The rising cost of construction materials is taking a toll on the construction sector in the country. This has come when the sector is trying to recover from the impact of the COVID pandemic. The sector came to a standstill when the country imposed lockdowns to fight the spread of the pandemic in the last two years.
After two years of uncertainties, Kaka Tshering is finally seeing his building take shape. The 66-year-old started the construction of his five-storied building in 2020 at Samtenling in Thimphu. According to him, the cost of constructing a building has soared in the last few years.
“The cost which was Nu 20 M in the past has soared to Nu 30 M today. This is because of the rise in the cost of construction materials and labour,” he said.
Kaka is not alone in bearing the brunt of the soaring construction costs.
“It is difficult to get construction materials on time. Even when we get it, the cost has increased by two-fold or three-fold. This is followed by the transportation cost which tends to go up every time the fuel price is hiked. But it never comes down even when the fuel price drops. Moreover, the labour cost has increased compared to the past,” said Dema Dema, a landlord in Thimphu.
“In the past, the transportation cost from Phuentshogling to here was Nu 14,000. However, the cost has now reached about Nu 27,000 to Nu 30,000. And the cost of materials has also increased from the source,” added Jigme Ugyen, the Project Manager of a private construction project.
According to a cement agency in Thimphu, most of the construction materials have become costly from the source in India. The agency says the cost of materials like rods, bricks and CGI sheets has increased by almost two-fold compared to what it costs in 2020.
“In the past year, the cost of fuel has increased by about 80 to 90 per cent. That is the reason the cost of the construction materials has shot up,” said Karma Tenzin, the Proprietor of Lilly Cement Agency in Thimphu.
But the increase is not holding the prospective house owners back from constructing houses. According to records with the Thimphu Thromde, close to 500 construction plans have been approved this year alone.
Since the construction is not deterred by cost inflation, it will be safe to assume that the burden of the high cost will fall on the tenants who will live in these upcoming buildings very soon.
Edited by Sonam