Construction of Chinese-funded Ring Road Delayed, Work Halted Due to Incomplete Tax Exemption Process

Kathmandu – Construction work on a major section of the Ring Road project, being built with Chinese grant assistance, has been halted after the government failed to complete the tax exemption process. Sources report that Chinese contractors stopped work on the project after the necessary documentation and approvals for tax exemptions were not made available in a timely manner.

This project is considered a crucial initiative to strengthen road connectivity between Nepal and China. However, concerns have been raised that the halting of construction due to administrative delays and lack of coordination from the government side could also impact cooperation between the two countries.

Project sources stated that the Chinese side took this step after repeated attempts to remind the concerned authorities about obtaining the required tax exemption certificates and approvals failed to yield a positive response. According to them, as long as the tax exemption process remains problematic, the contractor is unable to invest its own capital into the project, which could potentially delay the entire program.

An immediate comment from the government side on this matter was not available. However, internal sources indicate that the government has taken this issue seriously and is preparing to call a coordination meeting to find a solution soon.

The Ring Road project is considered extremely important for Nepal’s accessibility and development. The halting of work in this manner raises concerns about adverse effects on the project’s timeline and potential delays in the country’s infrastructure development. It is expected that the government will hold discussions with the Chinese side and promptly remove this obstacle.