PAC tells NAC not to buy aircraft

The Public Accounts Committee (PAC) today asked Minister for Tourism and Civil Aviation Sharad Singh Bhandari to improve the management of the ailing national flag carrier rather than buy new aircraft.
Nepal Airlines Corporation (NAC) is planning to buy wide-body aircraft. "A committee formed to study the need to buy new aircraft has raised serious questions about the necessity of buying widebody aircraft," said PAC members. "However, buying narrow body aircraft might make it easier to start regional flights according to the revised Air Service Agreement (ASA) between Nepal and India," it added.
Bhandari, however, reasoned that the new aircraft are the need of the hour as the country is celebrating Nepal Tourism Year 2011 and the number of present aircraft is not enough. There are two old aircraft -- Boeing 747s -- with NAC, of which only one is in operation currently.NAC has also raised questions about the process of the aircraft purchase. According to PAC, it is not in accordance with economic regulations of NAC.
The minister accepted that the confusion over the executive power of chairman Sugat Ratna Kansakar and general manager KB Gurung has hindered the smooth operation of NAC. "Once the court gives a verdict clearing the confusion, the issue will be resolved," he said.
The government has appointed Kansakar executive chairman. Earlier, Limbu was managing director and enjoying the executive rights. Managing director captain Kul Bahadur has moved the SC asking for a stay order against the appointment of Sugat Ratna Kansakar as executive chairman. The present government appointed Kansakar executive chairman on July 26.Dr Prakash Chandra Lohani, joint chairman of Rastriya Janashakti Party and Hridayesh Tripathi, both members of the PAC had warned NAC of the negative consequencies of buying aircraft.
Ailing NAC has been planning to add new aircraft in its domestic fleet also. On the domestic routes NAC is flying its four DHC-6-Twin Otter aircraft that each have 19-seat capacity, though it has seven Twin OttersApart from the two much-talked wide-body aircraft, NAC also had planned to add six aircraft on international routes. Currently, on international routes NAC is flying a Boeing B-757 and a Boeing 757-200 aircraft -- Karnali and Gandaki -- each with 190-seat capacity. The then Royal Nepal Airlines Corporation (RNAC) -- and present NAC -- had taken two Boeing 757s -- Karnali on lease in 1987 and Gandaki in 1988.
The national flag carrier has incurred an operating loss of around Rs 50 million in the fiscal year 2008-09 due to unavailability of one of the aircraft for maintanance and hiked fuel price reasons.