Financial Daily from THE HINDU group of publications
Saturday, Nov 30, 2002
Industry & Economy - Infrastructure
Approval, implementation norms for projects in for overhaul
NEW DELHI, Nov. 29
THE system of approval and implementation procedures for public sector projects is in for a complete overhaul in a bid to avoid time and cost overruns that have been plaguing almost all such projects throughout the country.
In effect, henceforth, all projects funded by the Centre and States will be subject to a new pattern of yardsticks, particularly with regard to the mandatory preparation of detailed projects reports (DPRs). The new scrutiny mechanism for approval and implementation will hold good for Centrally-funded projects, including infrastructure and construction, as also those in the social sector.
This follows the Centre's acceptance of the recommendation of the `Govindarajan Committee Report on Reforming Investment Approvals and Implementation Procedures' which was submitted to the Government earlier during the current fiscal. An exercise is now on to devise ways and means of streamlining the recommendations for implementation.
According to Government sources, a Committee of Secretaries (CoS), headed by the Cabinet Secretary, is slated to meet shortly to iron out the differences of opinion that surfaced on certain issues during deliberations earlier at its two meetings.
The need for a thorough change in the system of approval and implementation of public sector projects, sources said, was felt necessary in view of the inordinate delay - both time and cost overruns - in the completion of scores of medium and mega infrastructure projects in the field of power, construction and irrigation involving a total investment running to a few thousand crore of rupees.
Sources said that a random sample check of some of these projects showed that the major reason for the delay or non-completion was "faulty" implementation which could be traced back to "faulty or insufficient" planning at the DPR stage itself. Also, the Govindarajan Committee had recommended the formation of a `Central Evaluation Unit' for monitoring the progress of project implementation by transferring the Project Evaluation Organisation (PEO) in the Planning Commission to the Ministry of Statistics & Programme Implementation (MoSPI). To ensure that such hitches do not occur during the project implementation stage in future, the post-evaluation report of similar projects undertaken earlier and the lessons learnt from them will now have to be compulsorily included as an integral part in all DPRs for all projects where public funds are involved. Specifically, the project DPRs would have to indicate as to how the "past mistakes" would be avoided.
During its earlier meetings on the Govindarajan Committee report, the CoS discussed the recommendations, particularly with regard to the preparation of DPRs for social sector projects. The Govindarajan report had recommended mandatory preparation of DPRs for social sector projects as well, costing Rs 25 crore and above. In this regard, the representative of the Ministry of Rural Development had opined that there was no need for revising the existing approval mechanism and making the preparation of DPRs mandatory, following which the CoS decided to recommend DPR preparation for social sector projects costing Rs 50 crore and above.
However, a major hitch still remains - - which involves the two monitoring bodies, the Planning Commission and the Ministry of Statistics & Programme Implementation (MoSPI).
During the discussions, the Planning Commission had expressed the view that it would be "more appropriate" if the monitoring unit of the MoSPI is transferred to the Commission.
Stories in this Section
The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription
Group Sites: The Hindu | Business Line | The Sportstar | Frontline | Home |
Copyright © 2002, The
Hindu Business Line. Republication or redissemination of the contents of
this screen are expressly prohibited without the written consent of
The Hindu Business Line