According to the Investment Nepal Board (IBN), the government has given priority to the ‘energy’ sector in terms of Foreign Direct Investment (FDI).

Following next in line is ‘transport’ and ‘aviation’ sectors at second and third positions as per the list and costs shared by the investment summit board.

Sources say that energy is being given top preference to avoid an energy crisis in future, like the decade-long crisis until 2016.

The government has also come up with a policy of building 15,000 MW of electricity in the next ten years to ensure energy security.

Energy, Transport and Aviation Projects

The opening of Indian market for Nepal’s energy sector through recent policy guidelines by the Government of India has also given hopes for hydropower.

Nepal Energy Minister Barshaman Pun also encouraged independent power producers to build power plants, assuring them of market guarantee. The private sector aims to bring an FDI for 11 projects.

Similarly, a total of six transport projects including Kathmandu Ring Road of Bus Rapid Transit worth USD 9.7 billion will also be presented at the two-day event.

The Nepal aviation sector, the third priority of the summit, aims to draw USD 3.25 million or 12.3 percent of FDI for 63 projects worth USD 26.38 billion.

Other projects

The other projects in the government list include:

• Tourism: Cable car, hospital tourism products and hotels at the provincial level
• Industrial Infrastructure: Currently, bills related to project development in PPP model as well as FDI and technology transfer are being prepared in the parliament.

 IBN CEO Maha Prasad Adhikari said that the government was working on getting those bills endorsed before the investment summit.

Nepal FDI History

As per NRB statistics, FDI in Nepal reached an average of about USD 33.74 million between 2001 and 2017. The country received an all-time high FDI of USD 13.50 million in 2017.

Further, an NRB study also revealed that Nepal received 0.01 percent of the total FDI in the world, while South Asia received 3.1 percent of the global FDI in 2016.

Live Updates:

• Nepal Investment Summit 2019: Nepal as Favorable Investment Destination

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Nepal’s new agreements in March 2019 began with a defense deal on March 01, 2019 involving US and Poland, and then followed two MoUs on satellite project and security printing system with France.

As part of the defense deal, the US Government contracted with a renowned Polish aircraft manufacturer Polskie Zaklady Lotnicze for the supply of two new M28 Skytruck aircraft to Nepal.

The USD 18.9 million defense deal is termed as ‘Foreign Military Sales (FMS) contract.

Polskie Zaklady Lotnicze (PZL) M28 Aircraft

 “This contract involves foreign military financing to Nepal. This award is the result of a country-directed sole-source acquisition. Foreign military financing funds in the full amount are being obligated at the time of award,” the US Defense Department said in a statement.

The deal package involves a ferry flight to Kathmandu along with training & technical publications.

Under the agreement, the US Government has come forward with a financial backing of USD 19 million for a pair of Mielec M28 Block 50 utility transports to be delivered to Nepal.

As per the contract, the project at Mielec will be completed by December 2019.

Nepal, Third M28 Operator in Asia-Pacific

As per the records, Nepal has one M28 aircraft currently that is of 16 years old. Besides, the country had also operated two such models in the past, one of which crashed on May 30, 2017.

There are 76 M28s in service with 16 operators, globally, and Nepal stands among the three Asia-Pacific operators including Vietnamese Air Force and the Indonesian Police, which are currently using one each.

Stay tuned for more such interesting Nepal’s World News Headlines!

The post US Contracts Military Aircraft Deal for Nepal, Extends $19 Mn Finance! appeared first on Nepali Sansar.

Following the chopper crash that killed seven officials including Tourism Minister Rabindra Adhikari, the Civil Aviation Authority of Nepal (CAAN) has announced measures for operational safety of helicopters flying the region.

In this regard, the country’s aviation experts are currently preparing VIP flight guidelines for choppers while also welcoming foreign experts to conduct operational safety assessments.

“We have given the helicopter safety team two weeks to prepare the VIP flight guideline. The guideline will basically incorporate flight planning, pilot experience to handle VIP flight movement and other required procedures related to weather and terrain,” CAAN Deputy DG Rajan Pokhrel said in a statement.

Pokharel further informed that the new measures are part of the International Civil Aviation Organization Annex 19 mandates for implementing safety management system.

According to officials, the new rule also enforces strict following of instructions even in case of emergencies that demand change in pilot’s decision.

It is noteworthy here that the recent crash of Air Dynasty chopper happened after the Captain Prabhakar KC reported “heavy snowfall and not able to airborne”.

However, KC proceeded further and had hit a mountain cliff. What forced the captain to proceed is the matter under probe!

“The new guideline will strictly enforce this rule and hopefully develop a culture to refuse to fly when the situation is not favorable,” adds Pokharel.

Load factor is another key aspect that the experts laid emphasis on! Towards this end, the regulator urged the operators of AS350 B3e helicopter to temporarily bring down the bench seat to the level of pilot’s seat in high-altitude conditions.

“Based on the experts’ advice that reducing load can increase choppers flying performance, we decided to reduce one seat from the AS350 B3e helicopters while flying in high-altitude areas,” said Pokhrel.

It is noteworthy that adverse climatic conditions is among the top reasons for flight crashes in Nepali air space!

The regulator also announced to stop flying choppers at a helipad in Gorak Shep, located at 5,164 metres elevation near Everest Base Camp, owing to the region’s fast-changing weather conditions.

“We have asked the operators to find an alternative to Gorak Shep. We will assess the new area before allowing helicopters to perform their operation from the new base,” Pokharel informed.

The latest decision is coming in the light of debate over growing number of chopper crashes in Nepali airspace.

Hope the new regulations would come as savior in controlling the unexpected air accidents.

The post Nepal Air Crashes: CAAN Enforces Strict Air Safety Guidelines appeared first on Nepali Sansar.

The national flag carrier informed this in a recent update, where it said that it’s currently running out of cash and is on the verge of bankruptcy.

Nepal Airlines’ official report released on November 15, 2018 has shown that the carrier’s monthly cash deficit has reached NPR 317.79 million.

The airlines’ deficit has reached this level since addition of two long-range Airbus A330s to its fleet months back, termed as the largest-ever purchase in the history of Nepali aviation.

“We are facing severe financial stress and have requested the government to bail us out. The reason we have been dragged into financial stress is that we have not been able to operate the newly-acquired A330s to their full capacity,” says Madan Kharel, Executive Chairman, Nepal Airlines Corporation (NAC).

Although the situation is expected to recover after the fleet operation begins, the Corporation requests the government for an immediate ‘bail-out’ for now!

Fast-depleting cash flows is another major problem that the airlines is suffering from, say the officials.

The airlines’ debt-to-equity ratio has reportedly grown three-fold since the last summer, from 14.40 percent to 39.82 percent, which means the company is receiving most of its budget as a borrowing and continuing the same leads to business decline to the level of bankruptcy.

What’s Leading to Bankruptcy?
The national flag carrier was enjoying a monthly revenue surplus of NPR 12.54 million prior to the Airbus jets’ deal.

According to the official data, the maintenance of these two jets for a month period (August 1-September 15, 2018) tripled airlines’ expenses to nearly Rs 756.6 million, adding to its deficit of NPR 491.8 million and giving it a mere NPR 264.8 million in earnings.

The two A330 jets are currently being used for less than seven hours in a day and less than 50 percent of the required flight time usually required to generate a decent profit.

The deal added to the dire state of Nepal Airlines’ finances, which was already facing the intensity of offering massive loans to various institutions, both long and short-term loans, which stand at NPR 41.73 billion and owes more than NPR 3.66 billion in interest annually.

“The corporation’s financial health is really bad. If things continue the way they are, the airlines will begin defaulting on payments and staff salaries,” says an official associated with NAC’s operations.

‘Yet to Utilize Due Potential’
The official continues to say that Nepal Airlines’ case is different from similar ones in other nations like India as “the new planes have not been utilized prudently and commercially”.

NAC has reportedly failed to scope pilots in advance for the new aircraft following the traditional practice of getting planes first and then pilots.

Besides, the Corporation still has nearly three planes waiting at the Tribhuvan International Airport for pilots.

Above all, officials feel that was not appropriate to equip the airlines with the country’s youngest fleet, inducting two Airbus A320 aircraft in 2015 and two additional wide-body A330 in 2018.

“Despite the pilot shortage, the corporation again started homework to procure two more A320neo jets for international route and six Viking Twin Otters for domestic operation,” says a senior captain at the corporation.

According to Kharel, shortage of flight crew is stopping new planes from exhibiting their optimum potential.

“We were also not able to expand our routes to Japan, South Korea and some European countries from where we would have generated good income,” he adds.

The post Nepal Airlines Stuck in Financial Stress, Requests Bail Out! appeared first on Nepali Sansar.

The Ethiopian Ambassador to Nepal Asfaw Dingamo Kame has reportedly proposed a deal with Nepal Tourism Minister Rabindra Adhikari to sign a strategic alliance with NAC, in a meeting in Kathmandu last week.

This deal with NAC comes as part of the African airlines’ strategy to set up multiple hubs beyond its region. As an owner of a fleet that accommodates 108 aircraft, Ethiopian Airlines is currently serving 125 international and domestic destinations.

The latest news also gains significance in view of Adhikari’s recent update to Nepal Parliament about government’s plans for a strategic alliance with a foreign aviation partner.

However, details about the deal are yet to be officially announced.

“We need to sign an air service agreement first to form a partnership to invest in Nepal Airlines. We can also start with a code share agreement,” Ambassador Kame said in a statement.

A Strategic Move
The latest proposal is Nepal Government decade-long wish to bring in a foreign aviation partner for NAC and is coming at a time when the Nepal Government is also planning to revamp NAC into a company before signing a deal with foreign partner.

On the other hand, the Finance Ministry has already recommended induction of the foreign strategic partner with maximum benefits to NAC under the partnership.

Tourism entrepreneur and a former member of NAC Ashok Pokhrel feels that the foreign alliance will add to the brand value of NAC and also supports it financially.

“We have been hearing for a long time that the government is inducting a foreign strategic partner at NAC. The plan, however, has remained on paper only. But it’s not too late. The government should act promptly before the airline is put into financial stress,” Ashok Pokhrel said in a statement.

“At a time when NAC has been facing criticism for its failure to assure quality and efficiency, a strategic partner, if it is a globally reputed company, can help the carrier to win business globally,” he adds.

Nepal-Ethiopia Ties Growing!
Kame also held discussions with Foreign Minister Pradeep Gyawali regarding Nepal-Ethiopia partnership in forming a bilateral consultative mechanism and carrying out a parliamentary exchange program, among other areas.

Speaking to local media, the Ethiopian official explained that the two countries haven’t exchanged much in partnership since they established diplomatic ties in 1964.

However, the bilateral partnership gained momentum with the establishment of Ethiopia’s honorary consul in Nepal in 2015.

Ethiopia has also urged Nepal to establish its residential mission in the capital Addis Ababa, the area that also hosts the Secretariat of the African Union.

The Background
Nepal Government initiated this plan to bring in a foreign partner in 2007 with an aim to handover NAC’s management to that strategic partner.

Prior to that, the then Royal Nepal Airlines Corporation (RNAC) had invited experts from Air France in 1970 as part of a program to improve NAC management. And, the partnership gave RNAC its first jet, Boeing 727.

Later in 2015, nearly 21 foreign firms applied Letter of Intents (LoIs) to offer world-class management consultancy services to NAC, but the plan didn’t work out.

Later in 2016, the government invited request for proposals from renowned carriers from US, UK, France, Germany and Australia, and only one carrier turned out with Rs688.67 million worth proposal.

Then the Finance Ministry turned it down and then decided to a set up a fresh committee, which again failed with the government pitching for ‘multiple modality options’ before sealing the deal.

While officials are of the view that the deal should be held on a global competition, Ethiopia proposed it under government-to-government procedure.

Now, its government’s turn to react in an appropriate way!

The post Africa’s Largest Air Carrier Proposes Deal with Nepal Airlines appeared first on Nepali Sansar.

In line with the Nepal Air Corporation’s (NAC) plans, the new decision envisages signing of new agreement with Australia and revising of the existing aviation agreements with UAE and Thailand. 

According to Pramod Nepal, Undersecretary at the Nepal Ministry of Culture, Tourism and Civil Aviation (MoCTCA),  Nepal and Australia have already signed deals to operate seven weekly flights. 

“We have been holding talks with Australia to sign our first MoU regarding ASA. We have received positive response from the Australian Government on the draft MoU. We are in the process of preparing a final MoU based on the feedback and hope to sign the ASA very soon,” says Pramod. 

Under the deal, Nepali airlines has been allowed to fly its planes across Australian cities such as Brisbane, Perth, Sydney and Melbourne. 

Flights to Australia have become more viable in recent years as the number of Nepali students pursuing their academics in Australia and the number of Australian tourists visiting Nepal have both gone up, adds Pramod.

Revisiting the Existing
In another update, Nepal is also gearing up to sign a revised MoU with UAE to boost the air traffic between the two countries, which is currently at 28 flights per week. 

Signed for the first time in 1999, Nepal and UAE revisited the agreements and signed the revised MoUs in 2013 and 2015. 

Meanwhile, the government is under plans to discuss with Thailand about the revision of the existing ASA between the two countries.  

The Nepal-Thai air deal was first signed in 1971 to allow Nepali flights fly to Thailand and was again revisited in 2004 increasing the number of Nepali flights to Thailand to 10 in number. 

“We expect the revised agreement to be ready in the near future,” says Pramod. 

Riding High on Air Agreements
The latest updates are coming as a development after NAC received its first-ever 274-seater Airbus A330-200 series wide-body aircraft from AAR Corporation, very recently. 

The Corporation is also set to receive it’s another such aircraft later in July 2018 and plans to have two narrow-body aircraft by 2019 adding to its international fleet. 

So far, Nepal has signed bilateral ASAs with 38 countries, which facilitates ways for Nepali airlines to operate 214 flights per day to and from various destinations. As government officials say, Nepal has been able to operate only 40 percent of these flights due to less number of carriers. 

The post Nepal Aviation Update: Three New Pacts Under Expansion Plans appeared first on Nepali Sansar.

With ASA in place, Nepal carriers will now be able to operate flights in all airports across Japan except Haneda international airport in Tokyo. Now, the number of Nepali flights flying to Japan will grow seven-fold i.e. about 14 flights per week in comparison with 2 flights per week in the past.

“Our 10-year effort finally bore fruit today and Nepali airlines have been granted access to various international airports” says Pramod Nepal, Undersecretary at Ministry of Culture, Tourism and Civil Aviation (MoCTCA).

This decision comes after an exhausting 12-hour negotiation between both the nations’ government associations.

The Story Behind
Nepal approached Japan for the first time with the Bilateral Air Service Agreement (BASA) on June 2, 1994. After the two nations signed on the dotted line, 400 seats were allocated to Nepal on a weekly basis. However, the number of seats amounted to only 2 flights per week.

With this scenario, the Nepal Airplanes Corporation (NAC) was the only airlines operator to send flights from Kathmandu to Osaka through Shanghai in China until 2008.

Fast forward to 2018, Nepal will now see a multitude of its airline carriers operating flights between the two nations!

Doing the Math!
Since 1963, Nepal has signed ASAs with 38 countries including New Zealand, Vietnam, and India very recently. This amounts to 6 million seats per annum to and from the Himalayan country.

Currently, 29 international airlines are operating flights between Kathmandu and 22 cities across Asia and Europe.

In 2015, Airbus’ ‘Nepal’s Air Traffic Analysis’ envisioned a 77 percent growth for Japan-Nepal air traffic in five years. In 2017, Nepal hosted 27,326 Japanese visitors.

Nepal’s Ministry of Foreign Affairs estimates a number of 60,000 Nepalis in Japan presently, compared with 31,531 in 2013.

Nepali Airlines has access to major Japanese international airports including Kansai International Airport, Narita International Airport and Chubu Centrair International Airport, apart from 24 smaller international airports.

The Fifth Freedom
As per the ‘Fifth Freedom Traffic Rights’, Nepali airlines can operate three flights out of the 14 flights per week, i.e., Nepali flights can land in Hong Kong or airports in different countries, board passengers and continue to fly to Japan says Pramod.

The global ‘fifth freedom’ regulation provisions airlines to operate flights between foreign countries as part of their services connected to their respective home countries.

Read More:-

• Nepal Aviation Update: Nepal, India Negotiate for Better Air Connectivity

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The four routes that the sub-continent has agreed to make two-way include:

East Region

• Kathmandu-Biratnagar-Dhaka
• Kathmandu-Janakpur-Kolkata
• Kathmandu-Janakpur-Patna

West Region

• Kathmandu-Mahendranagar-Delhi

Now, Nepal carriers will be able to fly through the L626 route at heights ranging from 15,000-24,000ft. Following this, Nepali private air carriers such as Buddha Air will connect New Delhi with Nepalgunj.

This new development comes as a breakthrough for both nations, especially for Nepal that was concerned over easing traffic congestion in Simara Airport, which is a major destination for inbound flights in the country.

In this regard, the Civil Aviation Authority of Nepal (CAAN) and the Airport Authority of India (AAI) signed the MoU to conduct a safety assessment of the proposed routes. However, as per Nepal’s proposal, two vital entry points Nepalgunj and Mahendranagar are yet to be opened. India has agreed to probe further on the same by September 2018.

“Discussion on two vital entry points remained on hold, but overall the agreement is in fact a significant breakthrough,” said Deputy Director General of CAAN, Rajan Pokhrel.

“As per Nepal’s request for entry from the L626 route for high-level flights or flights above 24,000ft and another entry point from Nepalgunj, India agreed to make further examination by September 2018,” adds Pokhrel.

It may take a year before all the proposed air routes become functional.

The Background
Pending since 2014, the decision regarding the international air routes for Nepal didn’t take off due to several reasons.

First off, the decision took a halt when Nepal officials visited New Delhi in December 2016 to initiate negotiations, but returned with diverted attention over a public issue. Again, in February 2017, the two nations decided to form a technical team to resume talks, but ill-fate pursued when things didn’t materialize.

Finally, Nepal had welcomed a technical delegation from the Airports Authority of India (AAI) on June 14, 2018. 

As part of the discussion, the Civil Aviation Authority of Nepal (CAAN) and the AAI team discussed the prospects of three key border routes that Nepal suggested to India, i.e., Janakpur in the east, Nepalgunj in the mid-west and Mahendranagar in the far west regions.

Speaking about the project, an important CAAN official said, “We don’t know about the mandate that the Indian delegation has been entrusted with by its government, but we are prepared to sign a MoU if the discussions yield a positive outcome.”

The two teams agreed on collating a report after the safety assessment was completed by both nations’ technical teams and published to the Aeronautical Information Publication (AIP).

AAI team to Nepal was be led by Anil Kumar Dutta, member of Air Navigation Services (ANS) and board member of AAI.

New Projects Awaiting Nod
The latest agreement is crucial to many other infrastructure projects in the pipeline that are financially and technically dependent on it:

International Airport at Nijgadh:

Nepal is planning for the new airport at Nijgadh. Estimated at a budget of USD 1.2 million and spread across an area of about 7,000 hectares, the Nijgadh international airport will ease congestion at the Tribhuvan international airport at Kathmandu.

Nepal is also focusing on the construction of two important airports, USD 80 million Gautam Buddha Airport in Bhairahawa (by 2019) and the USD 16 million airport in Pokhara (by July 2021).

Airfares Experience Hike with Fuel Surcharge
In another recent update, domestic airfares spiked high as airlines spiraled the fuel surcharge in view of the costs incurred on fuel purchase.

On June 5, 2018, the Airline Operators Association of Nepal (AOAN) signaled a go-ahead to its members to increase market prices.

However, airlines personnel say that customers will not be able to feel the heat as they would rarely have to pay in full on account of the price war towards the end of the travel season.

Fuel Charges Post Hike
Nepal Oil Corporation (NOC) increased aviation fuel prices by Rs 5 per liter as compared with a two-year high of Rs 100 per liter.

The fuel surcharge on the ticket is increased by Rs 175, making the fuel surcharge Rs 440.

Post the increase in fuel surcharge, a normal flight between Kathmandu to Dhangadhi will cost Rs 12,870 including a fuel surcharge of Rs 4,410.

On a Positive Note:
With the recent Prime Minister visits to both countries, Nepal and India have joined hands to accelerate the growth of both nations by addressing concerns like this airspace issue. Looking at the pace of things followed by the agreement on opening international air routes to Nepal, we are sure that more of such agreements will boost the aviation sectors of both the nations.

Read More:–

• Nepal Airlines Update: Japan Opens All Air Gates for Nepal Flights

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This recognition came after Nepal’s successful efforts of resolving its safety oversight deficiencies and proper implementation of ICAO safety standards and policies in the year 2017.

Dr. Olumuyiwa Bernard Aliu, ICAO Council President presented the certificate to Rabindra Adhikari, Minister for Culture, Tourism and Civil Aviation at the ICAO Headquarter in Montreal, Canada.

Expressing their joy, Civil Aviation Authority of Nepal (CAAN) officials say receiving the ICAO Council President Certificate is a great achievement for them, especially when the country’s aviation safety is often put to question.

Adding further to this, Sanjiv Gautam, Director General of CAAN says, “Aviation safety in Nepal has progressed significantly in recent times and Council President Certificate from ICAO is the appreciation of the improvements we have made.”

Nepal is among the 14 countries including Indonesia, Bangladesh, Jordan, Kuwait and Romania who received the ICAO certification for their efforts over aviation safety in 2017.

Among other dignitaries present at the event, Mr. Sanjeev Gautham, Director General Civil Aviation Authority of Nepal was also available.

ICAO awards Council President Certificate to member nations on the basis of results of ICAO Universal Safety Oversight Audit Program, Continuous Monitoring Approach (USOAP CMA) activities, including audits, ICAO Coordinated Validation Missions (ICVMs) and off-site validation activities.

Also Read:

• Process Initiated to Delist Nepal Aviation from EU Blacklist
• Nepal, India Negotiate for Better Air Connectivity

The post Nepal Receives Prestigious ICAO Council President Certificate appeared first on Nepali Sansar.

In its updated air safety list released on December 01, 2017, the agency under the European Commission (EC) placed Nepal among 16 other nations that were prohibited from flying in the 28-nation bloc of the European Union (EU).

“All air carriers certified by the authorities with responsibility for regulatory oversight of Nepal have been banned from operating within EU,” reads a statement by the European Agency.

A total of 178 airlines were banned from flying in EU bloc as per the new list. These include 18 Nepali air carriers.

The list was prepared based on the feedback of aviation safety experts of the EU member states under the EU Air Safety Committee (EASC) chaired by EC and supported by the European Aviation Safety Agency, at a meeting held during November 13-15, 2017.

EU’s recent announcement comes as a disappointment to Nepali Airlines Corporation (NAC) that has been keen on launching its services in EU.

EU’s ban continues despite the lift of a ban by the International Civil Aviation Organization (ICAO) on Nepali airlines owing to their non-compliance to ICAO’s eight critical protocols.

ICAO later excluded Nepal from its Significant Safety Concern (SSC) list in July 20, 2017 supporting Nepali Airlines Corporation’s move to launch flights in Europe.

Need for Improvement in Air Safety Concerns

Stakeholders of the Nepali aviation sector feel that EU’s move might be a consequence of the Nepali Ministry of Culture, Tourism and Civil Aviation’s (MoCA) decision to summon the Civil Aviation Authority of Nepal (CAAN) Director General.

However, EC clarified that the assessment was made considering the international and ICAO’s safety standards.

“Why did responsible senior officials fail to approach EC to defend Nepal during the safety committee deliberations?” questions a Nepal Airlines Corporation official in response to the decision.

The official further informed that Nepali airlines are capable of meeting the international standards and the issues arose because of the lack of improvement in the concerned regulatory body operating under MoCA.

The official was disappointed at the arrival of such decision at a time when the country is aiming at one million annual tourist target and NAC is keen on operating two wide-body aircraft to European countries.

EASC’s next meeting to announce the air safety update list will take place during May-June 2018.

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