KATHMANDU: The government has decided to introduce a special price adjustment mechanism to address unusual price increases in the construction sector.
The Ministry of Physical Infrastructure and Transport made the decision under Section 55(1A) of the Public Procurement Act, 2063.
Prices of petroleum products, bitumen, HDPE pipes, cement and steel rods have increased unusually due to international conflicts and disruptions in the supply chain. Accordingly, special price adjustments will be provided for public construction contracts that remained under execution beyond Chaitra 15, 2082 B.S., based on actual and verified consumption.
Criteria and safeguards against double benefits
Contracts without annual price adjustment provisions will also be covered under the new arrangement if they meet the specified criteria.
For contracts that already have a price adjustment mechanism, only the eligible amount remaining after deducting the amount payable under the existing provisions and contract terms will be provided as a special price adjustment, the ministry said.
The mechanism will address only price increases caused by extraordinary circumstances, rather than normal market fluctuations. The amount will be determined based on actual consumption, verified quantities and relevant prices to prevent double benefits or unnecessary payments.
The government said the measure aims to prevent construction work from being disrupted due to extraordinary international circumstances, ensure the timely continuation of ongoing development projects and fairly address the economic imbalance created in the construction sector.
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