As infrastructure climbs to the top of the political agenda changes are needed to drive real growth
India’s Ministry of Finance describes the economic survey that it publishes each year as its “flagship annual document”. Published a few days before the country’s budget is presented, this survey usually reveals interesting insights into the state of the economy. The Economic Survey for 2013-14, at more than 250 pages, was no exception.
Citing a government status report for February 2014, the Economic Survey says that 41% of major central-sector infrastructure projects – i.e. those initiated by a central government ministry, a central public sector undertaking or statutory authority – have been delayed “with respect to the latest schedule”. The expected overall cost overrun amounts to 21.3% of the original planned cost of implementation.
The survey states that “one of the main reasons for underachievement” of projects is time overruns during implementation. Pre-implementation hurdles such as obtaining regulatory approvals, problems with land acquisition and environmental clearances are described only as important issues, albeit ones that “need immediate attention”.