Rs 5.75-trn cost overrun hits many infra projects

Beyond Limits

♦ Total cost escalation is 20.85% in June

♦ Railways suffered highest cost overruns

♦ Original cost of its 231 projects rose to Rs674,424.3 cr from Rs429,868.26 cr

♦ In AP, original cost of 108 projects rose to Rs205,655.99 cr from Rs146,148.2 cr

♦ In Telangana, original cost of 53 projects rose to Rs41,226.16 cr from cost Rs38,381.66 cr

New Delhi: Cost overruns increased to Rs575,330.21 crore in June, up from Rs5.71 lakh crore in May, in the 1,810 infrastructure projects, each with an investment of Rs150 crore or above.

The original cost of the 1,810 projects was Rs2,759,410.82 crore, but now it is estimated to be Rs3,334,741.03 crore, official sources told Bizz Buzz. They, however, did not divulge the number of projects which have incurred cost escalation. In May, that number was 458.

Total cost escalation is 20.85 per cent over the original cost in June.

Projects under the Railways Ministry have suffered the highest cost overruns, Rs244,556.04 crore. While the original cost of its 231 projects was Rs429,868.26 crore, now, it is anticipated to be Rs674,424.3 crore.

In Andhra Pradesh, there are 108 ongoing projects with the original cost of Rs146,148.2 crore, which is now estimated at Rs205,655.99 crore.

In Telangana, there are 53 projects, which were expected to cost Rs38,381.66 crore. As per the current estimates, they will cost Rs41,226.16 crore.

As many as 18 projects were completed in June, but except one all of them were delayed. Some of them were supposed to get commissioned way back in 2016.

The four-laning of Khedakhajuria to Suhagadi (from KM 41.4 to KM 89.2 of National Highway) in Madhya Pradesh completed before the scheduled commissioning in October this year. Another good thing about this project was that its actual expenditure, Rs370.28 crore, was less than half of the original cost of Rs876.37 crore.

In fact, the original cost of the 18 projects was Rs8,572.6 crore, but the actual expenditure was Rs6,616.87 crore.

In June, the government also froze or deleted eight infrastructure projects, which were estimated to cost Rs5,115.22 crore of which Rs1,431.73 crore had already been spent. Four of these projects were under the Ministry of Railways, while two each were under the Ministries of Road and Coal.