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The ongoing conflict between Iran, Israel, and the United States in the Middle East has directly affected Nepal’s infrastructure and road construction sectors.

The sharp rise in the prices of fuel, bitumen, and construction materials has had a direct impact on large-, medium-, and small-scale infrastructure and road construction projects contracted by the federal, provincial, and local governments.

Due to the shortage of bitumen, blacktopping work on a seven-kilometre stretch of the East-West Highway in the western section has been halted.

The construction company is preparing to bring an additional eight kilometres of road to the blacktopping stage by mid-July 2026. In the eastern section, more road stretches are being prepared with base layers for blacktopping.

On one hand, unseasonal monsoon rains have damaged roads that were ready for blacktopping, while on the other hand, the shortage of bitumen has created difficulties in carrying out blacktopping work.

According to Dormani Paudel, Project Manager of CRFG-Tundi JV, which is carrying out the expansion work of the East-West Highway from Sitapuri in Jhapa to Lobipur in Sunsari with the support of the Asian Development Bank, the project currently requires 12,000 litres of diesel daily.

However, Nepal Oil Corporation (NOC) has been supplying only 4,000 litres. As a result, many equipment have remained idle.

Similarly, in the western section, around 5,000 tonnes of bitumen is required for 15 kilometres of road that are expected to be ready for blacktopping before mid-July, 2026.

The construction company has already opened a Letter of Credit (LC), but the required quantity of materials has not yet arrived.

Moreover, construction entrepreneurs are worried about how to complete the projects as prices have doubled compared to previous years.

Small-scale contractors are facing even greater difficulties than large and multi-year projects.

The multi-year projects may wait in the hope that prices will decrease next year, but those who must complete work and receive payment before the end of current fiscal year are in a difficult situation.

Bhoj Kumar Shrestha, proprietor of Abbas Construction, Kanepokhari-5, Morang, said, “When we took the road contract, the price of bitumen was Rs. 96 per kilogram including VAT. Now it has reached Rs. 165. Likewise, diesel price has risen to Rs. 222 per litre, whereas it was Rs. 137 when the contract was approved.”

Shrestha said that bitumen price has increased by 71 per cent and diesel price by 62 per cent.

He said that small projects do not have alternative options. Roads where base layers were laid 15 days ago have already deteriorated to the point that blacktopping is no longer possible.

Unseasonal monsoon rains have further worsened the condition of road improvement projects, he said.

According to Bimal Kumar Sah, Information Officer at the Biratnagar Customs Office, about 183,166 tonnes of bitumen had been imported through the Biratnagar customs point by May 9, 2026.

During the same period in the previous fiscal year, about 287,505 tonnes of bitumen had been imported.

At a time when bitumen imports are usually at their peak, imports have decreased by 104,388 tonnes during the review period as compared to corresponding period in the previous year.

Chief Customs Officer Umesh Shrestha said that the decline in imports has affected not only revenue collection but also overall development activities.

By Hari Prasad Koirala