Project_Delay

Centre's project execution slips further on land, funding issues http://www.thehindubusinessline.com/2010/08/31/images/2010083152170501.jpg BL Research Bureau NTPC's Koldam HEP hydro power project, originally due for commissioning by April 2009 is now anticipated to come up only by December 2011. This is just one among the many public sector projects that have overshot their schedules, according to the Project Implementation division of the Ministry of Statistics and Programme Implementation (MOSPI). It was a year marked by stimulus packages and easier credit and yet the fiscal ending March 2010, saw the Government's project completion track record only slip compared with a year ago. The number of Central projects across various sectors that were actually completed during 2009-10 stood at a dismal 97; a mere 17 per cent of the total 557 projects due for completion that year. Last year was much better – 124 projects or one-third of the 429 projects due for commissioning were actually completed. The Project Implementation Status Report of Central Sector Projects is a quarterly report published by the MOSPI. Time overruns continue Central Government projects have been perennially troubled by delays in implementation due to a variety of reasons such as fund constraints, land acquisition problems, delay in supply of equipment and law and order issues. As of March 2010, 478 of the 1,005 projects monitored, or one-half of the universe, witnessed slippages. Sectors such as roads, railways, coal, petroleum and power continued to face steep time overruns on projects, even after schedules for completion were revised. Delays in coal projects under implementation have worsened, with 54 of the 128 projects facing time overruns of anywhere between 5-192 months. The telecom sector too saw delays in nearly two-thirds of the 48 projects. However, on the positive side, the proportion of projects that overshot their time schedule fell in sectors such as steel, petroleum, shipping and ports. Interestingly, while one would expect the project costs too to go out-of-kilter as a result of the time overruns, especially with the steep inflation of 11 per cent in FY-10, projects seem to have managed well on this front. The percentage of cost overruns (anticipated increase in costs to original estimates) stood marginally higher at 14.7 per cent in March 2010, from 13.4 per cent in March 2009, not too high. In fact, the Government has managed to reduce the cost overruns over the years. In March 2004, this number stood at over 20 per cent. Only a handful of projects in each sector saw an increase in anticipated costs; these were in capital intensive ones such as coal, power, petroleum and roads