NE BUSINESS BUREAU
AHMEDABAD, MARCH 17
Over 5,000 government contractors in Gujarat, under the banner of the Gujarat Contractors’ Association (GCA), have announced that the state government has accepted their long-standing demand to increase the project costs up to a 5 percent ceiling to offset the spiralling increase in raw material costs, said GCA president Arvind Patel here on Wednesday.
The GCA had been making representations to the state government on December 7 last year and again in January this year seeking to pay adequate compensation to meet the cost of 30 percent to 40 percent escalation in input costs like construction materials – steel, cement, bitumen, gravel, sand, bricks – logistics and labour charges.
To pressurise the government to accept their genuine demands, the GCA members have stopped filing tenders for the last 70 days viz since January 8 this year. They also formed a five-member panel to vigorously pursue their grievances like price escalation issue with the Gujarat Government. Since the government has accepted their demands, the GCA members will start taking part in tendering process with effect from Monday, March 21, announced Arvind Patel.
“The GCA expresses its gratitude to Chief Minister Bhupendra Patel and Roads and Buildings Minister Purnesh Modi and the senior officials of concerned department for resolving this issue amicably in the larger interest of state’s infrastructure development. This pricing will be done as per the Reserve Bank of India guidelines. Further, with effect from April 1, 2022, the state government will follow the standard bidding document to safeguard th interest of all stakeholders,” added Arvind Patel.
To a query on poor quality of construction, Arvind Patel said that the GCA stands for quality, safety and speed in completion of works. If any member is found to be lacking in these parameters, the company will be debarred from the GCA, warned Patel.
Case study supports contractors
Incidentally the construction industry has a major role in the development of the Indian economy. This industry consumes 40 to 50% of the national five-year plan outlay and contributes 20% of gross domestic product. Medium to large construction projects take over a year for completion and the cost of materials and labour often increase, which leads to major problems in administration of the contract, says a study.
