Central Govt Likely To Terminate 116 Infra Projects Worth Rs 1.26 Lakh Crore Due To Long-Term Delays: Report

According to a report, these 116 projects feature in the list of those terminated, on hold, or bound for foreclosure

The central government may shut down about 116 infrastructure projects worth Rs 1.26 lakh crore due to unresolved obstacles ranging from land acquisition to Centre-state tussles, according to a report published by Business Standard on Monday.

Citing an internal report prepared by NITI Aayog, the policy think tank of the government, Business Standard reported that these 116 projects feature in the list of those terminated, on hold, or bound for foreclosure. These may be removed from the Centre’s project-monitoring system, which has been created to expedite infrastructure execution, it said.

“The majority of such projects are from the railways and roads sectors. While in the case of railways, 50 projects have been put on hold (some of them sanctioned 48 years ago) and 15 are yet to be sanctioned, the roads sector has 33 projects lined up for foreclosure, termination, or facing legal issues. Therefore, most of the sunk expenditure incurred is on railways and roads,” the publication has cited NITI Aayog’s report.

As per Business Standard, the said projects have incurred a cumulative capital expenditure of Rs 20,311 crore to the government. Most of these delayed projects will have to be replaced by new ones despite sizeable infrastructure already in place. Many projects continued to saw cost escalation until the government decided to put them to an end.

The cost of stuck railway projects escalated by about 49 per cent to Rs 88,373 crore, as many of them were put on hold for a long-standing period. A total of 72 projects of the railways have seen a cost of over Rs 8,500 crore so far, the report said. On the other hand, the cost escalation for 33 stuck projects at road transport and highways is lower at 6 per cent. These had a higher sunk cost than railways, at Rs 11,000 crore.

According to NITI Aayog, as many as 55 of the 116 projects have been stuck due to land acquisition issues between the Centre and states, and bureaucratic red tape. The ministries concerned have raised issues of state governments either not sanctioning the acquisition of land or not giving the requisite approvals.

Nearly 10 projects have been stalled for years due to states reneging on their cost-sharing agreement.

Some projects have also been delayed due to environmental concerns. Two coal projects, in Chhattisgarh and Madhya Pradesh, may be shelved and removed from the monitoring system because environmental concerns remain unaddressed; there is a sunk capex of Rs 105 crore.

Three projects of the National Highways Authority of India (NHAI) in Tamil Nadu, connecting the Kerala Border to Villukuri and Kanyakumari, have been stalled following environmental concerns raised by the National Green Tribunal (NGT). The projects are now proposed for shelving. Several projects in eco-sensitive areas in the Northeast are also set to be terminated, but no explicit reason has been given, the report added.