Huge cost overrun for Indian Railways! The national transporter, which accounts for around three-fifths of 344 central sector projects, is facing huge cost overruns due to delay in project implementation for various reasons.
The latest flash report of the Statistics and Programme Implementation Ministry (MOSPI) for the month of December 2018 showed that the total cost overrun for as many as 205 projects of Indian Railways is at a whopping Rs 2.21 lakh crore, according to a PTI report. All the central sector projects are monitored by the MOSPI, which involves an expenditure of Rs 150 crore and above.
As per the report, up to December 2018, the total original cost of these 205 railway projects was Rs 1,68,116.34 crore. The total anticipated cost of these 205 railway projects is being estimated at Rs 3,89,745.97 crore, indicating an overall cost escalation by 131.83 per cent. The MOSPI monitored a total of 367 projects of Indian Railways in the month of December 2018. According to the report, 94 of these railway projects reported time overrun or delay of 1 month to 324 months.
After Indian Railways, the power sector registered the second highest incidence of overall cost overrun. 40 projects out of the 95 projects that are monitored by the ministry in the power sector, reported cost overrun of Rs 63,334.88 crore. The total original cost of these 40 projects of the power sector was Rs 1,72,830.59 crore. The cost of these projects escalated to an anticipated cost of Rs 2,36,165.47 crore. According to the report, 56 projects out of the 95 power sector projects reported time overrun (delay) of 2 months to 147 months.
After Indian Railways and power sector, the road transport and highways sector recorded the third largest cost escalation, where 49 out of the 605 monitored projects, reported cost overrun. These road transport and highway sector projects reported a cost overrun of Rs 15,000.56 crore. The total original cost of these projects was Rs 29,654.32 crore, which escalated to an amount of Rs 44,654.88 crore. A total of 112 projects in the road transport and highway sector reported a delay of 1 month to 131 months, the report said.