KATHMANDU, Oct 17: The government has introduced a policy to prioritize domestically produced materials and technologies in public procurement and infrastructure development, aiming to reduce dependence on imports, boost local industries and create jobs.
The Cabinet has approved the Directive on the Promotion and Use of Domestic Products in Public Procurement, 2083, which requires government agencies to prioritize domestic goods and locally available construction materials that meet prescribed quality and technical standards.
According to the Ministry of Infrastructure Development, the directive introduces 11 major policy changes, including provisions to promote domestic alternatives in road construction, government buildings and other public infrastructure projects.
Under the new provisions, infrastructure projects such as roads, bridges and buildings cannot be designed to require imported materials when suitable domestic alternatives are available.
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In road construction, concrete made with domestically produced cement, locally sourced stones and other indigenous construction technologies must be considered as alternatives to bitumen-based roads where technically suitable. The provision seeks to reduce reliance on imported bitumen but does not explicitly prohibit the construction of asphalt roads altogether.
The directive also prioritizes domestic marble, stone, slate and tiles over imported granite and other finishing materials in government buildings. Domestic alternatives must also be considered for electrical installations, furniture, sanitary fittings and decorative works.
To promote local industries without compromising quality, domestic products must meet prescribed standards for quality, safety, durability and technical performance. The government aims to expand markets for domestic products, increase industrial output, generate employment and promote import substitution.
The directive prohibits public agencies from preparing technical specifications that favour a particular foreign brand, manufacturing location or country of origin when suitable domestic alternatives are available.
It also requires the use of domestic products and technologies to be incorporated from the initial stages of project planning, including feasibility studies, designs, detailed project reports (DPRs), cost estimates and tender preparation.
Tender documents, technical specifications, bills of quantities and procurement contracts must include provisions requiring the use of domestic materials. Once domestic materials are specified in a contract, contractors cannot substitute them with imported materials without approval.
Construction materials produced or processed using natural resources and raw materials available in Nepal will also be eligible for use in public projects and government procurement across the country, potentially expanding market access for local producers.
The directive assigns responsibility for ensuring the use of domestic materials to the heads of concerned public agencies, technical personnel and consultants involved in project studies and design, as well as officials responsible for approving projects.
It also introduces penalties for contractors and suppliers who misrepresent imported materials as domestic products, use counterfeit brands or labels, or provide false information about manufacturing locations. Such materials may be rejected, payments withheld, and blacklisting or legal proceedings initiated against those involved.
The government expects the revised directive to increase the use of domestic materials in publicly funded projects and expand production, employment and economic activity within the country.