Costlier bitumen: After MCD, PWD may revise rates of construction materials to cover price escalation of road projects
Various projects have been stalled over the past two months, officials said, also mentioning that for projects which were expected to complete by March 31, the deadline has now been extended to July 31.
“Bitumen prices have increased sharply, due to which road projects are affected. The prices are so high that it cannot be managed. So the MCD has revised its prices… We (PWD) are also planning to revise the rates, so that the work is completed before monsoon and the people do not face problems,” said Singh.
PWD Minister Parvesh Sahib Singh on Thursday said that in line with the Municipal Corporation of Delhi (MCD), which has recently issued a notification revising the rates of construction materials to adjust the cost escalation for its road projects halted due to bitumen crisis amid the West Asia conflict, the PWD is planning to issue a similar order for its ongoing projects.
According to officials, there has been around 30% escalation in cost of projects due to rise in prices of raw materials — mainly bitumen — and this has to be adjusted. Earlier, one metric tonne of bitumen cost between Rs 40,000 and Rs 50,000, but prices have now risen to Rs 70,000-Rs 80,000 per tonne.
“Bitumen prices have increased sharply, due to which road projects are affected. The prices are so high that it cannot be managed. So the MCD has revised its prices… We (PWD) are also planning to revise the rates, so that the work is completed before monsoon and the people do not face problems,” said Singh.
Various projects have been stalled over the past two months, officials said, also mentioning that for projects which were expected to complete by March 31, the deadline has now been extended to July 31.
The rise in bitumen prices has had an impact on road repair and strengthening projects across nearly 200-250 km of roads in Delhi. While work on another 200-250 km of roads have been completed, tenders are live for projects on 600 km of roads.
Contractors are now asking us to close the tenders because while they can bear a cost escalation of Rs 20-30 lakh, none will bear losses worth crores…This is impacting projects and eventually, the public will face problems…,” said a senior government official.
Officials also said that the PWD is likely to “move a proposal before the Expenditure Finance Committee (EFC) for approval…There is a cost escalation of around 30%…the additional burden may go up to around Rs 100 crore.”
“We carried out repair work using whatever stock was left, but prices have risen sharply and are now far above the rates at which tenders were awarded. Work has, therefore, stopped,” said a contractor associated with the projects.
Bitumen, derived from crude oil, is mainly used as a binder in road construction where it holds together materials like sand, gravel, and crushed stone, to form asphalt. Waterproof, adhesive, and flexible, it helps roads withstand traffic load and various weather conditions.
Other key PWD projects that have been impacted due to rise in bitumen prices include strengthening of 153 stretches spread across 400 km of roads and repair of 128 stretches. Some of the stretches are Bipin Chadrapal Marg to CR Park police station, Outer Ring Road, Inner Ring Road, Africa Avenue Marg, Mathura Road, Ashram and the area near ISBT Kashmere Gate.
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