RISK MANAGEMENT IN CONSTRUCTION INDUSTRY

A study conducted by Infrastructure & Project Monitoring Division of Ministry of Statistics and Programme Implementation reports that out of 860 central sector projects (which are of the order of more than Rs.204.2 million) costing around Rs.3432 trillion and average project duration of 6 to 7 years, about 35% are behind schedule and the delay ranges from 1 to 195 months. Time and cost overruns are a result of delays in project execution. Some of the reasons advanced for these delays and subsequent overruns in time are inclement weather, shortage in labour and material supply, sub-contractors, changes after contract execution has commenced, poor site management and government policies. The delay in a project is also due to the poorly drafted contract clauses. Identification of the contract clauses that affect the schedule of the construction project was which taken up by CPWD has been carried out in this study.

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