Fiscal Nepal
First Business News Portal in English from Nepal
KATHMANDU: The government has started a new plan to fix “sick” construction projects. These are projects where the original contracts were cancelled because work stopped. Now, officials are working to find new builders to finish the jobs. The Ministry of Finance is meeting with other departments to figure out the costs and the number of projects that need a restart.
The Road Department has the most trouble with these stalled projects. Out of about 300 struggling contracts, they have already cancelled 40 of them. Before canceling, the department asked the builders why the work had stopped. Some builders started working again after getting a warning. However, many others are still facing cancellation.
Shyam Bahadur Khadka from the Road Department said they are still processing more cancellations. Once a contract is officially over, the project office calculates the remaining costs. This information goes to the Ministry of Finance to get approval for new funding.
It isn’t just roads facing these issues. The Water Resources and Irrigation Department has cancelled 22 contracts. These projects saw no progress even after the government gave the builders extra time. One major project involved is the Sunkoshi-Marin Diversion, which is a very important national dam.
The original contract for this dam was worth over 14 billion rupees. The government ended the deal because the builders did not listen to repeated warnings. Now, the construction company has even gone to court to challenge the decision. Despite this, the department is moving forward to evaluate the work and find a new team.
The Ministry of Urban Development is also looking at its list. They have around 42 “sick” contracts but have only cancelled three so far. They plan to move money from other programs to pay for these new contracts.
The Ministry of Finance promised to manage the budget for these restarts. Spokesperson Tanka Prasad Pandey said they will follow the law to handle any extra costs. They want to make sure every new contract has a clear plan and enough money to finally get the work done.
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