KATHMANDU: As the fiscal year 2023/24 comes to an end, contractors have started halting their work due to unpaid bills. Ramesh Sharma, chairman of Sharma & Company, reported stopping several projects, including the Nepalganj-Gulariya road section under the Postal Highway, and withdrawing the equipment used on site.

The government had promised to make payments by the end of the current fiscal year after which Sharma's company continued working. However, the lack of payment forced them to cease operations.

According to the contractors, the government owes approximately Rs 60 billion. The Department of Roads and other offices have acknowledged their inability to pay the contractors, citing the Ministry of Finance's failure to approve the necessary funds.

The contractors, having not received their payments by the end of the fiscal year, have initiated protests. Some have been compelled to halt ongoing projects.

The Department of Roads’ inability to secure the requested amount from the Ministry of Finance has led to partial payments. The department had requested a transfer of Rs 12.5 billion, but the ministry approved only Rs 6 billion on July 9.

Amit Kumar Sharma, Deputy Spokesperson for the Department, stated that the funds received were allocated for the improvement of Mid-Hill Highway, Postal Highway, North-South Corridor, and constituency roads. As we received less than the requested amount, we could not pay all the bills.

Projects under the Department of Roads, including those related to water supply, irrigation, urban development, and local roads with bridges, have also faced payment issues.

Contractors have threatened to lock offices to secure their payments. Despite positive assurances from the Prime Minister and Minister of Finance, the Federation of Contractors Association of Nepal has announced protests, blaming the delays on part of the employees of the Ministry of Finance.

At a press conference in Kathmandu on Thursday, Ravi Singh, President of the Federation, stated that thousands of contractors are facing bankruptcy due to the delay in payments. He mentioned that district offices responsible for payments have been locked.

Singh clarified that the Federation did not obstruct the Federal Finance and Physical Infrastructure Ministry. "We have implemented a policy to prevent non-paying offices from proceeding with their work," Singh said. "With a new government being formed, we are holding further discussions on our next strategy."