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In November, 421 Indian infrastructure projects, each exceeding Rs 150 crore, encountered cost overruns surpassing Rs 4.40 lakh crore, according to the Ministry of Statistics and Programme Implementation (MoSPI). Among 1,831 projects monitored by MoSPI, 421 reported cost overruns, and 845 experienced delays.
The original cost of these projects was Rs 25,10,577.59 crore. With an anticipated completion cost of Rs 29,50,997.33 crore, the overall cost overrun is of Rs 4,40,419.74 crore, which is almost 17.54% of the initial cost. As of November 2023, Rs 15,58,038.07 crore had been spent, representing 52.80% of the projects' expected costs.
When recalculated based on the latest schedule of completion, the number of delayed projects decreases to 629. Within the delayed projects, 204 face delays of 1-12 months, 198 are delayed for 13-24 months, 322 projects experience delays of 25-60 months, and 121 projects are delayed by more than 60 months. The average time overrun for these 845 delayed projects is reported at 36.64 months.
Project implementing agencies highlighted delays in land acquisition, obtaining forest and environment clearances, and insufficient infrastructure support as the major reason for delays. Other contributing factors include delays in securing project financing, finalizing detailed engineering, alterations in project scope, issues in the tendering process, delays in equipment supply, and law and order problems. The state-wise lockdowns due to COVID-19 in 2020 and 2021 was also a notable factor causing delays in project implementation.
This comprehensive analysis paints a vivid picture of the challenges plaguing large-scale infrastructure projects in India, encompassing financial, logistical, and regulatory hurdles. Despite a recalibration of delayed projects, challenges persist. These findings emphasize the need for comprehensive reforms and effective project management strategies in the Indian infrastructure landscape for sustained economic development.
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