Majority of projects under construction delayed: CARE

Not all is well for central infrastructure projects, as 75 per cent of those under implementation are either delayed or do not have a definitive timeline, according to CARE Ratings. In addition, the cost overrun on some projects is expected to be ~2.18 trillion.

The original cost is ~16.2 trillion. Not all delayed projects are facing legacy issues. A break up for the delayed projects was not shared. However, the report stated the number of projects under implementation has grown from 727 in April 2014 to 1,304 in February.

"Delayed or projects without a definitive timeline of completion make up almost 75 per cent of the total projects being implemented; 262 projects are delayed and 721 projects have no definitive timeline for implementation," CARE said. The report added the 721 projects without a definitive timeline are unmonitored and are yet to report timelines.

The report is based on 1,304 central sector infrastructure projects that cost more than ~1.5 billion.

Land acquisition delays, environmental clearances, lack of linkages, delay in detailed engineering, change in scope, contract issues, tender delays and law and order issues were some of the reasons for the delay.

Of the 1,304 projects, 343 have a cost overrun and around 100 projects are showing cost overruns and delays, went the report. The expected rise in costs involved is ~2.18 trillion.

"The original cost of implementation was ~16.2 trillion. These projects, after latest evaluation, are expected to cost ~18.38 trillion, of which ~6.36 trillion or 34.6 per cent of original cost have been incurred," CARE said.

In the previous financial year, of the expected 343 projects to be completed, only 82, with a cumulative expenditure of ~1.27 trillion, have been completed as of February-end.

Sector-wise, the railways sector has the largest proportion of delayed projects. "203 of the 334 projects are facing cost overrun. In terms of timeoverrun, 33 projects are delayed with regards to the revised schedule," the report said.

The situation continues to look grim for the power sector, with 54 per cent of the projects under implementation facing a time overrun. "Nearly 50 projects are facing time overrun with regards to the latest schedule. Around 48 of the 121 projects being implemented are facing cost overrun," CARE said.