Time and Cost Overruns in Infrastructure Projects – UPSC GS3

  • The Ministry of Statistics and Programme Implementation (MOSPI) has released a report that shows the cost overruns and time overruns for various projects.
  • Cost overrun: It is an unexpected change in the project budget that ends up increasing the total project cost.
  • Time overrun: It can be defined as a condition where a project does not complete within the designed schedule.
What are the Key Findings of the report?
  • Larger projects (worth more than Rs 1,000 crore) faced higher cost overruns as the anticipated cost exceeded the original by a quarter.
  • Among all these projects, a third of the total projects faced time overruns.
  • Region-wise: The Northeast region faced the highest cost overruns for central projects.
  • Sectors with high-Cost Overruns: Water, telecom and Railways. For example, in water resources, the anticipated costs were 184% higher than the original cost.
  • The sector with high Time Overruns: Roads and Railways. For example, the average time of delay in Railways was 69 months or nearly 6 years.