450 infra projects show cost overruns of Rs 4.28 lakh crore

Representational Image

As many as 450 infrastructure projects, each worth Rs 150 crore or more, have been hit by cost overruns totalling more than Rs 4.28 lakh crore, according to a report.

  The Ministry of Statistics and Programme Implementation monitors infrastructure projects worth Rs 150 crore and above.

Of the 1,687 such projects, 450 reported cost overruns and 558 were delayed.

“Total original cost of implementation of the 1,687 projects was Rs 21,44,627.66 crore and their anticipated completion cost is likely to be Rs 25,72,670.28 crore, which reflects overall cost overruns of Rs 4,28,042.62 crore (19.96 per cent of original cost),” the ministry’s latest report for December 2020 said.

The expenditure incurred on these projects till December 2020 was Rs 12,17,692.37crore, which was 47.33 per cent of the anticipated cost of the projects.

However, the report said the number of delayed projects decreases to 408 if delay is calculated on the basis of latest schedule of completion.

Further, for 923 projects, neither the year of commissioning nor the tentative gestation period has been reported.

Out of 558 delayed projects, 111 projects have overall delay in the range of 1-12 months and 135 projects have delay of 13-24 months. As many as 187 projects reflect delay in the range of 25-60 months and 125 projects show delay of 61 months and above. The average time overrun in these 558 delayed projects is 45 months.

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

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

The report also cited ‘state-wise lockdown due to COVID-19’ as a reason for delay in implementation of these projects.

Project agencies are not reporting revised cost estimates and commissioning schedules for many projects, which suggests that time and cost overrun figures are under-reported, it added.