In a letter to MoTCA on Wednesday, MoF suggested MoTCA direct NAC to recover the lock-up money of $750,000 forwarded to aircraft manufacturer Airbus. MoF has also asked MoTCA to recover the money with interest from the officials concerned if Airbus refuses to return the lock-up money. [break]
A ministerial-level decision taken by MoF on May 24 concluded that the aircraft purchase and selection process was not as per the existing law, citing a similar conclusion reached in the case by the Public Accounts Committee.
The MoF decision has recommended adherence to the Center For Pacific Aviation (CAPA) report on management reform at NAC and initiation of another purchase process for new aircraft to be operated in profitable sectors.
MoTCA had sent a letter to MoF on November 8, 2009 seeking government guarantees for loans to purchase new aircraft for NAC. MoF made the recommendations in response to MoTCA´s letter.
"We received the MoF letter on June 1. The opinion reached after discussions with the tourism minister will be as a directive for Nepal Airlines Corporation", Ranjan Krishna Aryal, acting secretary at MoTCA, told myrepublica.com. According to him, MoTCA has not taken any decision after receiving the MoF letter.
According to sources, KB Limbu, managing director of NAC, had received a copy of the letter before it reached MoTCA.
"Before acceptance of tender in the purchase process for new aircraft, financial closure and a decision on the Nepal government´s guarantee should be completed", the letter states.
However, an official at NAC said on condition of anonymity,"The aircraft purchasing process is not against the law as MoF is claiming and we have taken steps as per the Public Procurement Act."
He said,"MoF has failed to explain how it has violated the existing legal provisions and we have not understood it yet." According to him, the aircraft purchase process was forwarded following the financial regulations of NAC.
PAC had also given directions to the government to cancel the aircraft purchase process for NAC, on Dec 28, 2009. NAC has to operate international flights with its two 20-year-old Boeing B757s.
According to tourism entrepreneurs, the MoF decision will affect the government´s plans to celebrate Nepal Tourism Year 2011 as a mission to bring in one million tourists that year.
On Oct 2, 2009, NAC had decided to buy a wide-body Airbus A330-200 and a narrow-body A320-200. The committee formed under the coordination of then Joint Secretary Bimal Wagle had set eight conditions before NAC for a government guarantee for loans.
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