Airlines Merger

 

As TR Manandhar, Director General of CAAN, said (New Business Age, April 2013) the number of airlines is higher than what the  market can sustain. In a condition where tourism is not yet at a peak, the domestic market for aviation in Nepal is still untapped and some rural destinations can be developed that can be reached more conveniently by air than by land.  Airlines have been facing problems in generating profits because of the high operational cost and inadequate capital base. In the current situation, as Manandhar suggests, it would be wise to merge airline companies. That would increase the fleet size, the capital base and the reach. The merger of companies  would also help them operate by being one robust company.

Binita Sharma, Pokhara