Construction Development Board

CI Information

Industry Issues and Needs

Recognising a problem is halfway to solving it. With this in mind, the CDB is continually identifying issues that affect Bhutan construction industry. The CDB feels that addressing these issues and needs will contribute significantly to the development and promotion of the industry. This web-page has been created to document these issues in the hopes of encouraging the Industrys participants and stakeholders to help in resolving them. The CDB welcomes everyone involved in the Industry to submit their ideas and recommendations to address these concerns. Through dialog and discussion, the CDB hopes to create an awareness and a resolution to each of these problems.

Construction Industry Manpower Development - The CDB has identified the need for a rapid and extensive change to Bhutans practice of using cheap, low-skilled labour from her neighboring countries. A national effort must be started to transform the construction industry from an importer of labourers to an attractive employment opportunity for a highly-skilled, national workforce. To encourage nationals to become trained construction workers, the CDB recommends changes to existing working conditions, worksite facilities, and technologies. The government needs to encourage reductions in manpower through improved mechanisation and prefabrication. A single, skilled Bhutanese bulldozer operator is more effective and productive than hundreds of unskilled labourers.

Mechanisation of Construction and the Creation of Private/Corporate Hiring Units - To encourage mechanisation of the construction industry, the CDB would like to promote the creation of private/corporate hiring units. At present, the capital requirements of mechanisation are a major impediment to its wide-spread use. Hiring units, in which contractors are encouraged to lease equipment as needed, will remove the capital burdens of using specialised equipments and facilitate their use. The use of power tools and heavy equipment will improve construction quality, and reduce the duration of works. Building and roads will be produced faster and better.

The CDB, however, realises that the management of a mechanization program is complex and requires a highly dedicated and fully committed team. As such, the CDB feels that private entrepreneurs and/or corporate bodies are better suited for such ventures. However, the government and the financial institutes need to work together to make these ventures economically viable.

Introduction of Prefabricated Quality Construction Components - The introduction of prefabricated construction components in the construction industry would offer a number of advantages such as: (i) adoption of appropriate technology, (ii) enhancement of quality and quality control, (iii) business opportunity to entrepreneurs, (iv) employment opportunity to nationals, (v) higher productivity and faster output of works etc. It also facilitates innovation and creativity in the industry. Therefore, the CDB would like to encourage and promote in-country manufacturers to produce prefabricated/precast, modular and standardized construction components. By increasing its quality standards, the government can promote the use of these components in civil works, thus making the ventures economically viable and attractive. As proven in other countries, the long-term cost of prefabricated materials will eventually become lower than their individually created equivalents. Thus the governments long-term construction costs will decrease, while the quality of its works will drastically increase.

Institutional Capacity/Capability Building of Domestic Contractors - In order to facilitate the institutional capacity of domestic contractors, opportunities for their joint venture collaborations with foreign contractor needs to be explored. Foreign contractors who are involved in high-value, complex and specialized projects, can help to transfer skills and technologies to their Bhutanese partners. A joint venture manual between domestic individual contractor and/or contractor consortium and foreign contractor needs to be developed to facilitate these ventures. This is especially important as we are availing external assistance for our mega power and other national infrastructure development projects and our donors/development partners are bound to insist for engagement of their or international contractors for their assisted projects in Bhutan.

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Industry Statistic

The Construction Development Board has identified a need for improved statistics about the construction industry. This information will assist the government and contractors to better assess the status of the industry and to identify which sectors require additional attention.

At present the CDB is focusing on three types of industry statistics:

Tendering, Bid and Award Data - This data will be collected from procurement agencies during the tendering process. The data will identify key information such as who are active contractors, what are the average bid/win ratios, average tender-to-award durations, as well as common evaluation problems. This information will assist contractors to determine their necessary levels of investment, and to identify those construction sectors with the least competition. The data will be collected through the use of bidding report forms that will be completed and submitted to the CDB by all tender evaluation committees. Click here to view the three bidding report forms: BID01 (for Direct Contracting), BID02 (for Limited Tendering), and BID03 (for Open Tendering).

Contract Performance Data - This data will help assess the performance of both contractors and procuring agencies in executing government projects. The information will help determine those areas of contract execution that require improvement. The data will identify the principal causes of delayed works, price escalations, poor performance and contractual disputes. Click here to view the two contract completion forms: CON01 (for reporting about prequalifications), and CON02 (for reporting about contract completion).

Economic Data - This data will help determine the economic factors of the construction industry. As a significant contributor to the nations GDP, the growth and impact of construction industry needs to be closely monitored. Inflationary demands on the industry need to be identified and assessed. This information will help both the government and contractors to forecast the growth of the industry.

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