With the launch of several major infrastructure projects in the past few years—particularly roads, airports, irrigation systems and hydropower plants—the country has become one of the key potential markets for heavy duty construction equipment.

Sales of heavy construction equipment in Nepal are expected to have totalled $1 billion in 2015, industry insiders said. Demand has been growing in leaps and bounds due to a perennial shortage of manpower, they added. 

According to the Department of Transport Management, registrations of heavy equipment jumped 96.60 percent in the last fiscal year. As per the statistics, 8,328 excavators, backhoe loaders, cranes and heavy trucks were registered in the last fiscal year against 4,236 units in 2014-15.

The government’s plans to construct roads, railways, airports, hydropower projectsand mines across the country is expected to spur market demand for construction equipmentfurther in the years to come.

Machinery sellers in Nepal are reaping the benefits from a boomin infrastructure programmes. Dealers of heavy duty equipment said that the ongoing and planned infrastructure projects in Nepal project a huge demand for construction equipment in the coming years.

According to the Federation of Contractors’ Associations of Nepal, the construction industry in Nepal accounts for around 10 percent ofthe GDP and consumesabout 35 percent of the government budget. It is estimated that the sector provides 1 million jobs.

“This is boom time. We have been flooded with contracts to supply equipment,” said Tanka Bhatta, general manager of Continental Trading Enterprises, the authorised distributor of Komatsu excavators in Nepal.

“As there are plenty of construction projects in the pipeline, we are hopeful that the market share of Komatsu excavators will increase substantially this year from the 38-40 percent recorded last year.”

Currently, the company imports heavy equipment from the Komatsuplant in Chennai, India. Earlier, it used to get them from Thailand. Bhatta said that road, hydropower and airport projects were the major drivers of demand for heavy equipment.

The country has been undertaking short- and medium-term projects with a completion deadline of 4-5 years. “The country is yet to see mega infrastructure projects, particularly in the hydropower sector, of tomorrow, which normally have a completion deadline of 15 to 20 years,” he said.

Although demand for construction equipment slowed in 2013-14 owing to low investor confidence resulting in delays in construction projects, it has started to pick up lately. 

“Political stability is the key for development activities. Given long-term stability and increased investment, Nepal’s construction market is expected to emerge in a big way in the coming years, necessarily giving a big boost to demand for construction equipment,” said Bhatta.

MAW Enterprises, the authorised distributor of JCB in Nepal, one of the key players in the heavy equipment business, recorded a 100 percent rise in sales last year. The company said that it sold 2,000 units last year and expected to sell 3,000 to 4,000 units this year.

“Last year’s demand was spurred by the reconstruction programme,” said Sanjeeb Deuja, marketing manager of MAW Enterprises.

This year too, the government’s budget is focused on infrastructure development, and a massive amount of money has been allocated for it. 

“There will be an unprecedented growth in heavy equipment sales in Nepal if the government starts all its planned projects.” He said that manpower shortageswere one of the major reasons why machines were being increasingly used in all construction activities nowadays.

The cost of using machines is much lower than using labourers. Besides, machines are more reliable.

“That’s why people are

avoiding manual workers and using machines for the construction of even houses, small roads and

other activities that traditionally used to be done manually,” he said. “Even farming activities are being conducted with heavy equipment these days.”

There are 10-15 dealersof heavy construction equipment in Nepal.