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Nepal Airlines Gets Six Chinese Aircrafts
By KTM metro Reporter
November 29, 2013: the government of Nepal, and China have signed off yesterday the Framework Agreement on Provision of Concession Loan Assistance, Economic and Technical Cooperation Agreement for Grant Assistance, and a Letter of Exchange, and also the Government Concession Loan Agreement with the Export-Import Bank of China, the major financial supporter in the Nepal Airlines purchasing six aircraft from China, according to the Xinhua news.
With the signing of the agreements, Nepal will acquire two aircraft - 19-seater Harbin Y12E and 58-seater Modern Ark 60 (MA60) - on grant and three-Harbin Y12E and a MA60 on concession loan.
The Chinese government has agreed to provide grant and concession loan of 408 million yuan (approximately 6.7 billion Nepalese currency) to acquire and purchase six China made aircraft.
The grant assistance of 180 million yuan (approximately 2.9 billion Nepalese currency) will be for acquiring one MA 60 and one Y12E aircraft; and up to 228 million yuan (approximately 3.7 billion Nepalese currency) loan will be for purchasing one MA60 and three Y12E aircraft.
"These aircraft will play a crucial role in the development of both the nation and NAC," said Madan Kharel, managing director of Nepal Airlines Corporation (NAC). The Aviation Ministry sources said that the country would receive at least two out of the total six aircraft within three months.
All of the China-made aircrafts will be deployed for domestic flights connecting a number of destinations including Biratnagar, Pokhara, Bhairawaha, Bhadrapur, Dhangadi and Nepalgunj, directly from Kathmandu after one and a half decade of suspending the operations in these destinations.
NAC also has envisioned two to nine flights a week in remote destinations and three to nine flights to urban destinations with the Chinese aircraft.
"This is the last chance so as to prevent the downfall of financially and managerially tattered NAC," Ranjan Aryal, joint secretary to the aviation ministry told Xinhua. Aryal, a key figure during the negotiation of the aircraft deal, stated that NAC should come aggressively as a fierce competitor to the private sector airline operators and develop the norms of corporate culture for steady growth.
NAC has however come up with ambitious plan even before receiving the aircraft. "Our purpose is to capture at least 40 percent of the share in both domestic and international markets within seven years," Ganesh Bhadur Chand, corporate director of NAC, told Xinhua, adding that NAC will have around 25 percent of the market stake within a couple of years.
Along with the six Chinese aircraft, NAC plans to bring in service at least a dozen planes within a year by maintaining its grounded planes.
