Road construction and maintenance projects across Punjab are facing delays and financial pressure as a shortage of bitumen and a sharp increase in its prices disrupt work ahead of the 2027 Assembly elections. With the polls approaching, the Aam Aadmi Party (AAP)-led state government is seeking to highlight improvements in road infrastructure, but rising material costs are creating challenges for contractors executing projects across the state.

Bitumen, a petroleum-based material widely used in road surfacing, has become significantly more expensive in recent months. According to sources, its price has risen from around Rs 4,000–4,500 per quintal before the US-Iran conflict to approximately Rs 9,000 per quintal now. The increase has added to the cost of road construction and maintenance, forcing contractors to reassess project expenses and raising concerns about the pace of execution.

The shortage has compounded the problem, with domestic production failing to keep pace with demand. India’s bitumen production has remained broadly stagnant at around five million tonnes, while consumption has increased to 8.74 million tonnes. The resulting gap has contributed to supply constraints, leaving contractors struggling to secure sufficient quantities of the material. Road maintenance contracts are reportedly among the worst affected, as the work depends heavily on bitumen for resurfacing and repairs.

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The price escalation is also putting pressure on project budgets. Contractors working on government projects must account for higher input costs, even when agreements were drawn up at lower prices. Some contracts include a provision stating that variations in bitumen prices will be considered during the execution period. While such clauses can provide a mechanism for adjusting costs, they may also increase the financial burden on the government when material prices rise sharply.

Imported bitumen is adding another layer of expense. Sources said imported supplies are around Rs 3,000 per quintal more expensive than domestic bitumen, making them a costlier alternative for contractors attempting to bridge the supply gap. Prices are also expected to rise further, according to the sources, creating uncertainty over the final cost of ongoing projects. The extent to which contractors can absorb these increases, or seek adjustments under their contracts, could influence project timelines and expenditure.

The difficulties come as the Punjab government prepares to make infrastructure development a part of its record ahead of the 2027 Assembly elections. Road upgrades and maintenance are visible public works that can be highlighted during a campaign, but delays or reduced activity could complicate that effort. The combination of constrained availability, higher prices and possible additional payments under contract provisions has left road projects facing both logistical and financial challenges. The impact on individual project schedules and the state’s overall expenditure will depend on how supplies and costs evolve in the coming months.

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