Submit your Article

Nepal is seeing the first diplomatic visit of 2024 from India. Indian External Affairs Minister S Jaishankar is arriving in Kathmandu for a two-day visit on Jan 4.

Jaishankar will lead the Indian delegation in the 7th meeting of the Nepal-India Joint Commission—the highest bilateral mechanism between the two countries. The delegation will include Indian Foreign Secretary Vinay Mohan Kwatra, Anurag Srivastava, Nepal desk chief at the Indian External Affairs Ministry, and other high-level officials.

Among the key agendas of the meeting is the formal signing of the Power Purchase Agreement (PPA) which will pave the way for India to import 10,000 MW of hydropower from Nepal in 10 years, energy ministry officials say. The 11th meeting of the Nepal-India Joint Steering Committee in Chitwan will finalize the agreement. However, secretaries of both countries have yet to sign the agreement to formalize the long-term PPA.

The preliminary agreement for the long-term PPA was signed in June. It was endorsed by the Indian cabinet in September. Nepal had presented the draft of the long-term PPA to India during Prime Minister Pushpa Kamal Dahal’s visit to the southern neighbor from May 31 to June 3.

Pancheshwar in limbo

High-ranking government sources reveal that the upcoming diplomatic visit will not make progress on the Joint Detailed Study Report (DPR) of the Pancheshwar Multipurpose Project.

Despite being proposed nearly seven decades ago, the Pancheshwar project still remains confined to paper. A former Indian ambassador to Nepal expressed skepticism about the project, stating that neither country is genuinely committed to advancing the project. Despite being a recurring topic in high-level discussions, there is a lack of genuine commitment from Nepal and India to implement this mega project, he added.

An official from Nepal’s energy ministry echoed the sentiment. “The project won’t move forward without political commitment. The joint mechanism between the two countries cannot resolve the issue,” he added.

While the initial disagreements on the joint DPR of the project numbered over 500, most of them have been sorted out. The two sides reportedly have differences or just two or three issues now. Both nations have struggled to form a common stance on water use. “The project has been stalled because the countries are prioritizing self-interests over bilateral concerns regarding water usage,” the energy ministry official said.

India first identified the Pancheshwar Project on the Mahakali River, which serves as the border between the two countries, in 1956. The two countries decided to form a joint team to study the project in 1978. Nepal established the Pancheshwar Multipurpose Project Office in 1988. The 1991 Pancheshwar Multipurpose Project Report stated that 6,720 MW of hydropower can be generated - 6,480 MW by building a 315-meter rock-filled dam at Pancheshwar, and an additional 240 MW by building an 83-meter regulating dam at Rupaligad. Nepal prepared the Detailed Project Report (DPR) for the project in 1995 based on the findings and insights derived from the 1991 report.

Nepal and India signed the Mahakali Treaty for the integrated development of the Mahakali River, which included Sarada barrage, Tanakpur barrage and Pancheshwar Dam Project, on 12 Feb 1996.

In 2009, Nepal and India agreed to form the Pancheshwar Development Authority to implement the project. In 2014, WAPCOS Limited, a government undertaking of India, was assigned to prepare a joint DPR by studying separated DPR prepared by the two countries. WAPCOS submitted the DPR in 2016. However, differences arose between the two countries on the DPR as it reportedly contradicted the Mahakali Treaty signed by the two countries. An agreement was reached to finalize the DPR within three months during Dahal’s India visit. However, there has been no progress even though it has already been seven months since the agreement was reached. 

The project also aims to control floods in Kanchanpur district and irrigate 93,000 hectares in Kanchanpur and 1.6m hectares in India.

Nepal Airlines Corporation (NAC) is facing prolonged grounding of its aircraft while its loan burden continues to escalate.

NAC has obtained loans at a 10 percent interest rate to finance the acquisition of two Airbus A320 and two Airbus A330 aircraft. The ratio of the national flag carrier’s total loans to equity currently stands at 11.17. NAC has been operating flights to 11 international destinations, including New Delhi, Mumbai, Bangalore, Bangkok, Hong Kong, Qatar, Malaysia, Tokyo, and Dubai, using these four aircraft.

The national flag carrier’s long-term loans have exceeded Rs 47bn. This means that, with an annual allocation of Rs 5bn for loan repayments, it would take NAC a decade to clear its debt. However, given its financial situation, it is likely that the debt will continue to accumulate. In the fiscal year 2022/23, NAC’s revenue was Rs 16bn, while its operating expenses amounted to Rs 18bn.

One of the main reasons for this financial struggle is the prolonged grounding of its aircraft. NAC’s aircraft were grounded 21 times between February and September. Of these, Airbus A320 aircraft were grounded 15 times, while Airbus A330 aircraft couldn’t be airborne six times.

Deputy Spokesperson of the Civil Aviation Authority of Nepal (CAAN), Gyanendra Bhul, stated that minor technical problems causing short groundings are not always reported to CAAN. “The reasons for grounding vary. Both narrowbody and widebody aircraft are frequently grounded due to technical and managerial weaknesses,” he added.

Last year, an Airbus A320 with callsign 9N-AKW remained grounded in Doha for 45 days and in Kathmandu airport for 52, 27, and 21 days, according to a source at the NAC. The inability to procure an engine is cited as the reason for these extended groundings. Occasional minor problems every few months are acceptable, but NAC is experiencing repeated and frequent aircraft groundings. According to NAC, its aircraft missed nearly 50 percent of scheduled flights between mid-May and mid-June.

Revenue loss

In the two-month period between mid-April and mid-June, NAC generated revenue of Rs 2.19bn from its four aircraft. During this time, NAC was only able to operate approximately half of its scheduled flights, according to NAC’s in-house publication, ‘Shwet Bhairab’.

NAC estimates that each aircraft generates an average daily revenue of Rs 10m. This means NAC incurs a minimum loss of Rs 10m when an aircraft remains grounded for a day. In addition to the loss of revenue from ticket sales, NAC also has to pay parking fees to airport operators. If a new engine is leased as a replacement, the losses escalate. When all these expenses are factored in, the average daily loss for each day an aircraft is grounded comes to Rs 15m. According to an engineer of the NAC, aircraft are becoming grounded due to negligence and ill-intentions of the NAC management. “Instead of promptly addressing issues, they often seek kickbacks and commissions, resulting in prolonged grounding,” he added.

Long-term agreement with erring firm

NAC has signed a six-year agreement with Israel Aerospace Industries (IAI) for engine overhaul and engine leasing for Airbus A320 aircraft. The four-year agreement signed in August of the previous year includes a clause allowing for an additional two-year extension. IAI took 18 months to repair an Airbus A320 aircraft with call sign 9N-AIX. Although the estimated cost was Rs 360m, NAC paid the company Rs 430m without proper invoicing.

The Israeli firm also took seven months to repair the engine of the aircraft with call sign 9N-AKW, which malfunctioned in Doha, Qatar. Engine repairs should typically take around three months. NAC’s regulations also state that engines should be repaired within 90 days. The firm consistently failing to meet this timeframe should have been blacklisted. However, NAC’s decision to enter a long-term agreement with the firm has raised suspicions of irregularities, according to NAC sources. They suggest that engine repairs are intentionally delayed to extend engine leases and secure commissions.

According to the contract with IAI, the Israeli firm should inform NAC management if parts worth more than $65 need to be replaced. However, NAC engineers claim that IAI does not provide prior information before replacing parts. An NAC engineer mentioned that the engine leasing fee amounts to approximately Rs 1.5m per day. According to the engineer, NAC incurred a loss of Rs 5m after IAI installed an engine with the wrong type certification in an aircraft with call sign 9N-AKX. “This resulted in a loss of Rs 2.5m. Another Rs 2.5m will be required to install an engine certified for the Airbus A320,” he added.

Reasons for aircraft groundings

Aircraft manufacturers provide standard operating procedures (SOPs) to operators, specifying the validity of parts and when they should be replaced. Similarly, Technical Manuals (TMs) specify when parts should be sent for maintenance. Some parts need overhauling every three months, regardless of their condition. Certain parts require inspection after every flight. Engineers licensed by CAAN must certify daily inspection (DI) reports. Additionally, the pilot-in-command should inspect the aircraft before each flight and can request re-inspection if any doubts arise.

According to Bhul, aircraft become grounded when standard operating procedures and training manuals are not followed, and necessary spare parts are not available. “The increasing frequency of aircraft becoming grounded is mainly due to a lack of efficient management,” he added. A senior official at the Ministry of Culture, Tourism, and Civil Aviation cited the frequent aircraft groundings as a result of delayed maintenance and repairs, coupled with a failure to follow standard procedures. “To be honest, we don’t have any definitive answers. Therefore, we cannot pinpoint the exact causes of the problem,” he stated.

A study has estimated the cost of building the Kathmandu-Raxaul electric railway line at around Rs 400bn.

The report of the Final Location Survey (FLS) conducted by the Indian government has put the estimated cost of the project at Rs 400bn, government officials say.

The Indian government has forwarded the report to the government for approval. The survey was conducted with financial and technical support from India. The two countries signed the survey agreement in September 2021, giving a timeframe of 18 months.

Earlier, the Indian government had conducted the Preliminary Engineering Cum Traffic (PET) Survey and submitted its report to the Nepali government. The survey had estimated the cost at Rs 250bn.

Both the PET and LFS surveys were conducted by the Konkan Railway Corporation, a Government of India undertaking. “The PET survey had estimated the total length at 136 kilometers, but the recent LFS survey report states that the total length will be 140 km. The length increased a bit to avoid the proposed location of the Nijgadh International Airport,” said Senior Divisional Engineer Aman Chitrakar, spokesperson for the Department of Railways.

According to the survey report, there will be 13 stations between Raxaul and Kathmandu, with the train passing through Bara, Parsa, and Makwanpur to reach the final station at Chobhar. Given the route’s hilly terrain, the project will involve the construction of numerous bridges and tunnels. About 41 km of the railway line will pass through tunnels. India has proposed building the railway line in broad gauge, allowing for a maximum speed of 120 km per hour.

With the survey report completed, the government will now initiate discussions on the investment modality. While Nepal had proposed India to build the line in standard gauge, which is used worldwide, India has insisted on constructing it in broad gauge. This may pose difficulties later on as Nepal prepares to build the East-West railway and Kerung-Kathmandu railway in standard gauge. According to Chitrakar, even India is building new railway lines in its territory in standard gauge.

The Nepal Electricity Authority (NEA) is facing challenges in ensuring a steady supply of electricity due to delays in the construction of two transmission lines. As a result, both industrial and household consumers are experiencing power cuts, despite the NEA having surplus electricity during the rainy season. NEA officials have stated that the intermittent power cuts are a direct result of the delay in constructing the transmission lines. The construction of the Hetauda-Dhalkebar-Inaruwa 400 kV and Hetauda-Bharatpur-Bardaghat 220 kV transmission lines has been ongoing for more than a decade, far beyond the originally planned completion time of three years. “The NEA’s system is under pressure due to the delay in these two transmission lines,” said Dirghayu Shrestha, the chief of the Transmission Directorate at NEA. “These projects have faced obstacles from the local community and have also been subjected to court-issued stay orders. Completing these transmission lines would have significantly increased our distribution capacity.” Due to the delay in constructing high-capacity transmission lines, the NEA is currently transmitting only around 80 MW using its old transmission system. The new lines would have supported the transmission of up to 300 MW. The construction of a 400 kV transmission line is essential for transmitting electricity to western Nepal from the Dhalkebar substation. The existing 132 kV transmission line in Hetauda is unable to carry sufficient electricity to supply the western region. As a result, NEA is unable to meet the demand and purchase electricity from independent power producers. Both transmission line projects were started with loan assistance from the World Bank. However, due to the construction delays, the World Bank withdrew from the projects in 2021. The World Bank had originally provided a $138 million concessional loan to fund the transmission lines, with the expectation that the projects would be completed within three years. While the contractor for the 400 kV transmission line was awarded the project in 2011, the contractor for the 220 kV transmission line was selected in 2009. Hetauda-Dhalkebar-Inaruwa 400 kV The NEA has prioritized the Hetauda-Dhalkebar-Inaruwa transmission line for strengthening its transmission network and facilitating power trade with India. “This trunkline is crucial for importing power from India and supplying it to industrial corridors in Birgunj and Biratnagar,” said Shyam Kumar Yadav, chief of the Hetauda-Dhalkebar-Inaruwa 400 kV project. Yadav added that the transmission line, to be built under the US government’s MCC project, will be connected to this trunk line. The project involves the installation of 792 towers. However, the project has faced challenges in constructing eight towers in Sarlahi and 25 towers in Makwanpur due to protests of the local people. “The locals are requesting a change in the transmission line’s route, but it is not feasible at this point,” added Yadav. The transmission line is being built by a joint venture between Angelique International from India and LTD from Germany. The project was initially estimated to be completed in 30 months, but it faced a four-year delay in obtaining forest clearance and an additional four years due to a court case. “If there are no further obstructions, we expect to charge the Inaruwa-Dhalkebar section of this transmission line within five months,” stated Yadav. “The completion of the Dhalkebar-Hetauda section is estimated to take one and a half years.” Hetauda-Bharatpur-Bardaghat 220 kV According to Santosh Sah, Chief of the Hetauda-Bharatpur-Bardaghat 220 kV transmission line project, one of the circuits of the double-circuit 220 kV transmission line will be operational within two weeks. “Currently, testing is underway on the Hetauda-Bharatpur section. Once this section is operational, NEA will be able to transmit 160 MW through this segment,” Sah stated. The Bharatpur-Bardaghat section is expected to be ready within three months. Out of the two remaining towers to be erected on this section, the first one is ready, and work is underway on the second tower. “Within 15 days of completing the tower construction, we will be able to install the wires,” Sah added. The project, originally estimated to be completed in 21 months, has experienced a delay of 14 years.

Many young people aspire to pursue higher education abroad after completing Grade 12. Often, they believe that there are limited opportunities in Nepal, and look to migrate to foreign countries. However, Sandesh Subedi from Kushma, Parbat, holds a different opinion. Instead, he is actively serving his nation by spearheading a campaign for blood donation. Sandesh knew about the significance of blood in human life during a critical period in his own family. When he was in Grade 6, his mother was diagnosed with a brain tumor, and their family faced a shortage of blood for her treatment. Tragically, Sandesh’s mother eventually passed away. However, this experience inspired Sandesh to honor her memory by actively engaging in blood donation. “I realized the critical need for blood when my mother was undergoing treatment at Neuro Hospital in Kathmandu. It was difficult for our family to arrange blood during that period,” Sandesh shared. Sandesh has taken a unique approach to spearhead his campaign by combining it with cycling. The inspiration to incorporate cycling into his mission came to him when he had the opportunity to meet world cyclist Ajit Baral. Recognizing the numerous health benefits associated with cycling, Sandesh saw it as the perfect medium to promote his blood donation campaign. “After meeting Ajit, I was inspired to use cycling as a means to advocate for blood donation,” Sandesh shares. Not only does cycling promote physical well-being, but it also provides an excellent platform to raise awareness on the importance of donating blood, he added. “If a patient needs blood, it has to be given by somebody. If you don’t donate blood, it doesn’t mean you will have excess blood in your system. Similarly, donating blood does not deplete your own blood supply,” Sandesh said, adding, “A person can donate 350ml of blood at a time, and it can be preserved for three to four weeks, providing a valuable resource for those in need.” “Contrary to misconceptions, blood donation does not harm the body. The donated blood replenishes within 24 hours. Individuals in the age group of 18-60, weighing more than 45 kg, and in good health without any chronic diseases can donate blood. After donating once, it is possible to donate blood again after three months.” During his journey, Sandesh shares these vital pieces of information with the people he meets. "It is important for people to understand that even if we don't donate blood, it will eventually get destroyed within our bodies," he stated. “It is important to educate people and debunk the misconceptions surrounding blood donation. Many individuals still hold the wrong belief that donating blood will make them weak. Meanwhile, countless lives are being lost due to blood shortages." Sandesh successfully completed the 1,028-kilometer journey in one month. During the trip, he managed to actively engage 558 individuals in the blood donation program. During the trip, Sandesh received memberships of Nepal Red Cross Society and the Nepal Blood Donors' Society. “The support and encouragement of these organizations played a significant role in motivating me throughout the journey," he added. Collaborating with the youth, students, and local communities, Sandesh took the initiative to organize awareness programs about blood donation in various parts of the country. "Blood donation brings about dual benefits," Sandesh explained. "Firstly, when one donates blood that would otherwise be naturally destroyed within the body, it revitalizes the donor's own system. Secondly, and most importantly, it saves lives." Sandesh believes that blood donation is one of the most profound acts of service that one can perform. Reflecting on his journey and the impact of his campaign, he said, "Throughout this endeavor, I have been blessed with the gratitude of numerous people. Even though my own mother departed this world prematurely, I take solace in knowing that I have fulfilled her dream as she used to tell me social service is the greatest religion.” Sandesh has compiled an extensive list of activities pertaining to blood donation. He aims to expand the reach of his campaign to districts that were not covered during the Mechi-Mahakali cycling tour. His primary goal is to raise awareness and educate people in those areas about the importance of donating blood.  

The Civil Aviation Authority has formed a committee to recommend possible actions against airliners charging passengers exorbitantly citing the Covid-19 pandemic and various restrictions on mobility.

The five-member committee, led by Director-General Rajan Pokharel, was formed to look into prevailing legal provisions to take action against such airlines as the law against profiteering and black marketing was found to lack teeth in such matters.

“After we receive a report from the committee, we can decide the course of action against airlines that are fleecing passengers,” says an official at the authority requesting anonymity.

Following the emergence of the second wave of Covid-19 infections in Nepal and India, international airlines have considerably reduced the frequency of flights to the region. With passengers competing for limited seats, the airlines have hiked fares on almost all routes, says Sudhir Upadhyaya, general secretary at Nepal Association of Tour and Travel Agents.

Although prevailing laws outlaw profiteering on domestic routes, they can’t be used against international airlines, the official says, adding that the committee may recommend new laws to deal with the issue. International flights tickets are booked on the concerned airlines’ global ticketing system—this means passengers from all over the world compete for a seat on the plane.

According to passengers and ticketing agents, a return ticket to Australia could be bought for around Rs 80,000 until a few months ago. But the fare has now gone up to over Rs 120,000. Fares have also been increased for tickets to the Gulf, US, and Europe. Migrant workers spend more than a month of their salary to buy a ticket home or return to work. Students going abroad have also been affected as they face a tight deadline to join their universities.

Says Pokharel, “As of now, we don’t have concrete laws against profiteering in the airline business.”

The issue of exorbitant ticket prices has been a topic of discussion among officials from CAAN, the city police, and even the Ministry of Home Affairs. All the agencies have received complaints about expensive international flight tickets. “We will write to the Home Ministry on the committee’s recommendations when we finalize the report,” says Pokharel. 

Twenty-three people have so far filed complaints against various airlines for overcharging. The committee, which will also look at the complaints, has been busy discussing the issue with airline operators, ticketing agents, experts, and foreign employment recruitment agencies.

Critics argue that it might be too late until the committee prepares its recommendations and new laws are formulated. Until then,  Nepali passengers will have to continue shelling out a lot of money for international travel.

Nepal’s hotel industry, badly hit by the Covid-19 pandemic, is trying to recuperate and is getting ready to welcome tourists with the arrival of the Gregorian New Year. In the previous years, a big mass of tourists entered Nepal from India and other countries to celebrate New Year, making December-January one of the busiest periods for Nepali tourism.

Nepali hoteliers have adopted elaborate physical distancing and other health protocols in the hope of attracting more tourists to New Year celebration events. Hotel entrepreneurs from Pokhara, Chitwan and Kathmandu have unveiled attractive packages targeting the New Year. The star hotels Soaltee, Hyatt, Yak & Yeti and Shangri-La in Kathmandu valley are all preparing for an increased number of guests. The recent closure of Hotel Annapurna—one of the oldest five stars in the country—highlighted the vulnerability of Nepal’s hotel industry.

“Until last year, the number of foreign tourists coming to Nepal to celebrate New Year was very high,” says Vinayak Shah, senior vice-president of the Hotel Association of Nepal (HAN). Shah informs that this year hotels plan on welcoming mostly domestic tourists, with international arrivals not expected in the immediate future. Hoteliers had made similar preparations for Christmas, but the returns were not satisfactory, Shah adds.

Despite the failure of Christmas to boost their businesses much, hotel entrepreneurs are still pumped up for New Year. They have introduced multiple discount packages to cater to all types of domestic tourists. Shah hopes people who have stayed at home all through the year will come out to celebrate—on the New Year day, and weeks thereafter.

Of late, the Gregorian New Year is celebrated like a festival in all major cities of Nepal. Families have made it a custom to go out to celebrate at hotels, restaurants and picnic spots. Hence New Year is considered a lucrative time for hotels and restaurants. So despite Covid-19 destroying most business opportunities this year, the New Year is still expected to bring some respite.

“The young generation no longer fears Covid. They have started going around and they have also added to the vibrancy of night life,” says Araniko Rajbhandari, president of the Restaurant and Bar Association Nepal (REBAN). Rajbhandari adds that the hotel and restaurant businesses have greatly benefitted from the withdrawal of odd/even vehicle rule. There is also more hope with almost all private and government offices coming back into operation. For restaurants, Christmas-time sales were satisfactory, Rajbhandari says, hoping the same is the case for New Year.

Rajbhandari also informs that entrepreneurs expect around 60 percent occupancy in the New Year. However, the Thamel area—the main tourist attraction in Kathmandu—remained quite deserted on Christmas Eve, making otherwise hopeful entrepreneurs a little skeptic. So REBAN has requested police administration to be more lenient to late night businesses with New Year celebrations in mind. On New Year Eve, most events and activities are conducted till late night or early next morning.

Domestic flights in the country are still short of passengers. Nepali airline operators suspect prospective passengers might not be ready to travel in the middle of the Covid-19 pandemic. In previous years, Dashain bookings were done at least a month in advance but now there are only a few enquiries and not many passengers. There is the case with under two weeks to the start of the festival.

Regular domestic flights across the country only began on September 20 after six months of suspension. In the 15 days since daily flights resumed, there has been an occupancy rate of around 85 percent of capacity. Right now, only a quarter of all regular flights have resumed. Occupancy is said to be increasing on the trunk routes (flight to the lowlands) rather than the stall routes (high altitude areas). There are more cargo than passenger flights on stall routes.

The Civil Aviation Authority of Nepal currently allows about 80 daily flights from airlines such as Buddha, Yeti, Simrik, Shree, Sita, Tara, Summit, and Nepal Airlines. Buddha and Yeti Airlines have been flying on the trunk routes while Sita, Tara, Summit and Nepal Airlines have been plying the stall routes. Simrik Airlines informs that it will start two daily flights to Pokhara alone from October 15.

According to CAAN’s flight schedule, Buddha Air gets to fly 30 flights a day. At present, it has around 85 percent flight occupancy, spokesperson and marketing manager for the airlines Rupesh Joshi informs.

Even now, bookings are made only one day before the flight, Joshi informs, adding that nothing can be said for Dashain yet. “There may be some excitement in passengers from Ghatasthapana [October 17]. If passenger pressure decreases, airfares may reduce, but if the pressure increases, the current fares remain. But we have no plans targeting Dashain yet,” says Joshi.

The occupancy of Yeti Airlines is currently around 90 percent, informs Sudarshan Bartaula, flight safety chief and spokesperson. Yeti Airlines, which is flying about 18 flights a day on trunk routes, has not started bookings for Dashain. “We have not introduced cheap fares for Dashain as yet. We are in a wait-and-see mode. It is impossible to foresee passenger pressure in Dashain,” says Bartaula.

Bartaula attributes lack of booking to the common mentality that seats will be easily available till the last moment. Stating that flights are currently being operated at cheaper rates, Bartaula adds the airlines are struggling to raise operating expenses. He adds that there is no possibility of further reducing fares. Even though there are no advance bookings, Yeti Airlines hopes daily flights will be filled by Dashain.