Independent body mooted to buy plane

KATHMANDU, Oct 27: The Ministry of Finance, which has been taking a tough stance over pledging a government guarantee for aircraft purchase by Nepal Airlines Corporation (NAC), has now softened its approach and pushed for the formation of an all-powerful independent body to handle procurement of aircraft for the national flag carrier.



The new approach has been mooted after repeated efforts by the national flag carrier to add aircraft to its fleet of just two Boeing 757s have continued to land in controversy.[break]



“We (the government) have converged on the new approach and the Council of Ministers has already instructed the Ministry of Tourism and Civil Aviation (MoTCA) to submit a proposal in this direction,” said Finance Minister Surendra Pandey.



Pandey told Republica that the government will announce a specific arrangement in this connection through the budget for the current fiscal year.



Under the new mechanism, the government will form an independent body that will include faces with credibility and experts in the field, empower it to identify aircraft and suppliers and negotiate the final purchase deal.



“Political figures and discredited personalities will be categorically excluded from the body,” said a source. The motive behind the understanding is to assure that the process remains free of political interests and does not plunge into controversy yet again.



Kishore Thapa, secretary at MoCTA, said that the ministry is holding discussions on the various options for developing a proposal in this connection.



Of the various options, sources said the first approach being discussed is to let the body initiate and steer the procurement process until NAC actually gets the aircraft, with the NAC board facilitating the process.



“The second option is to entrust the body to finalize the deal and turn over the remaining part of the process to the NAC board for completion,” said the source.



Under either process, the NAC board will have a crucial role to play, as it is the only authority under existing law to seal a procurement deal. The government hopes the all-powerful body will conduct the overall process transparently and anticipates that the NAC board will play its duly authorized role positively.



“There is no argument that NAC is in dire need of aircraft. But given the controversy the procurement process has been generating, we believe this mechanism will be the best way to handle the situation,” stated Pandey.



Owing to diverse interests and the lack of transparent dealings, Nepal´s efforts to bring in aircraft for NAC have always ended in controversy.



In its latest efforts, NAC last year decided to buy a wide-body Airbus A330-200 and a narrow-body A320-200 and even forwarded the lock-up money of $750,000 to the aircraft manufacturer.



However, investigations by the Public Accounts Committee of Parliament and the Ministry of Finance found that the deal flouted existing procurement laws and instructions were issued earlier this year to scrap the deal.

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