ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Public Sector-Money Illusion

to a newspaper report, asked the Bureau of Public Enterprises to make a study of cost over-runs in public sector projects and of delays in their completion. According to the same report, for a sample of 14 public sector projects, as against the original cost estimate of Rs 1,033 crores, actual expenditure turned out to be Rs 1,494 crores or an over-run of almost 45 per cent, All except one of the projects also lagged far behind their original completion schedules, the delay varying from as much as 100 months (in respect of the basic chemicals unit of Hindustan Organic Chemicals) to just one year (the Ponimalai Iron Ore Project in Karnataka). The largest of these projects was the first stage of the Bokaro steel plant, the revised cost of which was Rs 310 crores higher than the original estimate of Rs 671 crores. Also, the project was completed six years behind schedule.

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