There has been a 54 per cent increase in cumulative cost of 16 major Central government projects in Tamil Nadu due to cost over run for reasons like financial and administrative factors. This was disclosed by Rao Inderejit Singh, Union Minister of State (Independent Charge) of the Ministry of Statistics, while replying to a question raised by Arni MP MK Vishnu Prasadh in the Lok Sabha recently.

The original cumulative cost of the 16 projects was ₹40,068 crore but the delays increased it to ₹61,577 crore. Of the 16 projects, four are railways and three national highways.

For example, two railway projects were approved in 1995 and 2007 were to be completed in 2020 and 2019 respectively. However, they are likely to be completed in 2025.

The reasons for time and cost overruns are project-specific, depending on various technical, financial and administrative factors. It also differed for every project. There were law and order problems; delays in land acquisition; delays in environment and forest clearances; funding constraints; rehabilitation and settlement issues; local body/municipal permission and Covid-19 lockdown, the minister said.

However, as reported by the project implementing agencies on the ministry’s Online Computerised Monitoring System (OCMS), the main reason for the increase in cost of the projects are under-estimation of original cost; high cost of environmental safeguards and rehabilitation measures; spiralling land acquisition cost; shortage of skilled manpower; changes in project scope; monopolistic pricing by vendors of equipment services; general price rise/inflation and time overruns.

On steps taken to minimise the cost/time overrun of the projects, the minister replied that there is now periodic revision of the projects under Pro Active Governance and Timely Implementation (PRAGATI) through video conferencing by Prime Minister; rigorous project appraisal; OCMS for better monitoring; setting up of Revised Cost Committees in the ministries for regular review of infrastructure project by the concerned administrative ministries.

Steps are also taken to set up the Central Sector Projects Coordination Committee in the States under the Chief Secretaries for removal of bottlenecks and for facilitating the speedy implementation of major projects, the minister said.

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