July 11: Nepal Airlines Corporation (NAC) is preparing to hand over its management to a private company on contract basis through a global tender.
The debt-ridden airline adopted this strategy after the government turned down its request to provide financial assistance of Rs 20 billion to repay the loan it had taken to purchase new aircraft some time ago.
The state-owned airline is struggling to repay the installment of the loan it took to purchase two new Airbus.
NAC has formed a five-member experts’ committee headed by its former director Raju Bahadur KC in this regard. The committee has been asked to submit a report on the modality of contract within 10 days, informed Nawaraj Koirala, spokesperson of NAC.
“It is a long process to select a strategic partner. It might take a long time for this,” said Koirala, adding, “Our airline requires policy-level improvement in some issues. But there is no problem in handing over the management to the private sector on contract basis.”
Once the experts’ committee submits its report, a discussion will be held at the board meeting of the NAC. The state-owned airline will forward the process to the concerned ministry after the decision gets approval from the board meeting. Koirala informed New Business Age that the process to initiate a global tender will be initiated after getting the green signal from the ministry.
He further said that the NAC is preparing to hand over the management of the engineering, operations and marketing departments to the private sector for the time being.