CONCEPT OF PROJECT
The term “project” connotes programme of action. Project is always interwoven with all socio- economic and cultural activities the project involves a scheme and a speculative imagination.
The kinds of projects
1. Agricultural projects- relating to
- Land development
- Irrigation
- Soil- conservation
- Fertilizers, and
- Seeds etc.
2. Research projects
Definition of “Project”- According to World Bank, project can be defined as “An approval for a capital investment to develop facilities to provide goods and services”.
Little and Mireless defines project as “A scheme or a part of scheme for investing resources which can be reasonably analyzed and evaluated as an independent unit”. “It is an appraisal for investment with the definite aim of producing a flow of output over a specific period of time”.
Gittinger has defined it as the whole gamut of activities involved in using resources to gain benefits.
According to Dr. Albert O. Hirchman” The development project connotes purposefulness, some minimum size, a specific location, the introduction of something qualitative new, and the expectation that a sequence of further development will be set in motion”.
Project can be defined as a scientifically evolved work plan devised to achieve a specific objective with a specified period of time. The three basic attributes of a project are
- A course of action
- Specific objectives, and
- Definite time perspective.
CLASSIFICATION OF PROJECTS
Establishment of a new business unit to manufacture some product or arrange for the distribution of products of another company poses a challenge to the entrepreneur.
- Helps in expressing and highlighting the essential features of the project.
- Project includes all activities aimed at:
- Increased production of goods and/ or services.
- Increasing the capability of existing projects and
- Increasing the productivity of these goods/ services.
The projects can be classified as under:
1. Quantifiable and Non- quantifiable projects
- Quantifiable projects- quantitative assessment of benefits can be made. Concerned with industrial development, power generation, and mineral development.
- Non- quantifiable projects- where quantitative assessment is not possible. Concerned with health, education, defense etc.
2. Sectoral Projects
In India planning commission has accepted the Sectoral basis as the criterion for classification
- Agriculture & Allied sector
- Irrigation and power sector
- Industry and Mining sector
- Transport and communication
- Social service sector
- Miscellaneous
Useful in resource allocation at macro level
3. Techno- Economic Projects
Based on their techno- economic characteristics
(a) Factor intensity- oriented classification
- Capital intensive
- Labour- intensive
(b) Causation-oriented classification
- Demand based or,
- Raw materials based
Dominant reasons for starting a project
- Non- availability of certain goods or services and consequent demand for such goods or services.
- Availability of certain raw materials, skills or other inputs.
(c) Magnitude- oriented classification- based on the size of the investment.
- Large- scale.
- Medium- scale.
- Small- scale.
Techno- economic classification facilitates the process of project feasibility appraisal.
4. Financial Institution Classification
All India and state financial institutions classify projects according to their age, experience and the purpose.
- New projects
- Expansion projects
- Modernization projects
- Diversification projects
These projects are invariably are profit- oriented.
5. Services Projects
- Welfare projects
- Service projects
- Research and development projects
- Educational projects
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