation of detailed engineering, change in scope, tendering, ordering and equipment supply, and law and order problems were among the other reasons.