Price of Procrastination
I Satya Sundaram
It is an open secret that government finances are poorly managed. A case in point is the delay in the completion of public projects, leading to cost overruns.
During 2014-15, of the 751 central sector projects, only three were ahead schedule, 123 on schedule, 329 behind schedule, and 297 are without data of commissioning. Of the 329 delayed projects, road (104) and power (63) projects comprise the biggest chunk, followed by railways and steel projects. The delays have resulted in a cost overrun of Rs1.2 lakh crore. Interestingly, a whopping 242, out of the total 288 railway projects, have no date of commissioning, showing government's indifference.
The Report of CAG (Comptroller and Auditor General of India) was tabled in Parliament on December 18, 2015. It said the delay in completion of railway projects had resulted in a cost overrun of Rs 1.07 lakh crore. The report had also observed that 75 projects (out of 442 on-going projects, have bean on-going for over 15 years, and of these, three were 30 years old.
There are a number of reasons for the delay in implementation of projects. These include : delay in land acquisition, environment and other regulatory clearances, high interest rates, weak demand, rising raw material prices, rising land acquisition, manpower and equipment costs.
According to CAG, Railways needs to prioritise projects on a short term basis and ensure adequate funding to avoid time overruns. CAG also emphasised proper monitoring the execution of projects at both the Railway Board and Zonal level.
Vol. 48, No. 29, Jan 24 - 30, 2016