4.

0 Applicability of both FIDIC 1999 Formula and JCT FR 2011 formula to the Sri
Lankan Context
1999 g works. FIDIC is also appropriate to the Sri Lankan context. There are some Su4.1
Applicability of FIDIC 1999 Formula
FIDIC ed 13.8- Adjus1999 Red Book for const b Clauses which are adoptable in Sri Lankan construction
industry..
To evaluate the applicability Book ruction contracts which contains some globally accepted conditions
related to building and the SubR tments for Changes in Cost in FIDIC 1999 Red Book, it does not
indicate that FIDIC 1999 fund project be used in the foreign Clause of FIDIC 1999 price adjustment
formula, it will be compare with locally practicing ICTAD/SBD/02. The FIDIC 1999 formula and
ICTAD/SBD/02 price adjustment formula are as follows engineerin formula can be entirely used for the
Sri Lankan construction industry. But the formulas can Anyway in as mentioned previous sections.
The FIDIC 1999 price adjustment formula

ICTAD/SBD/02 price adjustment formula



The prices of materials are. ICTAD/SBD/02 price adjustment formula have the tax components but not in
FIDIC 1999. Following sho, labour and plants are price adjustment formula highly flexible in the current
Sri Lankan market conditions. Local funded affected by those fluctuations and those fluctuations are
given by the ICTAD/SBD/02construction projects ws how ICTAD/SBD/02 price adjustment formula has
included the tax component.
Value of work done = (V V
na
)
Cost of labour, machinery, material and fuel = [(V V
na
) / (1+ P/100)]

90% (0.9) of the cost significant items are taken.
Cost significant items = [(V V
na
) / (1+ P/100)] x [1/0.9]
0.966
100
P
x
(Ixc - I
xb)

I
xb

(V V
na)

F =
All
Inputs
The fluctuation index = P
X
[(I
xc
- I
xb
) / I
xb
] /100
Therefore the Contractors payment =

The contractor has to pay the Goods and Services Tax (G.S.T) on the above payment.
Therefore the amount has to be paid to the contractor shall be the net amount as follows.

When deriving this formula P has been taken as 35.3% and Goods and Services Tax to
15%. Therefore,

In addition Book the be stated in the table of adjustment data included in the Appendix to Tender. The
monthly publ the economic situation in the country.
Even though FIDIC ished cost indices are much accurate than adjustment data included in the Appendix
to Tender so the procedure stated ICTAD/SBDindices that are used in the FIDIC formula shall price
adjustment stated that the cost
1999 price adjustment formula can be applied to the Sri Lankan context it will be helpful to use in
foreign funds construction projects.
formula considered impact on sensitivity to/02 the input percentages which are published monthly by
ICTAD. In FIDIC 1999 Red in FIDIC 1999 Red Book has adverse Sub Clause 13.8 - Adjustments for
Changes in Cost