India’s restrictions on explosive imports stall Nepal’s development projects

KATHMANDU: India’s recent restrictions on the import of explosives have begun to severely impact Nepal’s development projects, causing significant delays in crucial infrastructure endeavors such as road construction, tunneling, and hydropower projects. The shortage of explosives has brought many construction projects to a standstill, threatening the progress and completion timelines.

Energy promoters and stakeholders in Nepal’s construction sector have raised concerns over the disruption caused by the shortage of explosives, particularly in the construction of hydropower projects requiring tunneling. India’s suspension of explosive supplies for the past two months, citing various reasons, has resulted in project delays and setbacks.

Ganesh Karki, President of the Independent Power Producers’ Association of Nepal (IPPAN), highlighted the adverse impact on hydropower projects, noting that over four dozen projects have experienced delays due to the lack of explosives. He pointed out that the Indian Embassy in Kathmandu, responsible for approving imports, has not issued the necessary No Objection Letters (NOCs), effectively halting the construction of 80 percent of Nepal’s ongoing hydropower projects.

“The reluctance of the Indian Embassy to renew the NOCs has caused significant delays,” stated Karki. “If the supply of explosives remains halted, project costs will escalate, and delays could extend from six months to a year.”

The shortage of explosives has brought the work on multiple hydropower projects, including those in the Dordi Corridor of Lamjung and the Tanahun hydropower project, to a standstill. Both small and large-scale hydropower projects across Nepal are feeling the impact of the shortage, disrupting construction activities.

Explosives are essential for tunneling in most hydropower projects under construction, exacerbating the challenges faced by developers. Additionally, road construction projects under the Department of Roads (DoR) are also experiencing delays due to the scarcity of explosives, according to construction entrepreneurs.

Rabi Singh, President of the Federation of Contractors’ Associations of Nepal (FCAN), affirmed the widespread obstacles caused by the shortage of explosives, emphasizing the critical need for timely supplies to sustain project momentum.

The Department of Roads (DoR) acknowledged the shortage of explosives, particularly for strategic road networks and tunnels, attributing the delay to India’s restrictions. This is not the first instance of India halting explosive supplies to Nepal, with similar disruptions occurring previously.

Singh recalled past delays, including the postponement of the Nagdhunga tunnel construction, due to similar reasons. Despite efforts by the Nepalese Army to produce explosives, the domestic capacity falls short of meeting national demands.

India’s selective prioritization of projects in Nepal, favoring those utilizing its own capital and resources, has exacerbated the situation. Experts note India’s reluctance to support projects with Chinese involvement, contributing to delays and uncertainties in the NOC issuance process.

The prolonged renewal process for NOCs, now taking two to three months longer than usual, threatens to further impede Nepal’s development projects. If this trend persists, project costs will escalate, deadlines will be extended, and Nepal’s development agenda will face significant setbacks.

Fiscal Nepal |
Wednesday May 8, 2024, 11:05:12 AM |

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