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    Problem of Time & Cost

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    Tamanna Thakur
    The document discusses problems of time and cost overruns in various public sector projects in India. It provides an overview of key terms related to cost overruns and opportunity costs of delays. It then lists 10 sectors - atomic energy, civil aviation, coal, steel, petroleum and natural gas, power, railway, road transport and highways, telecommunication, and urban development - and identifies specific reasons for time and cost overruns within each sector. Common reasons include issues with land acquisition, availability of funds, supplies and contractors, geological challenges, and lack of coordination between government authorities.

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    Problem of Time & Cost

    Uploaded by

    Tamanna Thakur
    2K views14 pages
    The document discusses problems of time and cost overruns in various public sector projects in India. It provides an overview of key terms related to cost overruns and opportunity costs of delays. It then lists 10 sectors - atomic energy, civil aviation, coal, steel, petroleum and natural gas, power, railway, road transport and highways, telecommunication, and urban development - and identifies specific reasons for time and cost overruns within each sector. Common reasons include issues with land acquisition, availability of funds, supplies and contractors, geological challenges, and lack of coordination between government authorities.

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    The document discusses problems of time and cost overruns in various public sector projects in India. It provides an overview of key terms related to cost overruns and opportunity costs of delays. It then lists 10 sectors - atomic energy, civil aviation, coal, steel, petroleum and natural gas, power, railway, road transport and highways, telecommunication, and urban development - and identifies specific reasons for time and cost overruns within each sector. Common reasons include issues with land acquisition, availability of funds, supplies and contractors, geological challenges, and lack of coordination between government authorities.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    2K views14 pages

    Problem of Time & Cost

    Uploaded by

    Tamanna Thakur
    The document discusses problems of time and cost overruns in various public sector projects in India. It provides an overview of key terms related to cost overruns and opportunity costs of delays. It then lists 10 sectors - atomic energy, civil aviation, coal, steel, petroleum and natural gas, power, railway, road transport and highways, telecommunication, and urban development - and identifies specific reasons for time and cost overruns within each sector. Common reasons include issues with land acquisition, availability of funds, supplies and contractors, geological challenges, and lack of coordination between government authorities.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    of 14
    At a glance
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    The passage discusses various reasons for time and cost overruns in different sectors of public sector projects such as delays in supplies, land acquisition issues, funding constraints, etc.

    Common reasons mentioned include delays in supplies, land acquisition problems, funding constraints, geological surprises, law and order issues, technology availability, etc.

    The atomic energy sector faces issues with exchange rate variations leading to increased costs and delays in supplies from foreign vendors.

    Problem of Time & Cost overrun

    Overview
    Delays and cost overruns in Public Sector investments can raise the capital-output ratio in the sector and elsewhere, bringing down the efficacy of investments. Cost overrun = Ca - Co Co : Original estimated cost of project (Rs. crores) Ca : New anticipated cost of project (Rs. crores) Opportunity cost of delay = opportunity cost of the extra capital tied up in the projects.

    Specific Problems for Time and Cost Overruns

    Specific Problems for Time and Cost Overruns


    Sl.No. Sector Specific reasons for time and cost overrun In the Atomic Energy the cost increase in projects is due to exchange rate variation and delay in supplies from foreign vendors. Delay in civil works is due to locational problems.

    Atomic Energy

    Specific Problems for Time and Cost Overruns


    Sl.No. Sector Specific reasons for time and cost overrun Most of the projects in the Civil Aviation Sector are modernization projects. The main reasons for delay is availability of adequate land and funds causing delay in modernization of non-profit airports.

    2.

    Civil Aviation

    Specific Problems for Time and Cost Overruns


    Sl.No. Sector Specific reasons for time and cost overrun
    A number of Coal projects are under expansion and these projects are being funded from internal resources of the Coal Companies which is causing constraint in timely completion of expansion projects. Since Coal projects are location specific, the problem of land acquisition and rehabilitation is a major constraint.

    3.

    Coal

    Specific Problems for Time and Cost Overruns


    Sl.No. Sector Specific reasons for time and cost overrun
    Major modernization activities have been taken to expand the capacity of existing plants. Due to very heavy pressure on vendors and suppliers because of large construction activities all over the world, supplies are getting delayed. Delay in award and availability of suitable contractors for carrying out major activities is also causing delay in implementation.

    4.

    Steel

    Specific Problems for Time and Cost Overruns


    Sl.No. Sector Specific reasons for time and cost overrun
    The Refineries which are under expansion are facing supply problems from indigenous as well as foreign vendors. The refineries which are being expanded for clean fuel production are facing constraints in redesigning their fluidized catalytic units which require shut down of their plants for a longer period. In the development of oil exploration, projects encountered delays mainly due to geological problems.

    5.

    Petroleum & Natural Gas

    Specific Problems for Time and Cost Overruns


    Sl.No. Sector Specific reasons for time and cost overrun
    The Power projects particularly, Hydro-electric projects are suffering delays due to law and order problems in the North East and in Kashmir. Some projects are also facing problems of geological surprises. Non-availability of contractors in difficult areas is posing a threat to timely completion of projects in Power Sector.

    6.

    Power

    Specific Problems for Time and Cost Overruns


    Sl.No. Sector Specific reasons for time and cost overrun
    The major problem of Railway Sector is the non-availability of adequate funds for large number of New Line, Gauge Conversion, Doubling projects. A number of projects are also facing land acquisition, rehabilitation problems due to lack of proper response from the State Governments.

    7.

    Railway

    Specific Problems for Time and Cost Overruns


    Sl.No. Sector Specific reasons for time and cost overrun
    Projects are delayed mainly due to basic reasons like land acquisition, realignment of public utilities like water supply, power supply line etc. A number of projects have suffered due to lack of proper response from the State Government authorities. Some projects have been delayed due to delay and slow progress made by the contractors requiring award of the contract afresh.

    8.

    Road Transport & Highways

    Specific Problems for Time and Cost Overruns


    Sl.No. Sector Specific reasons for time and cost overrun
    In the Telecommunication Sector projects are delayed due to lack of proper coordination and in some cases timely availability of equipment and material. Since Telecommunication is very technology intensive, availability of required type of experts and material is also causing delays.

    9.

    Telecommunication

    Specific Problems for Time and Cost Overruns


    Sl.No. Sector Specific reasons for time and cost overrun
    The Urban Development projects are mostly of civil construction nature and they are being carried out by CPWD on behalf of the administrative Ministries. Improper contract monitoring and follow up causes delay in civil work projects.

    10.

    Urban Development

    END OF CHAPTER

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