A recent official report revealed that in December 2023, a total of 431 infrastructure projects, each requiring an investment of Rs 150 crore or more, faced a cost overrun exceeding Rs 4.82 lakh crore. The Ministry of Statistics and Programme Implementation (MoSPI), responsible for monitoring infrastructure projects with a value of Rs 150 crore and above, reported that out of 1,820 projects, 431 experienced cost overruns, and 848 projects encountered delays.
The initial cost of implementing the 1,820 projects was Rs 25,87,066.08 crore, and the projected completion cost is estimated to be Rs 30,69,595.88 crore, indicating an overall cost overrun of Rs 4,82,529.80 crore, equivalent to 18.65% of the original cost, according to the ministry’s December 2023 report.
The report disclosed that expenditures incurred on these projects until December 2023 amounted to Rs 16,26,813.80 crore, representing 53% of the anticipated project cost. However, the number of delayed projects decreased to 638 when considering delays based on the latest completion schedule.
Additionally, the report highlighted that for 298 projects, neither the year of commissioning nor the tentative gestation period has been specified. Out of the 848 delayed projects, 202 experienced overall delays within the range of 1-12 months, 200 were delayed for 13-24 months, 323 projects faced delays of 25-60 months, and 123 projects were delayed for more than 60 months. The average time overrun for these 848 delayed projects was 36.59 months.
Various project implementing agencies cited reasons for time overruns, including delays in land acquisition, obtaining forest and environment clearances, and a lack of infrastructure support and linkages. Other contributing factors included delays in securing project financing, finalizing detailed engineering, changes in scope, tendering, ordering and equipment supply, as well as law and order problems.
The report also identified state-wise lockdowns due to COVID-19 (imposed in 2020 and 2021) as a factor causing delays in the implementation of these projects. Furthermore, it pointed out that project executing agencies often fail to report revised cost estimates and commissioning schedules for many projects, implying that time/cost overrun figures may be underreported.
