An official report from the Ministry of Statistics and Programme Implementation (MoSPI) reveals that 431 infrastructure projects, each requiring an investment of Rs 150 crore or more, experienced cost overruns exceeding Rs 4.82 lakh crore in December 2023. Out of a total of 1,820 monitored projects, the report highlights that 848 projects faced delays, leading to a complex scenario of both cost overruns and timeline extensions.
Financial Implications: Escalation of Original Costs
The original cost of implementing the 1,820 projects was Rs 25,87,066.08 crore. However, the anticipated completion cost is projected to be Rs 30,69,595.88 crore, indicating a substantial overall cost overrun of Rs 4,82,529.80 crore, equivalent to 18.65% of the original cost.
Expenditure Analysis: 53% Spending Incurred as of December 2023
The report notes that the expenditure incurred on these projects until December 2023 amounts to Rs 16,26,813.80 crore, representing 53% of the anticipated total cost. While the total number of delayed projects stands at 848, the report suggests a decrease to 638 if delays are calculated based on the latest completion schedule.
Time Overruns: Average Delay of 36.59 Months
For the 848 delayed projects, the average time overrun is reported to be 36.59 months, indicating significant delays in project completion.
Variety in Delays: Diverse Time Ranges for Delayed Projects
The report categorizes delays into different time ranges, revealing that 202 projects experienced delays of 1-12 months, 200 projects faced delays of 13-24 months, 323 projects were delayed for 25-60 months, and 123 projects were delayed for more than 60 months.
Reasons Behind Delays: Challenges Identified by Implementing Agencies
Project implementing agencies cite various reasons for time overruns, including issues such as delays in land acquisition, obtaining forest and environment clearances, and deficiencies in infrastructure support and linkages.
Additional Challenges: Diverse Factors Contributing to Delays
Apart from the primary reasons, the report outlines other factors contributing to delays, such as complications in tying up project financing, finalizing detailed engineering, changes in project scope, issues in the tendering process, equipment supply, and law and order problems.
The report acknowledges state-wise lockdowns due to COVID-19, imposed in 2020 and 2021, as contributing to delays in project implementation.
Reporting Discrepancies: Under-Reporting of Time/Cost Overruns
A critical observation in the report notes that project executing agencies often do not report revised cost estimates and commissioning schedules for many projects. This raises concerns about the potential under-reporting of time and cost overrun figures.
(With PTI Inputs)