Case-by-Case, Project-by-Project Approach for Infrastructural Challenges in India
Overrunning of costs and delay in completion of infrastructure projects are crucial issues not only for the government but also for citizens, investors, and businesses in India. It causes some sort of inconvenience to all those involved.
The Ministry of Statistics and Programme Implementation monitors infrastructure projects worth Rs 150 crore and above. Of the 1,680 such projects, 438 reported cost overruns, and 539 were delayed. As many as 438 infrastructure projects, each worth Rs 150 crore or more, have been hit by cost overruns totalling more than Rs 4.34 lakh crore, according to a report. The average time overrun in these 539 delayed projects is 47.16 months.
Reasons for time overruns as reported by various project implementing agencies include delay in land acquisition, delay in obtaining forest and environment clearances, and lack of infrastructure support and linkages.
Delay in tie-up for project financing, delay in finalisation of detailed engineering, change in scope, delay in tendering, ordering and equipment supply, and law and order problems are among the other reasons along with state-wise lockdowns due to COVID-19.
It has also been observed that project agencies are not reporting revised cost estimates and commissioning schedules for many projects, which suggests that time/cost overrun figures are under-reported, it added.
What could be a way out?
When you see the reasons for the delay and even the underestimation of overrun costs, many of them are either related to state laws or are related to the local authority. And, a way out precisely lies here…
One size does not fit all is applicable to these projects as they are not all in one category, or type of projects, nor in one state. Firstly, there is a need to understand the in-depth challenges for each project.
Secondly, and most importantly, the approach to deal with these challenges should be shifted from macro to micro. As in, after understanding the individual projects in detail, the authority of the Central Government can formulate a task force or a group of people wherein each one of them would be assigned with a state and infrastructure initiatives of the centre in that particular state. The state would be a case and a particular construction would be the project.
Thirdly, the individuals assigned this task should discuss, and collaborate with state governments and local authorities, and seek to solve the issues. According to state laws, revenue gaps, and environmental conditions, when a case-by-case and project-by-project approach would be adopted it would lead to actually resolving the issue and also lead to utilising the remaining time of construction in a proper way with minimum wastages of resources. This will help in understanding and solving ground-level problems, it will save time and money spent by the government due to delays and cost overruns, and boost cooperative federalism structure. Timely building of infrastructure projects would help the economy attain growth and development of all regions as expected by the multimodal national connectivity plan, Gati Shakti announced by Prime Minister, Narendra Modi.
Ms. Vaibhavi Pingale is a Visiting Faculty of Economics at Gokhale Institute of Politics and Economics, Pune & at Savitribai Phule Pune University. She is pursuing her PhD. She has been actively writing media articles other than academic research.