Prime Minister's Kashmir Package Lags Behind, Suffers Cost Overruns

Prime Minister's Kashmir Package Lags Behind, Suffers Cost Overruns

24 October 2011
The Economic Times
Masood Hussain

Srinagar: Even a priority scheme like the Prime Minister's Reconstruction Plan (PMRP) for Jammu & Kashmir suffers monetary losses due to cost overruns. The plan was estimated to cost around Rs 24,000 crore when Manmohan Singh announced it in November 2004. However, time overruns have escalated costs to Rs 33,177.85 crore, of which only Rs 11,146.21 crore has been spent by August 2011. It has now been extended by one more year and officials involved in its implementation suggest that the plan needs to continue without deadlines since it envisages a number of projects with long gestation periods. The entire 'package' was reviewed by a high-powered central officers' delegation led by cabinet secretary Ajit Kumar Seth. 'There was a consensus that the PMRP implementation should get spilled over to next financial year,' a senior officer who was part of the review meeting said. 'But there will be many projects that would take as much as 10 years for implementation, especially those falling under the central government agencies.' PMRP has three sectors with different implementation systems in place. Some projects were given directly to the state government for implementation, which make 18.68% of the total plan. Projects falling under the central government were divided into two parts - one part, which constitutes 19.11% of PMRP, is being implemented by various state government agencies on behalf of the Centre and the other part is directly handled by the central government institutions, mostly NHPC and BRO. Initially, the state government was asked to implement projects worth Rs 3,984.40 crore. As the government started adding projects to the state sector under PMRP, it now has Rs 6,199.66 crore to spend. By now it has implemented projects worth Rs 4,349.71 crore, which makes achieving a target of 70.16%. From the central sector projects, the state government was given projects worth Rs 4,731.37 crore for implementation in the state which was later increased to Rs 6,341.35 crore. There is, however, a progress of only 24.61% in these projects. Government officers said this is because three major JNNURM projects were facing crisis and they were added to the PMRP for review at a much later stage. Besides the Rs 552 crore for augmentation of drinking water in the Jammu city, it includes sewerage and drainage systems for Jammu and Srinagar cities that costs Rs 1,741 and Rs 1,470 crore, respectively. PMRP was targeted at improving the infrastructure facilities across J&K with emphasis on power. Over the years, it has evolved as a peculiar developmental model that has the flexibility of accommodating even Centre-sponsored schemes (which are usually part of routine state plans) making it more a supervisory exercise rather than actual investment. Schemes of additional roads near the Chinese border started by the defence ministry earlier and projects that NHPC had taken over from J&K much earlier also form part of the Reconstruction Plan. Ever since it was announced, J&K government gets part of the PMRP funds that are accommodated in the yearly budget. For the current fiscal it has Rs 1,200 crore of funds coming under PMRP. It is the central sector projects being implemented by the central government agencies that make most of the PMRP. Initially it was supposed to be worth Rs 14,630.85 crore but this has increased to Rs 20,636.84 crore.


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