Government Bans Bitumen and Asphalt Road Construction, Mandates Domestic Products

Kathmandu. The Cabinet meeting has approved the Directive on Promotion and Use of Domestic Products in Public Procurement, 2083. With this decision, a policy arrangement has been made to reduce dependence on imported materials in government procurement and infrastructure construction, prioritizing the use of domestic products, local resources, and domestic technology.

The 11 major policy changes under this decision are as follows:

• Mandatory use of domestic products in government procurement: Government agencies must use domestic goods and local materials that meet prescribed quality and technical standards, as long as they are available.
• End of import-oriented design: While designing infrastructure such as roads, bridges, and buildings, designs cannot be made in a way that necessitates the use of foreign materials when suitable domestic alternatives exist.
• Priority to domestic alternatives for blacktopped roads: Instead of imported bitumen-based blacktopping, if technically suitable, concrete roads made from domestic cement, local stone, and other domestic construction technologies must be adopted.
• Domestic construction and finishing materials in government buildings: Priority to suitable domestic marble, stone, slate, and tiles instead of imported granite, tiles, etc. Domestic alternatives must also be adopted in building decoration, electrical fittings, furniture, and sanitary works.
• Promotion of domestic industry without compromising quality: While using domestic products, quality, safety, durability, and technical standards must be mandatorily complied with. Promote market expansion of quality domestic products, increase industrial production, create employment, and encourage import substitution.
• Ban on government procurement targeting foreign brands: When suitable domestic alternatives are available, technical specifications cannot be prepared targeting only a foreign brand, production site, or country of origin.
• Ensuring domestic materials from planning and DPR stage: Maximum use of domestic products and technology from the stage of feasibility study, design, detailed project report (DPR), cost estimate, and bid preparation.
• Binding condition in construction contracts to use domestic materials: Provisions to use domestic materials must be included in bids, technical specifications, bills of quantities, and procurement contracts. Once domestic materials are specified in the contract, foreign materials cannot be used without approval.
• National market for local resources and products across Nepal: Policy arrangement to allow construction materials produced or processed from natural resources and raw materials available within Nepal to be used in public projects and government procurement across the country.
• Determination of responsibilities of government officials and consultants: The responsibility to ensure the use of domestic materials has been assigned to the heads of concerned public agencies, technical personnel and consultants preparing studies and designs, and officials granting approval.
• Strict action against fraud in the name of domestic products: Construction entrepreneurs or suppliers who supply foreign materials claiming to be domestic, use fake brands or labels, or provide false details of production site will have their materials rejected, payments may be stopped, and the process of blacklisting and legal action will be initiated.

The directive amendment has created a new basis for increasing the use of domestic materials in construction and procurement through the government budget, expanding production, employment, and economic activities within the country.