Construction Entrepreneurs Federation Chairman Pandey Expresses Confidence in Public Procurement Act Amendment

Kathmandu. Chairman of the Federation of Construction Entrepreneurs of Nepal, Nicholas Pandey, has expressed confidence that the second amendment to the Public Procurement Act will benefit not only construction entrepreneurs but the entire state machinery. Speaking at a program organized to mark 100 days in office, Chairman Pandey stated that the reforms in the act will help invigorate the country's economy. According to Chairman Pandey, construction entrepreneurs also had a share in the low capital expenditure in the past. He said that due to the tendency to bid up to 40 percent below the tender process, the state's spending capacity was reduced proportionally, which slowed down the economy as sufficient money did not enter the market.

To solve this problem, he claimed that the new act has implemented 'average bidding' and 'rated criteria' for complex tasks, which will now increase the state's spending capacity. Pandey alerted that delays caused by obstacles at the project site such as tree cutting, environmental impact assessment (EIA), and relocation of electricity poles are causing billions in losses to the state.

He mentioned that due to construction delays caused by such technical obstacles, national and international construction entrepreneurs have resorted to arbitration against the state, claiming billions in compensation, and in some cases, the state has been ordered to pay that amount. He stated that the new procurement act addresses such legal and technical hurdles. Pandey said that the act has also been reformed to protect small construction entrepreneurs from exploitation and 'blackmailing' by the bureaucracy.

He mentioned that due to technical documents in English (SBD), employees used to mislead some small entrepreneurs and get them to sign documents for freezing price increases or imposing unnecessary financial burdens, and informed that such actions will now be invalid and guilty employees will be punished.

Pandey stated that he had personally brought to the attention of the Prime Minister that the amendment brought through an ordinance earlier was flawed. He clarified that the current second amendment, brought through a replacement bill with the Prime Minister's initiative, is positive and commendable for the construction sector. 

Chairman Pandey said, 'The second amendment to the Procurement Act has greatly benefited not only construction entrepreneurs but also the country. In the past, the government's development expenditure decreased and the economy slowed down due to the tendency to bid at excessively low rates. Now, the provision of average bidding and rated criteria will increase qualified competition and make development expenditure effective. The state had to bear billions of rupees in losses due to delays caused by reasons like tree cutting, EIA, and electricity pole relocation at construction sites. The amended act has made provisions to solve such problems.'

Claiming to have succeeded in resolving some long-standing issues in the first 100 days of his tenure, Pandey said that his main goal in the coming days is to modernize and make the federation technology-friendly.

He emphasized the need to engage in infrastructure development not by relying solely on the state but by using private sector investment and various financial tools. He suggested developing the country through a financing model based on 15-20 year payment models, rather than just looking to the state treasury.