Cost of project delays: Rs 45k cr

Nearly 50 per cent of big projects in India are running late, resulting in the government spending Rs 45,000 crore more than the original cost, reports Chetan Chauhan.

Updated on: Aug 3, 2009, 24:39:45 IST

Hindustan Times | By Chetan Chauhan, New Delhi

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Nearly 50 per cent of big projects in India are running late, resulting in the government spending Rs 45,000 crore more than the original cost.

Going by the Planning Commission’s estimate of a poor person spending less than Rs 10 a day on food, Rs 45,000 crore is enough to feed 30 crore for five months.

This staggering sum could have financed the midday meal scheme for the country’s 14 crore school going children for a month, or bought the airforce 1800 HAL helicopters.

In its report to the government, the Ministry of Statistics and Programme Implementation has estimated the escalation cost of 925 projects at more than Rs 20 crore each.

It found that 423 of these projects —or nearly 50 per cent —have been delayed by between six months and two years, the main reason for rendering them more expensive than estimated initially.

The 2,000 MW nuclear power plant at Kadankula, Tamil Nadu alone, delayed by 18 months, for instance, has seen a price escalation of Rs 3,796 crore.

“Cost overruns in the 423 projects is close to Rs 45,500 crore, 17 per cent of the original cost of Rs 2,46,070 crore,” a senior ministry official, who did not want to be named, said.

The reasons for the delay vary. "In many cases, the project proponents failed to acquire land in time to start the project. Projects were also held up due to delay in getting environmental clearance, especially for power and road projects," the official said.

To prevent such delays, the Committee on Infrastructure under the Planning Commission has decided that no project in future will be approved until 70 per cent of land required to implement it is acquired. “It will reduce delays by 50-60 per cent,” a panel member said.

Environment Minister Jairam Ramesh said his ministry would try to give environment and forest approval in a time-bound manner.

“We want such a regime where the project proponent is told within a specified time whether the project can get clearance or not, rather than having repeated hearings,” he said.

ABOUT THE AUTHOR
Chetan Chauhan
Chetan Chauhan is the National Affairs Editor looking into all aspects of news and features from across India. A Chevening scholar with over three decades of experience in reporting and news management, Chetan has extensively covered all important aspects of the social sector, political economy, environment and climate change nationally and internationally. He did a journalism course at the Reuters Institute of Journalism in Oxford and Digital Media training at Nanyang Technological University in Singapore. He started as a reporter with The Statesman in 1996 and joined the Hindustan Times in 2000 in the metro bureau covering environment, crime and Delhi politics. He covered hot local news, from the Jessica Lal murder case to the rebellion of Delhi Congress MLAs against then Chief Minister Sheila Dikshit, to the replacement of toxic vehicle fuel with cleaner compressed natural gas (CNG) in the national capital. Some of his stories on air pollution became part of the Supreme Court’s landmark MC Mehta versus Government of India case in the National Capital Region (NCR), forcing the government to take corrective measures. As part of the national political bureau since 2004, he covered important central sectors such as environment, education, social justice, labour, rural development, water resources, renewable energy, agriculture, broadcasting and the Planning Commission for more than a decade producing several exclusive and investigative breaking stories. His specialisation is the environment, having covered at least a dozen United Nations global conferences on climate change, biodiversity and wildlife including climate summits in Paris, Copenhagen and Bali. He also covered India’s two five-year plans ---11th and 12th and reported on drafting and execution of right based laws such as Right to Education, Right to Information and rural job guarantee law, MG-NREGA, now being introduced in new format as VG-RAM-G Act. He has in-depth knowledge of social sector issues. He was one of the first to report on tigers vanishing from Sariska and Panna wildlife reserves in 2004 and 2008, respectively, leading to the setting up of the National Tiger Conservation Authority (NTCA) and the introduction of stringent penal provisions for poaching. He has written extensively on the rising human-animal conflict in India and the degradation of India’s biodiversity hotspots because of mining and other activities. Since 2004, Chetan has covered Parliament comprehensively and participated in training on the nuanced coverage of Parliament proceedings. He has travelled extensively across India to cover national and provincial elections since 1998, especially in the Hindi heartland states, considered India’s road to power. He writes a regular column for Hindustan Times, Ecostani, on important national politics, economy, Himalayan ecology and environmental issues. His other responsibilities include providing inputs for edits and edit page articles for the publication, apart from managing news flow from across India.Read More

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