Contractors worry about completing work on time

Thukten Zangpo

Although the Ministry of Finance gave notice to reschedule the completion of ongoing construction works, contractors said some procurement agencies were not complying with the notice.

According to the ministry’s notification on June 21 this year, the contracting agencies were asked to review all ongoing projects according to the current situation and determine whether the existing duration is sufficient or insufficient to complete the work.

Projects also include any work rescheduled earlier and projects that have entered the liquidation period.

Construction works were disrupted by the Covid-19 pandemic, and the import of construction materials and labor was a difficult task, which led to delays in the execution of projects.

The notification also stated that for projects that are unaffected or have an agreed duration sufficient to complete the project, the contract duration will be maintained in accordance with the existing signed contract.

However, the Ministry has requested the contracting agencies to postpone the expected completion date for the ongoing construction works and to issue a new single expected completion date for the construction work order for each project site for projects that are affected by the pandemic or agreed. over time under the existing contract is insufficient to complete the project.

A contractor said that although the Ministry of Finance had asked to reschedule the works, some dzongkhags and departmental procurement agencies did not accept it.

“Without this extension, we will have to abandon the works in progress and it would be a huge loss for the contractors as well as for the government,” he said.

One contractor said the availability of raw materials such as cement, sand and bricks was always difficult.

To import raw materials from India, entrepreneurs have to hire Indian drivers by paying them between Nu 1,000 and 1,500 for a bolero, he said.

He added that the government only allows 35 vehicles for transporting essential and other items per day, which is not enough for transporting raw materials.

Another contractor said there were no skilled workers in the country capable of repairing parts of heavy earthmoving equipment and they had to be sent to India. “Previously, it took three days to bring back repaired parts, but now it takes more than two weeks.”

A contractor also said that with the bank guarantees closed by the banks, the contractors are unable to proceed with the work as their property is mortgaged to the banks.

The executive director of the Bhutan Construction Association, Tshering Younten, said the association had asked the Royal Insurance Corporation of Bhutan and Bhutan

Development Bank Limited for a bank guarantee.

He added that the association has also asked financial institutions to accept third-party guarantee of real estate provided there is a legally binding document.

However, Tshering Younten said the government had reduced the performance bond from 10% to 5% of the quoted price.

In accordance with existing practice, performance security may be submitted in the form of a bank guarantee, cash order, demand draft or online submission through any bank prior to formal signing of the contract. contractual agreement.

The contractors also asked the government to consider paying an additional 20% for the increased cost of construction work and scrapping liquidated damages.

A contractor said that although Covid-19 has eased and become normal, the situation in the construction sector has not improved.

“Rising fuel prices have cost us dearly, Nu 500,000 has to be spent on diesel now, compared to Nu 250,000 before. Material costs have almost tripled,” he said.

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