Importance of Project Appraisal In Project

Project Appraisal-An organized method of determining if a project or proposal is viable before investing resources. It entails determining whether the project is feasible. It is simply an assessment tool for assessing a project in terms of its economic, social, and financial viability.

Generally performed by a multidisciplinary independent party who is not involved in the project.

General steps for project appraisal:

  • Initial assessment
  • defining problem and long-list
  • consulting and short-list
  • developing options
  • comparing and selecting project

Why did Appraisal need in Project?

It is necessary because of multiple projects competing for limited resources, To choose the best project, Appraisal is crucial.

  • It is done for checking the viability of a project proposal.
  • For detailed pre-investment analysis of the market and technical feasibility; financial soundness, economic desirability, and finally, measuring its investment worth.
  • Decision-making for allocating scarce resources.
  • To ensure scarce resources are put to the most effective use.
  • To determine various costs and benefits of proposed actions.
  • Helps to select the best project alternatives through questioning proposals before resources are allocated.
  • The feasibility study of the proposed project.
  • Overall, leads to the project’s sustainability.
  • Forms as the guideline for the new projects.

Project appraisal is achieved when all the aspects of the project are assessed.

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Aspects of Project Appraisal

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