The government has initiated a new procurement process for the terminated sick contracts. Preparations are underway to evaluate the terminated contracts, determine their cost and number, and enter into new contracts. For this, the Ministry of Finance has called officials from the relevant development ministries and initiated discussions.

The Road Department under the Ministry of Physical Infrastructure and Transport has broken the most contracts. About 300 contracts under the department are sick, of which the department had issued a notice asking, 'Why not break the contract?' Out of these, the department has already broken 40 contracts. Work has been done on some of the remaining contracts after the notice was issued and some are in the process of breaking, said Shyam Bahadur Khadka, Deputy Director General and Spokesperson of the Road Department. 

New contracts will be awarded to the terminated projects only after obtaining source consent from the Ministry of Finance, said Ramhari Pokharel, Spokesperson and Joint Secretary of the Ministry of Physical Infrastructure. 'It is also evaluated at the time of breaking the contract,' he said, 'The information about the termination of the contract from the relevant project office and the file with the cost will be sent to the Ministry of Finance after it reaches the Ministry via the Road Department.' 

The Ministry of Finance has initiated discussions with a team including the Secretary of the Ministry of Development, who broke the contract, on how to do a new contract. Secretary of the Ministry of Physical Infrastructure Keshav Kumar Sharma said that discussions were held regarding how to manage the terminated contracts.

‘There has been a discussion in the finance department about how many contracts have been broken and how much it will cost to make a new contract,’ he said. ‘The finance and road departments will decide after calculating the number of broken contracts and the cost of the new ones.’ He said that since some of the broken contracts need to be renewed quickly, it will not take much time to complete this process.

Similarly, 22 contracts have been broken under the Water Resources and Irrigation Department. The department’s Director General Mitra Baral said that the contract was broken by issuing a notice after there was no progress in the work despite repeated extensions. ‘The broken contract is being evaluated,’ he said. ‘We will complete the process soon and invite a new contract.’ 

The department has broken the contract for the construction of the Sunkoshi-Marin Diversion Multipurpose Project, the largest dam of national pride. The project has stated that the contract was broken after there was no progress despite repeated warnings to the construction entrepreneurs. The contract agreement was signed for Rs 14.759 billion. Dissatisfied with the contract being terminated, construction entrepreneurs have gone to the Supreme Court. The contract for this project was taken by Patel-Raman JV. 

Dilip Bhandari, Joint Secretary, Planning, Building and Housing Division, said that many contracts under the Ministry of Urban Development have not been terminated. ‘Many contracts like roads and irrigation have not been terminated under this ministry,’ he said. ‘After termination, a notification should be issued as per the rules. We will transfer the required amount from other programs and enter into new contracts.’ He said that projects that were blocked by mistake are being gradually released.

‘The budget of projects contracted before the decision was taken by the Council of Ministers on 6 Asoj has been released,’ he said. ‘However, none of the new programs put in place in the current fiscal year have been released, there are around 1,600 such programs.’ Out of 42 sick contracts under the Department of Urban Development and Building Construction, only 3 contracts have been terminated. 

Finance Ministry Spokesperson and Joint Secretary Tanka Prasad Pandey said that the Ministry of Finance will manage resources in accordance with the prevailing law regarding the liabilities created when new procurement is called for in broken contracts. “Wherever the sick contracts are broken, those bodies will proceed with the new procurement process and Finance will manage resources in accordance with the prevailing law regarding the liabilities created in doing so,” he said. “If additional liabilities are created while contracting, there will be discussions on that.”