KATHMANDU, JUN 15 The input price index (IPI) of the construction sector has grown double-digit over the third quarter of the current fiscal year. The price index of construction materials soared 13.01 percent during the period as per the data released by the Central Bureau of Statistics (CBS).
Among the major inputs, the price of bricks, which holds a weight of 11.30 percent in the IPI, went up by almost 32 percent during the first nine months of 2009/10, according to the CBS data.
The price of cement, the largest weight holder in the overall index, also went up by 3.36 percent. The increment during the corresponding period last year was 22.36 percent. Similarly, labour costs and timber also registered a double-digit growth of 29.12 percent and 48.95 percent respectively.
In the same period last year, labour costs had increased by 17 percent. This year the cost has increased significantly because of escalating workforce shortage and inflation. “A massive number of workers is leaving the country for work in the Gulf creating a workforce shortage in the country,” said Shyam Manandhar, a construction materials trader. “It is hard to find workers even if you pay double.”
The price of iron and billets and others, the second largest weight holder in the IPI, declined by 7.75 percent. Entrepreneurs said that the price of iron rods and billets had decreased following a gradual increment in domestic production.
They said that the reason behind the hike in the price of major construction materials such as bricks and timber was a shortage of products amid high demand fuelled by increased construction of housing and apartments.
“There is an acute shortage of timber due to which the price has increase by almost 200 percent compared to last year,” said Ramesh Sharma, vice president of the Construction Materials Dealers Association.