The contractors for four out of the six sections of the highway have fled. The first phase of the project, under which 600 km of roads would be constructed and upgraded, was supposed to be completed by the end of the last fiscal year.

However, performance has been slow. Only one contractor working on the Tikapur-Lumki section has achieved 45 percent progress. On other sections, progress ranges from 1 to 25 percent, said the Ministry of Physical Infrastructure and Transport.

Ministry Secretary Tulasi Sitaula said Nepal had requested India about one and a half months ago to consider allowing it to choose the contractor itself with India limiting its role to financing.

“India has agreed to our proposal verbally. We are waiting for the written approval of the Indian government,” he said. He added that after India gives its go-ahead in writing, the government would call for fresh tenders for the project.  

According to Sitaula, India has been delaying give its written consent as it has not received clearance from the Dispute Resolution Board of India regarding the case filed by fleeing contractor Viswa Construction who has demanded compensation.

Viswa Construction has asked for damages from Nepal accusing it of not providing land for the road project. The firm had won the contracts for three out of the six packages under the first phase of the project. Another contractor who had received the contract for the Nepalgunj area has also run away, said Sitaula.

The first phase of the project covers 19 postal roads in Jhapa, Morang, Saptari, Dhanusha, Mahottari, Sarlahi, Bara, Rupandehi, Banke, Bardia, Dang and Kailali districts. The longest stretch under this phase will be the 73-km Seti-Dhangadhi road in Kailali and the shortest will be the 14-km Janakpur-Jatahi road in Dhanusha

Since the first phase of the project has only been crawling ahead, India is positive about letting Nepal select the contractors for the second phase.  India has stated that it will consider Nepal’s request to be allowed to appoint the contractors for the project’s second phase, as per the joint communiqué issued after Indian Prime Minister Narendra Modi’s Nepal visit in August.

According to the joint communiqué, the Prime Ministers of the two countries have directed the authorities concerned to commence the second phase within a year.

Meanwhile, Nepal has also requested India to finance the construction of bridges along the postal road in Tarai in the second phase. The southern neighbour is only financing the construction of the highway in the ongoing first phase.

When the project is completed, Nepal will have 1,500 km of blacktopped roads running north-south and east-west. The project is expected to strengthen road connectivity between the district headquarters and the southern parts of the country.