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CAG raps navy on delay in shipbuilding and cost over-runs

CAG raps navy on delay in shipbuilding and cost over-runs
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First Published: Tue, Mar 22 2011. 07 36 PM IST
Updated: Tue, Mar 22 2011. 07 36 PM IST
New Delhi: The Comptroller and Auditor General (CAG) has said that the navy is facing huge shortfalls in its fleet strength and massive cost over-runs, as against its planned fleet levels and cost structure.
In a report on the indegenous construction of Indian naval warships released on Tuesday, the CAG said that by 2012, the navy may retain only 61% of its envisaged force levels for frigates; the figure for destroyers and corvettes stands at 44% and 20% respectively.
“Till date only one frigate of Project 17 has been commissined as against the expected nine ships by August 2010,” the report said. “Even after a decade, shipyard efficiency has not improved. The delays are primarily due to delay in finalization of the structural drawings, timely availability of steel, and inadequate infrastructure of the Defence Public Sector Unit (DPSU) shipyards.”
The CAG has further chided the government on cost escalation due to “poor cost estimation,” “The costs presented to the cabinet committee on security (CCS) were simplistic, ad-hoc and based on incorrectly estimated build period. The planned weapon and equipment package were also prelimnary and at best indicative,” the report said.
The CAG has noted that the cumulative approved costs of two key projects-Project 17 and Project 15A- have more than trebled from Rs 5830 crores to Rs. 19763 crores. “A professional mechanism does not exist to provide reliable and accurate data regarding costs, to the decision making authority,” the report noted.
The report further notes that the “lack of readiness” of the shipyards and “exhaustive modifications” of various sorts, have delayed ship construction. “Certain equipments/systems have been approved for use in the ships despite their non-compliance with technical requirements formulated,” the report noted.
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First Published: Tue, Mar 22 2011. 07 36 PM IST