Construction materials dear, contractors hit

Kathmandu, May 6:

Soaring prices of construction materials in the recent months have taken its toll on various public construction projects.

The public construction wo-rks worth over Rs 40 billion ha-ve been halted as they were hit by ballooning prices of construction materials.

The private contractors are not in position to continue construction works at those projects, which were awarded them at the then prices, the Federation of Contractors’ Associations of Nepal (FCAN) said today. According to FCAN, the prices of construction materials such as iron rod, cement, aluminium, copper wire, gabion wires and petroleum products have skyrocketed in the range of 25 to 100 per cent in the recent months. “The soaring prices of the construction materials have made the construction works much dearer in the last 10 months,” said Sukunta Lal Hirachan, president of FCAN.

According to FCAN, the contractors in Jhapa, Morang, Sunsari, Makwanpur, Chitwan and Nawalparasi districts have already stopped public construction works such as building roads, drinking water supply and irrigation projects and public buildings. “The contractors are even not willing to take part in bidding process,” said Sharad Kumar Gauchan, general secretary of FCAN.

“The current construction quotation rates were fixed some 10 months ago based on the prices in those days,” said Hirachan, adding that the government must take an immediate initiative to address the issue and review the construction quotation rates as soon as possible.

He warned that the public as well as private construction works worth billions could be severely affected, unless the problems are not addressed immediately. He suggested that the government should immediately call meetings of quotation rate fixing committees in all districts and fix the new rates according to the current market prices.

“In case of ongoing projects, the rates should be adjusted with the quoted prices at the time of contract signing,” Gauchan said, asking the government to extend the period of all projects that have been halted due to soaring prices.

Besides skyrocketing prices of the construction materials, erratic supply has become yet another serious bottleneck in completing the projects on time, he said, adding that the government must look into supply side, too.