Nepal Airlines: Revamp or close down

Nepal Airlines: Revamp or close down
eKantipur.com, 16-May-07
BY KRISHNA REGMI

There is a demand of air seats from passengers as well as supply of aircraft from manufacturers, yet fleet expansion of troubled national flag carrier has always been a pipedream.

Purchasing aircraft for Nepal Airlines Corporation (NAC) is like a political hot potato because of the previous controversial deals, in which power players lined their pockets.

Since the early 1990s, there were efforts to buy aircraft, but all of them ended just by forming a committee and submitting reports. It has been a routine for years: when a new minister at the Ministry Civil Aviation assumes office, he makes a loud proclamation to buy aircraft and constitute a committee. Still, the ill-fated NAC continues to languish with only a pair of over two-decade old aircraft.

Look at the one episode in a series of dramas that were staged in the past. In 1993, the corporation transferred over a dozen pilots from domestic sector to international to fly 'soon-to-arrive aircraft'. Even after 14 years no one knows what happened to the plan and why the new aircraft never showed up.

Its not that business opportunities are slim. In fact, NAC has immense potentials as indicated by facts that international airlines flying to Nepal are packed. In addition, many aspirant tourists are unable to travel just because they don't get air seats.

Arranging necessary financial resource is not a big deal as well. Financial institutions have already expressed their willingness to extend loans to purchase aircraft.

Because of the inefficient management and lack of commitment of successive tourism ministers, NAC is not only fighting the battle of its very existence but the whole tourism industry has also become a victim.

“Concerned NAC officials fear that they may be left out on the share of commissions. So they obstruct every effort to acquire aircraft,” said an official at the MoCTCA.

He said that the inefficient and incompetent management is the single biggest hurdle to NAC's fleet expansion.

The financial regulations of NAC endow its management full authority to execute all tasks pertaining to aircraft purchase, including preparation of a report on aircraft selection.

Around three years ago, then management tabled a proposal to the board to buy two Boeing-737 aircraft. “But, the board remained indecisive for months, as they were not sure about continuity of their tenures. They chose not to take risks by getting involved in the aircraft deal,” said the employee. “The lobby from rival Airbus agent might have also worked.”

The ministers also do not bother until they have a chance to install their staunch supporters to the top position at NAC, he said. He said there needs a greater reform on the management and most of its employees should be relieved of their jobs through volunteer retirement scheme to clear the way for aircraft purchase.