Kathmandu, October 5
The government has decided to provide special price adjustments for public construction contracts.
According to the Ministry of Physical Infrastructure Development, the decision has been made to implement special price adjustments under Section 55(1a) of the Public Procurement Act, 2007.
The ministry said special price adjustments will be provided for petroleum products, bitumen, HDPE pipes, cement and steel, whose prices have risen abnormally due to international conflicts and disruptions in the supply chain. The adjustment will apply to public construction contracts that remained under implementation with a valid performance period even after March 29, based on actual and verified consumption.
Contracts that are executed annually and those without a price-adjustment provision will also be covered if they meet the prescribed criteria. For contracts that already have a price-adjustment provision, the amount payable under the existing arrangement and contract will be deducted, and only the remaining eligible amount will be provided as a special price adjustment.
The ministry said the provision will address price increases caused by extraordinary circumstances rather than normal market fluctuations. Payments will be determined based on actual consumption, verified quantities and applicable prices to prevent double benefits or unnecessary payments.
The decision aims to prevent construction works from being halted, ensure continuity of ongoing development projects and address imbalances in the construction sector fairly, the ministry said.
Construction entrepreneurs had been demanding price adjustments for a long time. The government had also announced the provision in the current fiscal year’s budget.
