Kathmandu, June 15

Deputy Prime Minister and Finance Minister Bishnu Poudel has termed the construction industry a 'pillar' of prosperity and praised the pace of ongoing construction works even in adverse situation caused by the COVID-19 pandemic.

During his meeting with the Federation of Contractors' Associations of Nepal today, Deputy Prime Minister Poudel said a prosperous Nepal could not be imagined without the construction business. Advising the delegation to ensure quality deliveries on time, the DPM was of the view that the trend of bidding low for tender should end.

He pledged to take all possible initiatives to implement FCAN's submissions in relation to the budget for fiscal year 2021-22.

The FCAN delegation has sought automatic extension of deadline for all construction projects by mid-November, bearing in mind the impact of COVID-19 pandemic on the construction sector.

Two major working seasons could not be utilised due to the COVID-19 crisis, rains and the subsequent festivals, FCAN said, adding that a period from mid-November to mid-July would be appropriate for undertaking construction works. In the case of construction projects requiring a deadline till mid-July 2022 and beyond, the deadline should be extended as per the need on the basis of technical confirmation, it asserted.

Contractors said there would not be any loss to the state if cent per cent bank guarantee is returned rather than a provision of returning 50 per cent bank guarantee as mentioned in the budget.

According to FCAN, the amount kept in the bank would come to the market, which would help both the government and contractors.

The FCAN suggested that the provision of deduction of fees, fines and additional charges should be clearly implemented by the Inland Revenue Office through the Ministry of Finance in accordance with the Income Tax Act 2001, Value Added Tax Act 1995 and Excise Duty Act 2001.

It also urged the finance minister to clearly stipulate the facility of refinancing by adding the limit of contract loan keeping small and middle-scale contractors in mind as it would be difficult to meet expenses since development works were not possible this year too due to the prohibitory order following COVID-19.

The FCAN has also requested the government to include the construction industry among beneficiaries of the two per cent interest reduction on the loan invested in the construction industry, the facility provided as relief to the hardest-hit industries, in the context of development construction works not making headway due to the adverse situation created by the COVID-19 pandemic.

A version of this article appears in the print on June 16, 2021, of The Himalayan Times.