Indecisiveness of Railway Administration Led to Huge Cost Escalation in Hajipur-Sagauli New Line Project

The Hajipur-Sagauli New Line project, sanctioned in 2003-04, witnessed a significant cost escalation due to indecisiveness of the Railway Administration. The PAC report highlights the importance of prudent decision-making and timely payments to avoid avoidable extra expenditure in infrastructure projects.

The Hajipur-Sagauli New Line project, initially sanctioned in 2003-04 at an estimated cost of Rs 24.66 crore, has witnessed a staggering cost escalation of Rs 2,066.78 crore in January 2019. This significant increase in project cost has been attributed to the indecisiveness of the Railway Administration, as highlighted in a recent Public Accounts Committee (PAC) report.

PAC Report Highlights Lapses in Land Acquisition

The PAC report, titled "Loss due to indecision of Railway Administration in the matter of land acquisition: East Central Railway," was tabled in the Lok Sabha on Wednesday. It draws upon findings from a 2021 Comptroller and Auditor General (CAG) report. The report underscores the lack of prudent decision-making and timely payments by the railways, resulting in avoidable extra expenditure. It emphasizes the importance of meticulous financial planning and adherence to land acquisition policies.

Project Overview and Cost Escalation

The Hajipur-Sagauli New Line project, sanctioned by the Ministry of Railways, involves four districts of Bihar: Vaishali, Muzaffarpur, East Champaran, and West Champaran. The project initially estimated at Rs 24.66 crore underwent subsequent revisions. In January 2019, a Revised Estimate-cum-Material Modification amounted to Rs 2,066.78 crore, reflecting a substantial cost escalation.

Scrutiny Reveals Mismanaged Land Acquisition

The PAC's scrutiny has revealed a protracted and mismanaged land acquisition process in East Champaran. Despite repeated requests from State authorities, the Railway Administration failed to deposit Rs 58.76 crore in 2006, deeming it an exorbitant amount for acquiring 962.59 acres of land. The report indicates that the railways initially cited insufficient fund availability, leading to delayed payments for land acquisition.

Recommendations for Robust Financial Planning

The report emphasizes the need for the Ministry of Railways to implement robust financial planning mechanisms to prevent such drastic cost escalations in the future. It highlights the importance of timely allocation and disbursement of funds to avoid delays and additional costs.

Discrepancies in Ministry's Responses

The PAC noted discrepancies in the Ministry's responses regarding the reduction in land requirement and the subsequent cost implications. The Committee has urged the Ministry to ensure consistency in their explanations and provide detailed justifications for changes in project parameters to uphold transparency and accountability.

Thorough Review of Land Acquisition Procedures

The Committee observed a series of lapses and mismanagement in the land acquisition process, particularly in East Champaran. Consequently, the Committee recommends that the Ministry conduct a thorough review of land acquisition procedures to ensure adherence to land acquisition policies. This review aims to prevent delays, disputes, and cost escalations in all future projects.

The Hajipur-Sagauli New Line project serves as a cautionary tale, highlighting the consequences of indecisiveness and mismanagement in railway projects. The PAC report underscores the importance of prudent financial planning, timely payments, and adherence to land acquisition policies to prevent avoidable cost escalations and ensure efficient project execution.