As many as 417 infrastructure projects, each entailing an investment of ₹150 crore or more, have been hit by cost overruns of more than ₹4.77 lakh crore in September this year, mentions the latest report by the Ministry of Statistics and Programme Implementation for September 2023.
The Statistics Ministry, which monitors infrastructure projects worth ₹150 crore or more, said out of 1,763 projects, about one-fourth (417) reported cost overruns and half (842) of them have been delayed.
“Total original cost of implementation of the 1,763 projects was ₹24,86,402.70 crore and their anticipated completion cost is likely to be ₹29,64,345.13 crore,” which reflected cost overruns of almost 20% of original cost, the report mentioned.
According to the report, the expenditure incurred on these projects till September 2023 was ₹15,44,600.67 crore, which is 52.11% of the anticipated cost of the projects.
However, it stated that the number of delayed projects decreased to 617, if delay is calculated on the basis of the latest schedule of completion. Further, it stated that for 298 projects neither the year of commissioning nor the tentative gestation period has been reported.
Out of the 842 delayed projects, 194 have overall delays in the range of 1-12 months, 190 have been delayed between one-two years, while 323 projects have been delayed between two and five years, and another 123 projects have been delayed by more than five years. The average time overrun in these projects is more than three years.
Reasons for time overruns as reported by project implementing agencies include delays in land acquisition, obtaining forest and environment clearances, and lack of infrastructure support and linkages. Delays in tie-ups for project financing, finalisation of detailed engineering, change in scope, tendering, ordering and equipment supply, and law and order problems were among the other reasons.
The report also cited state-wise lockdowns during the COVID-19 pandemic in 2020 and 2021 for the delays.
It has also been observed that project executing agencies are not reporting revised cost estimates and commissioning schedules for many projects, which suggests time/cost overrun figures are under-reported, the report added.