economics of on-farm development - Institute for Social and ...

escalatio.n in the process o.f irrigation develo.pment The \arious components In cost
escalation in the case 0.1' f!\t: irrigatio.n projects han: been compared as sh,'" n in
table 5.16.
Table 5.16: Majo~ factors causing cost escalation ("!o)
SQurces <strong>of</strong> cosl escalatioll
!
,
Periyar Chittur
Pa::hassi Kalljlru·
Kuttiadi
"ulley -pu=ilO project Pu=hll
Rise in cost <strong>of</strong> labour & material 48.1 38.7 47.0 43.0 52.1
Inadequate financial provision 44.1 ~0.7 20.6 8.1 22.4
Inadequate investigation 1.7 4.0 5.1 11.9 4.2
Chanue in design 4.7 1.6 I 13.7 21.2 3.8
Cost <strong>of</strong> land 0.1 20.2 13.5 15.8 7.S
Others 1.3 14.8 0.1 0 10.0
Total ]00 100 100 100 100
Source: Compiled from Netto (1990).
It is evident that the costs o.f labo.ur and materials have been the maJo.r
so.urces <strong>of</strong> cost escalation in these five projects. ranging between 38 per cent in
Chitturpuzha project \(1 52 per cent in Kanjir~lpuLha irrigation pWJt:ct \\'hik
inadequate financial pro.vision has been the second major factor leading til cost
escalatio.n in projects. viz .. Periyar Valb (44 %). KanjirapuLha (22 %j.
Chitturpuzha (20.7 %) and Kuttiadi (20.6 %). tht: cost o.f land acquisition has been
significant in rcspt:ct <strong>of</strong> Chitturpuzha (20.2 %J. l'aLhassi (15.8 %) and Kuttiadi (I ~.5
%). Other factors contributing to cost escalation have been change in design and
inadequate investigatio.n <strong>of</strong> the schemes.
Upward revision in estimates
As an outco.me <strong>of</strong> the rise in costs <strong>of</strong> land acquisition. labour and material costs. it is
ob~ious
that frequent revisions in the estimates <strong>of</strong> irrigation projccts had takt:n
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