Nepal’s Ministry of Law, Justice and Parliamentary Affairs has begun groundwork to assess the need for a dedicated “infrastructure court” aimed at fast-tracking disputes linked to development projects.

The move comes as prolonged litigation continues to delay project completion and disrupt public works. Law Minister Sobita Gautam on April 8 formed a task force to study whether such a court is necessary and how disputes could be resolved more quickly.

Projects frequently stall after contracts are terminated due to poor performance by contractors, only for those contractors to challenge the termination in court. Until cases are settled, authorities are unable to award new contracts, leaving projects idle for years.

“We are concerned about how to fast-track cases that are holding back development projects,” Minister Gautam said. “The study will determine whether Nepal needs an infrastructure court.”

The panel, led by ministry secretary Parashwor Dhungana and comprising officials from multiple agencies, has been given 15 days to submit its report.

Officials in development-related agencies have welcomed the proposal, saying legal disputes have become a major bottleneck.

Rabindra Bohara, director general at the Department of Urban Development and Building Construction, said contractors often fail to meet obligations despite repeated warnings, and later use court cases to delay fresh tenders.

“Projects remain stuck for years because of litigation,” he said. “If decisions come quickly, work can move forward regardless of which party prevails.”

Authorities also point to a pattern where contractors take advance payments but fail to deliver, then file cases after contracts are scrapped, further prolonging delays.

Some officials, however, argue that a separate court may not be necessary. Ramhari Pokharel, joint secretary and spokesperson at the Ministry of Physical Infrastructure and Transport, said a dedicated bench within existing courts could suffice.

“A separate bench to prioritise infrastructure-related cases would help expedite hearings,” he said, noting that most such cases are currently handled by the Patan High Court and the Supreme Court, where resolution can take years.

Under current practice, no new contract can be issued until a dispute is settled. Interim court orders often halt construction entirely.

Mitra Baral, director general at the Department of Water Resources and Irrigation, said faster rulings would significantly improve project delivery. He cited the Sunkoshi Marin project, where a Supreme Court decision took four months, delaying dam construction.

Disputes are initially taken to the Nepal Council of Arbitration (NEPCA) or reviewed by the Public Procurement Review Committee. However, cases are increasingly being escalated to higher courts, prolonging resolution.

Nicholas Pandey, president of the Federation of Contractors’ Associations of Nepal, said arbitration decisions should be respected before approaching courts. He supported the idea of a specialised court with judges familiar with procurement law and construction issues.

Former secretary Kishor Thapa said both government agencies and contractors are often at fault in contract disputes. While existing legal provisions allow arbitration, he said, faster adjudication is essential to prevent persistent delays.

The task force includes representatives from the Supreme Court, multiple ministries, the Office of the Attorney General, the Public Procurement Monitoring Office, and the Investment Board Nepal.