60% smart city projects in Karnal, Faridabad faced delays: CAG report

Almost 60% of the 112 development projects under the Haryana Start City Mission implemented in Karnal and Faridabad have experienced delays ranging from a few days to more than four years due to lack of encumbrance-free sites, site clearance, and drawing reviews, the Comptroller and Auditor General of India (CAG) report tabled on the first day of the Haryana session.

The Union Ministry of Housing and Urban Affairs (MoHUA) launched the Smart Cities Mission (SCM) in June 2015, under which two cities in Haryana – Faridabad (May 2016) and Karnal (June 2017) – were selected for a period of five years (2015-16 to 2015-16 to 2015-2020), but was extended to March 2019.

The mission aimed to develop cities focused on core infrastructure, resident well-being, environmental sustainability and the integration of smart solutions.

The report states that the nodal agencies for the implementation of the mission in Karnal and Faridabad are the special purpose vehicles (SPVs) created specifically for each city – Karnal Smart City Limited (KSCL) and Faridabad Smart City Limited (FSCL) – which functioned under the administrative control of the Urban Local Bodies (ULB) department.

Against planned funds of ₹3,896 cr, current mobilization of funds was ₹1,825 kr

The agency noted that against planned funds of ₹3,896.82 crore, the current mobilization of funds was ₹1,825.86 crore for two cities which have a deficit of ₹2,070.96 crore (53.15%). FSCL and KSCL may increase ₹980 crore (37.67%) and ₹845.86 crore (65.27%) mainly through government grants against proposed funding of ₹2,601.01 crore and ₹1,295.81 crore respectively.

According to the report, Karnal has identified an area-based development (ABD) area of ​​720 acres around Ghanta Ghar Chowk, Kunjpura and Mughal Canal Market with modern smart amenities and transformed it into a light house for the city. The SPVs also planned to implement ₹253.22 crore projects under convergence with schemes of Centre/State Government but KSCL could only four projects of ₹12.86 crore under convergence with Karnal municipal corporation (MC).

The report also highlighted that Faridabad and Karnal failed to raise any funds against planned receipt of ₹12.13 crore of debt and ₹82.74 crore from additional contribution from Karnal MC.

SPVs were able to complete only 45 out of 112 projects on time

The timelines for the completion of 152 projects (FSCL: 48 and KSCL:104) out of the total of 167 projects were decided by both the SPVs and for remaining projects the timeline was not fixed as the same were in the planning stage.

Furthermore, out of the 112 completed projects, the SPVs were able to complete only 45 projects (FSCL: 7 and KSCL: 38) according to the timelines and there were delays in the completion of the 67 (60%) projects (FSCL: 28 and KSCL: 39) ranging from three to 1,506 days, according to the report.

In its reply, the department said that the projects are brownfield projects and were put back into the existing infrastructure created before the implementation of SCM, which faced various challenges such as relocation of existing utilities, consultation with various departments, Covid lockdown and CAQM directions. It was also said that the issue of delay has been recognized by the Union Government and as a result the completion period has been extended till March 2025.

Flag of delay in construction of commercial complex at old Anaj Mandi in Karnal on MC land at a cost of ₹30.80 crore (September 2021), the audit observed that the project was awarded without finalization of drawings and design, and the same could be finalized only in November 2023, and consequently excavation work could start only in October 2023.

The CAG also noted that the monitoring mechanism at the city level was deficient as both held only 10 meetings of the monitoring committee against the requirement of 133 meetings. The SPVs also failed to appoint any agency for conducting third party review/impact assessments of the projects executed and did not conduct any assessment in terms of success parameters. The department said that the assessment will be carried out after completion of the Mission.