Big spike in bitumen prices likely to hit road works in Himachal
Shimla, April 5 -- Sharp spike in the rates of bitumen and light diesel oil (LDO) due to the ongoing West Asia war has put the road work contracters in a fix.The rise has made it inviable for them to continue the work.
Echoing the same concern, officials said that the rates of both bitumen and LDO have doubled. While bitumen is essential for road construction, LDO is used in machines for tarring and metalling work.
At the time of preparing the detailed project report, the price of bitumen was Rs.43 per kg, which has now increased to Rs.86.60. Similarly, the price of LDO has increased by more than 50%.
In India, Indian Oil Corporation, Bharat Petroleum, and Hindustan Petroleum produce bitumen, but a significant portion of the demand for road construction is still met through imports from countries, including Iraq, Iran, the United Arab Emirates, Saudi Arabia, Kuwait, and Singapore, with the largest share coming from Iraq. The rise in crude oil prices globally has caused a significant hike in bitumen and LDO rates.
The spike has affected road works like tarring and metalling under Phase-3 of the Pradhan Mantri Gram Sadak Yojana (PMGSY) as it has made it financially inviable for contractors to continue work. The contractors have raised the issue with the PWD department. They warned that until concrete steps are taken to compensate for the increased costs, it would become difficult for them to continue work. They further said that the impact will extend to PMGSY Phase-4 as well.
The association of government contractors has demanded that the government arrange compensation at the earliest by securing additional financial assistance from the Centre, so that projects can be completed on time.
Speaking on the issue, the public works department (PWD) minister Vikramaditya Singh said they have taken up the matter with the central government.
"There is no doubt that global inflation is affecting India as well. The rise in prices of LPG, petrol, diesel and other petrochemical products has directly impacted bitumen and, consequently, road construction costs. We are aware of the situation, and the state has approached the Centre for support under centrally sponsored schemes to manage the financial burden. The rise has increased the cost inputs. There is a difference of Rs.100 crore which will definitely delay the works underway."
Under the PMGSY and National Bank for Agriculture and Rural Development-funded projects, the cost for 3-metre-wide roads has risen from Rs.13.75 lakh to Rs.17.75 lakh per km. Similarly, for 6-metre-wide roads under PMGSY/NABARD, costs have jumped from Rs.27.50 lakh to Rs.35.50 lakh per km. In case of 10-metre-wide roads, the expenditure has surged from Rs.41.25 lakh to Rs.53.25 lakh per km.
The price of rural road constructions under the annual maintenance plan has also increased from Rs.11 lakh to Rs.14.15 lakh per km.
Vikramaditya said the situation could further impact infrastructure development in the state. "This is a national issue. We will urge them to compensate in centrally funded schemes. While on roads under state government the Himachal government will take call. We may delay some targets depending on the international situation, but we will ensure that quality standards are maintained," added the PWD minister.
The minister added that the issue would be discussed with the finance department and the chief minister Sukhvinder Singh Sukhu....
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