Analysis of reasons for cost and time overrun in Indian megaprojects

¹ Post graduate student in Construction Engineering and Management, Faculty of Technology, CEPT University, 380009 Ahmedabad, India
² Associate Professor, Faculty of Technology, CEPT University, 380009 Ahmedabad, India

^* ganesh.devkar@cept.ac.in

Abstract

Megaprojects are becoming increasingly common in developing countries. In India, the need for and trend of rapid infrastructure development has resulted in design and implementation of projects of large scope and size, in terms of complexity and costs. As a result, megaprojects are being implemented in almost all infrastructure sectors in the country. The implementation of a megaproject attracts a lot of attention among the policy makers and researchers owing to their enormous economic, social and environmental impacts. The performance of megaprojects in terms of two key parameters – cost and time - is closely monitored by the Government of India, and this has resulted in the publication a set of reports to disclose information on project progress. Althoughquantitative analyses of the information available in these reports have been performed by the researchers, very few qualitative analysis reports are available. In this context, a qualitative research study has been undertaken in this work, to analyse the reasons for time and cost overrun in megaprojects. The analysis furthers the knowledge on megaprojects implementation by providing inference on not only key reasons for time and cost overruns but also factors and trajectories leading to the manifestation of a particular cause. The analysis indicates that delay in land acquisition, capability of contractors and contractual complexity were the major causes of time and cost overruns and these issues traverse through different layers – policy, institutional and project associated with megaprojects. The study findings are useful to policy makers to design interventions at these three layers for addressing the cause of time and cost overruns, and ensuring effective implementation of megaprojects.