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Circulation of Revised formats of EFC/PIB Memorandum Dated 09th March, 2012(152 KB)
March, 19th 2012
                              No. 1(1)2011-PF.II
                             Government of India
                          Department of Expenditure
                           (Plan Finance-II Division)

                                                 New Delhi, dated 09.03.2012

                             Office Memorandum

Sub: Circulation of Revised formats of EFC/PIB Memorandum.

      The EFC/PIB format was last revised vide O.M. No. 1(8)/PF-II/98
dated 30th October, 1998. A number of amendments have been carried out
since then for incorporating evolving policies and procedures. Need has
been felt for consolidating these changes. Opportunity has been taken to
recast the format for improving its functionality. A copy of the revised
format is circulated herewith with the request that the same may be used
for submitting the EFC/PIB proposals.

                                                             (Meena Agarwal)
                                          Joint Secretary to the Govt. of India


     1. Secretaries of all Ministries/Departments
     2. Financial Advisors of all Ministries/Departments

     3. Advisor (PAMD),
        Planning Commission,
        New Delhi.

1.     Project identification
     1.1 Title of the project/ scheme:

     1.2 Name of the sponsoring agency               (Ministry/   Department/
         Autonomous Body/ Central PSE):

     1.3 Proposed duration of the project

     1.4 Total cost of the project over the proposed duration

2.     Project Status
     2.1 Please indicate which category the project belongs to:
          (a) Continuing scheme from past Plan periods and included in
              current Plan period.
        (b) New Plan Scheme included in the current Plan period

        (c) New Plan scheme not included in the current Plan period
        (d) RCE proposal

     2.2 If project pertains to category 2.1 (a), please summarise the
         benefits already accrued and expenditure already incurred along
         with an independent evaluation of the past performance of the
         project scheme.

     2.3 If the project pertains to category 2.1 (c), please indicate steps
         initiated for obtaining approval of Full Planning Commission.

3.     Justification for the project

     3.1 The justification for taking up/ continuing the project or scheme
         may be provided.

     3.2 The alternatives that have been considered before firming up the
         design     of the project may be stated. (This should also include
         alternate modes of project delivery, e.g. outsourcing PPP etc. that
         have been considered).
       3.3 Please state whether the project proposal has objectives and
          coverage which overlap with projects/ schemes being implemented
          by the same or another agency (Ministry/ Department/ State
          government). In cases of overlap, please state why the project
          scheme needs to be considered as a separate stand alone effort.

4.         Project Objectives and targets

     4.1 The objectives of the project may be mentioned. These objectives
         should flow from the project justification.
     4.2     The expected date of project/ scheme completion may be stated.
            This should be realistic and supported with a chart indicating
            timelines for the important activities, with a critical path analysis,
            identifying the main constraints.

     4.3 The specific targets proposed to be achieved of the project/ scheme
         may be mentioned.           These targets should be necessary
         measurable. These should also be monitor-able, against baseline
         data. The baseline may be indicated.

     5. Project design

     5.1 Briefly explain the project Design. This should include all
         components of the project.

     5.2 In case the project or scheme is location specific, please state the
         basis for selection of such location.

     5.3 if the project involves creation/ modification of structural and
         engineering assets or change in land use plans, disaster
         management concerns as brought out in OM no. 37(4)/PF-II/2003
         dated 19-06-2009 should be assessed. A self-certification in this
         regard may be enclosed with the EFC memo.

     5.4 In case of beneficiary oriented project/ scheme, the mechanism for
         identification of the beneficiary and the linkage of beneficiary
         identification with UID numbers may be indicated as advised in
         O.M. No. 1(3)/PF-II/2001 dated 09.08.2010.

     5.5 Wherever possible, the mode of delivery should involve the
         Panchayati Raj Institutions and Urban Local Bodies. Where this is
          intended, the preparedness and the ability of the panchayats for
          executing the project may be indicated. If exceptions are to be
          made, the reasons may be explained.

     5.6 In case the project involves land acquisition or environmental
         clearances, the specific requirements and the status in this regard
         may be indicated.

     5.7 The legacy arrangements after the scheduled project duration may
         be mentioned. In case the project creates assets, arrangements for
         their maintenance and upkeep may be stated. (For example the
         project assets may be taken over and maintained by the State
         Government/ PRIs; ULBs).

     5.8 Whether the guidelines of Bureau of Energy Efficiency and other
         related guidelines for energy efficient buildings etc. have been
         considered / complied with.
     5.9 Whether the project is secured against natural/ man-made disasters

 like floods, cyclones, earthquakes, tsunamis etc.

6.      Project/Scheme cost

     6.1 Please provide the project cost estimate for its scheduled duration
         along with a break-up of year-wise, component-wise expenses
         segregated into non-recurring and recurring expenses. It may also
         be indicated whether land is needed, if so whether which agency is
         providing for it, and in case the cost of land is to be booked to the
         project, whether it has been included in the estimates.

     6.2 Estimated expenditure on project administration (including
         expenses on consultants, etc.) may be separately indicated.

     6.3 The basis of these cost estimates along with the reference dates for
         normative costing may be provided. The firmness of the estimate
         may be indicated along with the cost components that can vary, the
         factors that could cause the variation and the extent of the expected

     6.4 In case the project/ scheme involves payout of subsidy, the year
         wise expected outgo, up to the last year of payout, may be
     6.5 In case the project/ scheme intends to create capital assets, employ
         specialised manpower or involves other activities that necessitate a
         Recurring Cost of Capital Expenditure (RCCE) (e.g., maintenance
         and upkeep costs of assets, salary costs of manpower, etc.) over
         the lifetime of the asset, such expenditures, on an annual basis,
         may be indicated in the project proposal.

     6.6 It may also be stated whether the agency which would be assigned
         this legacy responsibility has been consulted and has agreed to
         bear the continuing recurring expenditure. (e.g., the State
         governments may need to incur the maintenance and upkeep costs
         of assets created under Plan schemes.
     6.7 The cost towards salary/ fees/ emoluments of the project human
         resources as being proposed should be indicated (procedure for
         seeking approval of the human resource requirements is however
         detailed at para-7 below).
     6.8 The component of the costs mentioned at 6.1-6.7, that will be
         shared by the state governments may be indicated.

     6.9 In the event of fund transfer being made to State Govts/ local bodies
         or other organisations, "grants for creation of capital assets" may be
         indicated separately.
7.       Project Human Resources

     7.1 Please indicate whether the nodal officer directly in charge of the
         project has been identified. Details about his status, past experience
         in executing similar projects and balance tenure left for steering the
         project may also be mentioned.

     7.2 In case posts (permanent or temporary) are intended to be created,
         such proposal may be sent on file to Personnel Division of
         Department of Expenditure separately. Such proposals may be sent
         only after the overall project proposal is recommended by the
         appropriate appraisal body (SFC, EFC, etc.).

     7.3 In case outsourcing of services or hiring of consultants is intended,
         brief details of the same may be indicated. It may also be certified
         that the relevant GFR provisions will be followed which engaging
         the agency/ consultant.
     7.4 In case additional manpower requirement, please indicate the
         phased requirement over the project timeline (i.e. year-wise break-
         up of the manpower requirement)
8.      Project financing

     8.1 The source of financing for the project may be indicated. In case of
         project already included in the FYP, the specific earmarking may be
         mentioned. In case of any deviations from this quantum, the
         sponsoring agency may indicate how the gap will be addressed.
     8.2 The availability of funds in the budget of the present year and the
         requirements projected may be mentioned. In case of any
         deviations, please indicate how the gap will be addressed.
     8.3 If external sources are intended, the sponsoring agency may
         indicate whether such funds have been tied up. In case firm
         commitment is not available, alternate plans for arranging funds
         may be indicated.
     8.4 Whether the funding requirements have been fully tied up with
         Planning Commission may be indicated.

9.      Project viability
9.1      In case of projects which have identified stream of financial returns,
        the financial internal rate of return may be calculated. The hurdle rate
        is considered at 12%.

9.2     In case of projects where financial returns are not readily quantifiable
        (typically social development projects), the economic rate of return
        may be estimated.

10.     Project implementation and monitoring

     10.1 The administrative structure for implementing the project may be
          stated. In case new structures/ entities etc. is by and large to be
          avoided. In case new structures are intended to be created for
          administering the scheme, the details of such structures and
          specific justification for the same may be provided. Such new
          structure should be proposed only it is has been established after
        due analysis, that existing structures cannot be levered for the
        proposed/additional work.

 10.2 A flow chart for the intended fund flow mechanism may be
      indicated. Funds flows for all schemes/ projects in states should
      ordinarily be through the State Government.

 10.3 The monitoring framework for the project/ scheme may be indicated.
      The arrangements for audit of the project may also be stated.

11. Project/Scheme sensitivities

11.1 Any foreseeable constraints/ uncertainties which can affect the
     technical design, costing and implementation of the project may be
11.2 The likely impact of these constraints/ uncertainties on the project
     parameters may be stated. In particular, the sensitivity of the project
     cost, project schedule and project viability towards the possible
     constraints/ uncertainties may be mentioned.
12. Project period

12.1 The expected date of project completion may be stated. This should
     be realistic and supported with PERT chart of the important activities,
     with a critical path analysis, identifying the main constraints.

12.2 The project closure date should be also indicated beyond which
     further government support/ disbursal of funds will not be required.

12.3 A time line for the project deliverables (i.e. measurable deliverables
     phased year-wise) may be included.

13. RCE proposals

 13.1     Details of physical progress achieved and expenditure incurred
          and commitment made so far may be given.

 13.2     Date of latest approved, revised and proposed completion
          schedule of the project along with time overrun and reasons
          thereof may be elaborated.
13.3   Item-wise cost variance between approved (latest) cost and
       revised cost as propose may be given.

13.4   Reasons of increase in cost may be given in the following

(a)    Price Escalation

(b)    Foreign Exchange variation

(c)    Statutory levies

(d)    Change in Scope
(e)    Addition/ deletion
(f)    Under-estimation

(g)    Others (to be specified)
13.5   The underlying justification for increases in cost due to various
       factors may be explained.
13.6   Effect of revision in capital cost estimates on cost of production
       and profitability / viability with reference to earlier approved
       capital cost of the project
13.7   Report of Standing Committee to fix the responsibility for cost
       and time overrun along with action taken report on its
       recommendations may be appended with the EFC/PIB memo.

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