Infrastructure projects: 443 infrastructure projects show cost overruns of Rs 4.45 lakh crore

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As many as 443 infrastructure projects, each involving an investment of Rs 150 crore or more, have been hit by cost overruns totaling more than Rs 4.45 lakh crore, according to a report. The Ministry of Statistics and Program Implementation monitors infrastructure projects of Rs 150 crore and above.

Of 1,671 such projects, 443 projects reported cost overruns and 514 projects were delayed.

“The total initial cost of implementing the 1671 projects was Rs 22,54,175.77 crore and their expected cost of completion is likely to be Rs 26,99,651.62 crore, reflecting overall cost overruns of Rs 4 ,45,475.85 crore (19.76% of original cost),,” the ministry’s latest report for January 2022 states.

According to the report, the expenditure incurred for these projects till January 2022 was Rs 13,16,293.63 Crore which is 48.76% of the projected cost of the projects.

However, the number of delayed projects decreases to 381 if the delay is calculated based on the latest completion schedule.

Additionally, for 881 projects, neither the commissioning year nor the tentative gestation period was reported.

Of the 514 projects delayed, 89 have an overall delay of 1 to 12 months, 113 have been delayed by 13 to 24 months, 204 projects by 25 to 60 months and 108 projects have delays of 61 months or more.

The average overrun of these 514 delayed projects is 46.23 months.

Reasons for time overruns reported by various project implementing agencies include delay in land acquisition, delay in obtaining forestry and environmental permits, and lack of infrastructural support and linkages.

Delay in project financing, delay in finalizing detailed engineering, change of scope, delay in tendering, ordering and supplying equipment, and public order issues are among the other reasons.

The report also cited state-level lockdowns due to COVID-19 as the reason for the delay in the implementation of these projects.

It was also observed that project agencies are not reporting revised cost estimates and commissioning schedules for many projects, suggesting that time/cost overrun figures are under-reported. -he declares.

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