Lok Sabha Question No. 1730 (UNSTARRED), answered on 2023-12-13
Subject: Cost Overrun Infrastructure Projects
Ministry: STATISTICS AND PROGRAMME IMPLEMENTATION
Asked by: Ravneet Singh

## GOVERNMENT OF INDIA MINISTRY OF STATISTICS AND PROGRAMME IMPLEMENTATION

LOK SABHA UNSTARRED QUESTION NO. 1730 TO BE ANSWERED ON 13.12.2023

## COST OVERRUN INFRASTRUCTURE PROJECTS

## 1730.      SHRI RAVNEET SINGH BITTU:

Will the Minister of STATISTICS AND PROGRAMME IMPLEMENTATION be pleased to state:

- (a)  whether  a  large  number  of  infrastructure  projects  of  the Government each entailing an investment of Rs.150 crore or more have been hit by cost overruns in the country;
- (b)  if  so,  the  details  thereof,  State/UT-wise  especially in  the State of Punjab;
- (c)  the  detailed  reasons  for  these  huge  cost  overruns  on Government infrastructure projects in the country;
- (d)   whether there is non-reporting of revised cost estimates and commissioning schedules for many projects by the project executing agencies and if so, the details thereof; and
- (e)   whether the Government has taken any measures to fix the issue in this regard, is so, the details thereof?

## ANSWER

MINISTER OF STATE (INDEPENDENT CHARGE) OF THE MINISTRY OF STATISTICS  AND  PROGRAMME  IMPLEMENTATION,  MINISTER  OF STATE (INDEPENDENT CHARGE) OF THE MINISTRY OF PLANNING AND MINISTER OF STATE IN THE MINISTRY OF CORPORATE AFFAIRS

[RAO INDERJIT SINGH]

- (a) & (b) As per latest Flash Report for the month of October, 2023 published by Ministry of Statistics & Programme Implementation, out of total 1788 Central Sector Projects, 411 Projects are having cost overrun.   The  state/UT  wise  details  (including  Punjab)  of  these projects is at Annexure.
- (c) The reasons for cost escalation are project-specific, and depend on a variety of technical, financial and administrative factors, and differ  from project to project. However, as reported by the project implementing  agencies  on  the  On-line  Computerized  Monitoring System (OCMS) portal of the ministry, the main reasons for increase in cost of the projects are: Under-estimation of original cost; Changes in  rates  of  foreign  exchange  and  statutory  duties;  High  cost  of environmental safeguards & rehabilitation measures; Spiralling land acquisition costs; Shortage of skilled manpower/ labour; Changes in Project scope; Monopolistic pricing by vendors of equipment services; General Price rise / inflation and Time Overruns. Delay in land acquisition and forest clearance has been one of the reasons for time overrun leading to cost overrun as reported by implementing agencies.
- (d) Yes Sir, there are 134 Central Sector Projects which required to revise  the  cost  estimate.  For  290  projects  neither  the  year  of commissioning nor the tentative gestation period has been reported. The detail of these projects is available at http://www.cspm.gov.in/english/publication.
- (e)   The steps  taken by the Government  to  control  the  cost escalation are: Periodic review of projects under PRAGATI; rigorous project appraisal; OCMS for better monitoring; setting up of Revised Cost Committees in the Ministries; regular review of infrastructure projects by the concerned administrative Ministries; and setting up of Central Sector Projects Coordination Committees (CSPCCs) in the States under  the concerned  Chief  Secretaries for  removal  of bottlenecks and for facilitating the speedy implementation of major projects.

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Annexure

## ANNEXURE REFERRED TO IN REPLY TO PART (a) & (b) OF THE LOK SABHA UNSTARRED QUESTION NO. 1730 TO BE ANSWERED ON 13/12/2023

## State-wise Number of Projects Having Cost Overrun

All cost are in Rs Crore

|   SI.No | State                       |   No. of Projects | Original Cost   | Antici pated Cost   |   Cost overrun (%) |   No. | Original Cost   | Anticipated Cost   |   Cost overrun (%) |
|---------|-----------------------------|-------------------|-----------------|---------------------|--------------------|-------|-----------------|--------------------|--------------------|
|       1 | ANDHRA PRADESH              |                97 | 1,33,439.34     | 1,89,980.07         |              42.37 |    29 | 57,723.40       | 1,14,661.17        |              98.64 |
|       2 | ARUNACHAL PRADESH           |                28 | 49,473.75       | 64,435.96           |              30.24 |     1 | 6,285.33        | 21,247.54          |             238.05 |
|       3 | ASSAM                       |                55 | 56,689.13       | 64,839.76           |              14.38 |     8 | 18,906.07       | 28,459.63          |              50.53 |
|       4 | BIHAR                       |                93 | 1,13,905.20     | 1,37,601.82         |              20.8  |    31 | 38,975.70       | 63,746.16          |              63.55 |
|       5 | GOA                         |                11 | 6,567.98        | 6,628.08            |               0.92 |     1 | 303.90          | 364.00             |              19.78 |
|       6 | GUJARAT                     |                91 | 1,44,538.07     | 1,62,805.63         |              12.64 |    26 | 39,210.89       | 58,119.76          |              48.22 |
|       7 | HARYANA                     |                33 | 68,389.49       | 70,677.32           |               3.35 |     6 | 7,370.41        | 9,658.28           |              31.04 |
|       8 | HIMACHAL PRADESH            |                27 | 26,047.08       | 38,199.85           |              46.66 |     8 | 10,926.82       | 23,297.14          |             113.21 |
|       9 | JAMMU AND KASHMIR           |                45 | 67,258.12       | 1,02,275.02         |              52.06 |     3 | 4,997.72        | 40,014.62          |             700.66 |
|      10 | KARNATAKA                   |                77 | 99,671.14       | 1,03,636.57         |               3.98 |    19 | 14,407.05       | 19,868.07          |              37.91 |
|      11 | KERALA                      |                31 | 63,259.81       | 70,594.48           |              11.59 |    13 | 28,840.42       | 36,933.69          |              28.06 |
|      12 | MADHYA PRADESH              |                82 | 73,994.86       | 85,360.20           |              15.36 |    13 | 18,197.77       | 29,786.78          |              63.68 |
|      13 | MAHARASHTRA                 |               217 | 2,06,782.13     | 2,30,693.70         |              11.56 |    29 | 78,135.49       | 1,08,820.73        |              39.27 |
|      14 | MANIPUR                     |                32 | 14,557.83       | 24,425.66           |              67.78 |     1 | 4,454.17        | 14,322.00          |             221.54 |
|      15 | MEGHALAYA                   |                14 | 5,372.73        | 12,735.93           |             137.05 |     1 | 906.46          | 8,324.28           |             818.33 |
|      16 | MIZORAM                     |                19 | 10,827.75       | 19,404.27           |              79.21 |    11 | 7,115.01        | 15,719.90          |             120.94 |
|      17 | NAGALAND                    |                34 | 12,139.03       | 16,489.44           |              35.84 |     2 | 2,699.59        | 7,050.00           |             161.15 |
|      18 | ODISHA                      |                85 | 1,18,068.75     | 1,25,113.28         |               5.97 |    19 | 17,608.67       | 24,754.47          |              40.58 |
|      19 | PUNJAB                      |                34 | 31,046.16       | 31,274.14           |               0.73 |     3 | 1,008.10        | 1,236.08           |              22.61 |
|      20 | RAJASTHAN                   |                73 | 82,119.63       | 87,299.34           |               6.31 |     3 | 13,624.08       | 18,978.32          |              39.3  |
|      21 | SIKKIM                      |                21 | 14,177.10       | 21,062.97           |              48.57 |     5 | 2,361.46        | 9,371.18           |             296.84 |
|      22 | TAMIL NADU                  |                74 | 2,12,065.17     | 2,34,918.06         |              10.78 |    30 | 51,023.60       | 75,187.00          |              47.36 |
|      23 | TRIPURA                     |                17 | 4,961.02        | 5,317.50            |               7.19 |     8 | 2,080.89        | 2,437.37           |              17.13 |
|      24 | UTTAR PRADESH               |               123 | 1,57,484.07     | 1,79,425.86         |              13.93 |    36 | 49,321.11       | 72,127.19          |              46.24 |
|      25 | WEST BENGAL                 |                62 | 71,886.35       | 91,106.01           |              26.74 |    22 | 31,678.10       | 51,523.91          |              62.65 |
|      26 | ANDAMAN AND NICOBAR ISLANDS |                 9 | 2,847.18        | 3,118.54            |               9.53 |     2 | 655.03          | 945.73             |              44.38 |
|      27 | DELHI                       |                29 | 93,102.83       | 97,504.84           |               4.73 |    10 | 51,768.05       | 56,257.49          |               8.67 |
|      28 | PUDUCHERRY                  |                 1 | 195.00          | 195.00              |               0    |     0 | 0.00            | 0.00               |               0    |
|      29 | CHHATTISGARH                |                57 | 67,233.03       | 68,837.92           |               2.39 |    10 | 12,535.72       | 14,758.32          |              17.73 |
|      30 | JHARKHAND                   |                67 | 96,816.59       | 1,04,162.24         |               7.59 |    18 | 27,824.55       | 36,964.89          |              32.85 |
|      31 | UTTARAKHAND                 |                30 | 36,188.46       | 54,008.18           |              49.24 |     7 | 25,172.12       | 42,991.84          |              70.79 |
|      32 | TELANGANA                   |                46 | 32,326.07       | 35,213.70           |               8.93 |     7 | 13,264.18       | 16,151.81          |              21.77 |
|      33 | LADAKH                      |                 8 | 2,767.29        | 2,926.96            |               5.77 |     1 | 480.33          | 640.00             |              33.24 |
|      34 | MULTI STATE                 |                66 | 3,02,248.46     | 3,67,258.33         |              21.51 |    28 | 55,849.70       | 1,22,150.15        |             118.71 |