Civil Aviation Authority of Nepal (CAAN), the aviation regulator, has decided to raise airport service charges for domestic carriers, something which it has not done for the past five years. CAAN has already initiated process for fixing new rates, according to a source. [break]
“It has already been five years since we revised the rates, and that is too long a time. Besides, the current rates are too meager,” said the source, elaborating on CAAN´s decision to jack up the charges for services like, landing, navigation and parking for domestic airlines.
Presently, CAAN is levying about Rs 300 per aircraft as landing service charge and the rates for other services are also in the similar range. Going by the Airport Charges Regulations (ACR), the rates multiply as per the weight of the aircraft.
“But since the base rates are too low, the service charges that the companies pay in total now stand nowhere near what civil aviation authorities in other countries charge,” said the source.
CAAN has already initiated consultations with the concerned stakeholders to jack up the rates. The aviation regulator argues that its latest vision is to adopt ´cost-recovery principle´ in its operations.
Being responsible to manage and operate 55 airports across the country, it invests a huge amount of money for infrastructure building and repair and maintenance works. In the absence of other sources of income, the government has been pushing it to realize the investment by levying the service charges in according rates.
“Present rates are far too less to generate any return to those investment. Hence, we will revise the rates according to the cost recovery principle," said the source.
However, the rates for the international airlines will not be changed. “Rates imposed to international airlines are already competitive with the international standard,” said the source.
The latest initiatives of CAAN will straight away impact all 23 domestic airline companies currently in operation. Of the 23 companies, eight are passenger airlines, six helicopter operators and nine paragliding companies.
CAAN has extension of its airport infrastructure at 55 places. But only 35 of them are operational at present. Though CAAN was made an autonomous institution about a decade ago, it claims that the government has yet to hand over all its property to it.
“The government had decided to handover CAAN´s property just about a month ago as well. Unfortunately, we still have not received land ownership certificates,” said the source.
Aviation fuel dearer
Nepal Oil Corporation (NOC) on Saturday jacked up the price of aviation fuel by Rs 5 per liter for domestic airlines. Price for international carriers too has been raised by US$ 55 per kiloliter.
With the new decision that came into effect instantly, domestic airlines would now need to pay Rs 75 per liter of aviation turbine fuel (ATF).
Likewise, the international carriers, who enjoy bonded supply in accordance with the international norms, would also need to pay US$ 805 per kiloliters of ATF.
“The prices have been increased in line with the international trend,” said a source. Rates for other petroleum products have been remained unchanged, even though the corporation continues to incur losses on them, he told myrepublica.com.
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