Construction Sector Faces Collapse Due to Price Hikes, Federation Submits Memoranda

Kathmandu. The Federation of Contractors' Nepal has submitted memorandums to two ministries on Friday, stating that the construction sector has collapsed due to excessive price increases. The delegation led by Federation Chairman Nicolas Pandey drew the attention of Integrated Infrastructure Development Ministry Secretary Gopal Sigdel and Energy, Water Resources and Irrigation Secretary Sarita Dawadi. The federation stated that the memorandum was submitted as a pressure tactic, as the government has not shown interest even though all projects across the country are on the verge of automatically shutting down. Federation Chairman Pandey said that the construction sector has now reached a 'holiday' state and businessmen are in extreme crisis. The businessmen's demands include adjusting contract prices according to the increased market prices, extending the deadline for stalled projects until June 2084, and ensuring clear budget titles and payment arrangements for projects in the upcoming budget. Chairman Pandey also expressed objection to the crackdown and harassment of businessmen in the name of investigation, stating that it would spoil the investment environment. Chairman Pandey said, 'Currently, there is a situation where it costs more than double to work, and even in such a situation, project chiefs and engineers are writing threatening letters to confiscate bank guarantees and blacklist us.' He mentioned that the price of petroleum products has historically increased due to the tension in the Strait of Hormuz, which has caused the prices of construction materials such as cement, iron, and sand to skyrocket. He stated that they have informed all development ministry secretaries that they are not demanding a 'construction holiday' but that the construction sector has already gone on holiday due to the inability to work. The federation believes that the increase in fuel prices and the shortage of materials like bitumen have directly affected construction work. The businessmen have clarified that until their demands for the government to immediately bring a price adjustment directive and provide relief for the impact of price increases are met, there is no situation to proceed with the work.