Money

Court summons ministry in case against plane purchase

  • Chinese aircraft for NAC
- Post Report, KATHMANDU

Apr 3, 2014-

The Supreme Court on Wednesday asked the defendants, including the Tourism Ministry, to explain about the purchase of Chinese-made planes, in a case filed against the government’s decision to procure the aircraft.

A single bench of Justice Gyanendra Bahadur Karki asked both the petitioner and the defendants to be present on April 7 to discuss whether a stay is required as demanded. Filing a writ on March 27, petitioner Krishna Prasad Dahal of Okhaldhunga had argued the government failed to comply with legal procedures mentioned in the Public Procurement Act.

Based on media reports, the petitioner had said four of the six aircraft have been purchased without following the global tendering process and that it left a spacious room to doubt that the cost of the aircraft is high and would result in a heavy financial burden on the government. 

The Office of the Prime Minister, Ministry of Culture, Tourism and Civil Aviation, Nepal Airlines Corporation (NAC) and the NAC board have been named defendants. 

As per the agreement between Nepali and Chinese governments, the northern neighbor will provide a grant of RMB 180 million (Rs 2.98 billion) for procuring Y-12e and Modern Ark 60  (MA60) aircraft, while China EXIM Bank will provide soft loans worth RMB 218 million (Rs 3.61 billion) to purchase the four aircraft (three Y-12e and an MA60). On November 29, 2012, NAC had signed a commercial agreement with AVIC International Holdings, a Chinese government undertaking, to procure the six aircraft. 

On August 7, 2011, NAC had written to the Finance Ministry, requesting it to purchase eight aircraft under foreign grants. In November 2011, the ministry requested China to provide aircraft either in grant or under soft loans. The Chinese side responded positively, expressing their readiness to provide some aircraft in grant and some under soft loans.

Subsequently in December 2011, the Chinese government formally informed the Finance Ministry that three aircraft would be provided to the NAC in grant and the others under soft loans. As per the revised deadline, China is scheduled to deliver the first batch of two Modern Ark 60 aircraft on April 26, revised from earlier March 15.

Published: 03-04-2014 08:50

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