As many as 421 infrastructure projects, each entailing investment of Rs 150 crore or more, have been hit by cost overruns of more than Rs 4.73 lakh crore, according to a report. The Ministry of Statistics and Programme Implementation monitors infrastructure projects of Rs 150 crore and above.
Of 1,565 such projects, 421 projects reported cost overruns and 647 projects were delayed. "Total original cost of implementation of the 1,565 projects was Rs 21,86,542.05 crore and their anticipated completion cost is likely to be Rs 26,59,914.61 crore, which reflects overall cost overruns of Rs 4,73,352.56 crore (21.65% of original cost)," the ministry’s latest report for February 2022 said.
According to the report, the expenditure incurred on these projects till February 2022 is Rs 13,26,569.75 crore, which is 49.87 percent of the anticipated cost of the projects. However, the number of delayed projects decreases to 553 if delay is calculated on the basis of the latest schedule of completion.
Further, for 631 projects neither the year of commissioning nor the tentative gestation period has been reported. Out of the 647 delayed projects, 84 have overall delay in the range of 1-12 months, 124 have been delayed for 13-24 months, 327 projects for 25-60 months and 112 projects have delays of 61 months and above.
The average time overrun in these 647 delayed projects is 42.60 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 are among the other reasons.COVID-19 as a reason for the delay in implementation of these projects. It has also been observed that project agencies are not reporting revised cost estimates and commissioning schedules for many projects, which suggests that time/cost overrun figures are under-reported, it stated.