Govt unlikely to clear higher bitumen payments sought by contractors

Ranchi: The state government has raised objections to contractors’ demand for compensation over the sharp rise in bitumen prices used in road construction, significantly reducing the chances of any additional payment being approved.

According to sources, a committee had examined the contractors’ demand regarding the increase in bitumen prices and forwarded the proposal to the government for consideration. However, the government has reportedly objected to the proposal, citing the terms and conditions of the original tenders.

Officials have questioned whether tender agreements contain any provision requiring contractors to refund money to the government if the price of construction materials falls during the execution of a project. The government has argued that if such a clause does not exist, there is also no clear basis for granting extra payments when material costs rise.

The objection has cast serious doubt on the contractors’ demand for reimbursement based on the increased cost of bitumen.

Bitumen prices have surged sharply in recent months following geopolitical tensions involving Iran and the United States. The cost of a drum of bitumen has reportedly increased from around ₹7,500 to nearly ₹17,000, while the government-approved rate for project calculations remains fixed at ₹7,500 per drum.

Contractors had urged the government to revise payments in line with the increased costs, warning that road construction projects could be affected if the issue remained unresolved. With the government’s latest stand, however, a favourable decision on the demand now appears unlikely.