As many as 431 infrastructure projects were hit by cost overruns of more than Rs 4.80 lakh crore in January 2024, an official report stated. Each project entails an investment of Rs 150 crore or above.
According to the Ministry of Statistics and Programme Implementation (MoSPI), out of 1,821 projects, 431 reported cost overruns, and 780 projects were delayed. MoSPI monitors infrastructure projects worth Rs 150 crore and above.
The total initial cost of implementation of the 1,821 projects was Rs 26,09,679.38 crore, and their expected completion cost is likely to be Rs 30,90,135.99 crore, the ministry’s latest report for January 2024 said. This reflects overall cost overruns of Rs 4,80,456.61 crore (18.41 per cent of the original cost).
According to the report, till January 2024, the expenditure incurred on these schemes is Rs 16,43,821.69 crore. It is 53.20 per cent of the expected cost of the projects.
However, it said that the number of delayed schemes decreases to 583 (if the delay is calculated on the basis of the latest schedule of completion). It further informed that for 373 schemes, neither the year of commissioning nor the tentative gestation period was reported.
Out of the 780 delayed schemes, 194 have overall delays in the range of 1-12 months, for 13-24 months – 187 projects have been delayed, 284 projects delayed for 25-60 months, and 115 schemes have been delayed for more than 60 months. 36.13 months is the average time overrun in these projects.
Causes for time overrun, as reported by various project implementing agencies, include delay in land acquisition, in obtaining forest and environment approvals, and absence of infrastructure support and linkages.
Among the other causes are – delays in tie-up for project financing, finalisation of detailed engineering, tendering, change in scope, ordering and equipment supply, and law and order issues.
The Ministry of Statistics and Programme Implementation’s report also mentioned state-wise lockdowns due to COVID-19 (imposed in 2020 and 2021) as a reason for the delay in the implementation of these projects.