KATHMANDU: Nepali contractors are threatening to launch a large-scale protest if the government does not pay outstanding debts by the end of the current fiscal year, which comes to almost Rs 60 billion. The supply chain of the economy has been badly affected by delays in payment for development projects, according to the Federation of Contractors' Associations of Nepal (FCAN). Roshan Dahal, FCAN's general secretary, highlighted that payments have been pending for the past two years, despite recent partial disbursements from the government.
As the fiscal year draws to a close with only a week remaining, the government has frozen its accounts since Monday. Although ministries involved in infrastructure projects requested Rs 35 billion from the Ministry of Finance, only Rs 15 billion has been released through budget transfers. The delay in full payments is attributed to technical issues, according to contractors, who await the remaining Rs 20 billion.
FCAN specified that under the 13th amendment to Public Procurement Regulations, the government owes Rs 40 billion to contractors. Additionally, there is an outstanding Rs 20 billion earmarked for ongoing construction projects. The Ministry of Finance cited constraints in releasing funds, particularly for projects without secured financial sources, noting that further disbursements might not occur until mid-October of the upcoming fiscal year due to regulatory provisions.