Sanctioned at 25 cr, cost over 2K cr: Railways mismanaged land acquisition for Hajipur-Sagauli project

New Delhi: The Hajipur-Sagauli New Line project, sanctioned in 2003-04 at an estimated cost of Rs 24.66 crore, registered a huge cost escalation of Rs 2,066.78 crore in January 2019 due to indecisiveness of the Railway Administration, according to a Public Accounts Committee (PAC) report.

Tabled in the Lok Sabha on Wednesday, the report titled 'Loss due to indecision of Railway Administration in the matter of land acquisition: East Central Railway' was based on one of the findings of a Comptroller and Auditor General (CAG) report of 2021.

After carrying out a detailed examination, the PAC observed that the railways' lack of prudent decision-making and timely payments resulted in avoidable extra expenditure, underscoring the importance of meticulous financial planning and adherence to land acquisition policies.

"The Hajipur-Sagauli New Line project, sanctioned by the Ministry of Railways in 2003-04, underwent a series of financial oversights and lapses in land acquisition processes, leading to significant cost escalations," the report said.

"The project involves four districts of Bihar i.e. Vaishali, Muzaffarpur, East Champaran, and West Champaran," it added.

According to the findings of the CAG audit, the project, as mentioned in the PAC report, initially estimated at Rs 24.66 crore, witnessed subsequent revisions, with a Revised Estimate-cum-Material Modification in January 2019 amounting to Rs 2,066.78 crore.

"The Committee'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 the acquisition of 962.59 acres," the report said.

According to the report, the railways cited the problem of insufficient fund availability initially, resulting in delayed payments for land acquisition.

The report emphasises the need on the part of the ministry to implement robust financial planning mechanisms in future to prevent such drastic escalations and highlights the importance of timely allocation and disbursement of funds.

The PAC said that it noted discrepancies in the ministry's responses regarding the reduction in land requirement and the subsequent cost implications.

"Therefore, the Committee desires the Ministry to ensure consistency in their explanations and provide detailed justifications for changes in project parameters to uphold transparency and accountability," the report said.

"The Committee observed a series of lapses and mismanagement in the land acquisition process, particularly in East Champaran. Therefore, the Committee recommends the Ministry to conduct a thorough review of land acquisition procedures to ensure adherence to land acquisition policies, preventing delays, disputes, and cost escalations in all future projects," it added.