The proposed Integrated Civil Aviation Bill 2016 has envisaged allowing the private sector to build and operate airports.

A draft of the new law looks kindly on potential privately operated airports, and it has also simplified the process for the government to privatize its existing airports.

The proposed bill, which has been put on the websites of the Tourism Ministry and the Civil Aviation Authority of Nepal (Caan) to get feedback from stakeholders, says that the private sector can develop and operate airports after receiving the government’s okay.

According to the draft, the government has laid down five criteria for the construction of private airports.

The proposed airport must be feasible in terms of geographical, environmental and commercial factors. It should be viable in terms of the population size that will use the facility, local and foreign direct investment and social obligation. The government, however, will determine the airport’s limits.

“The existing Civil Aviation Policy 2006 contains a provision allowing the private sector to enter the airport business, but it has not happened because there are no laws related to it,” said Rajan Pokhrel, deputy director general of Caan. “Sourcing capital for such investments from the private sector is essential in airport infrastructure development,” he said. “Once the law permits private sector investment in airports, it will also attract foreign direct investment.” He added that many countries had started privatizing airports, and Nepal should not stay aloof.

Currently, there are 50 domestic airports in Nepal, 32 of which are in operation. Caan makes an operating profit from only seven of them. According to Caan officials, inviting the private sector into the airport business will also improve the quality of service. The government has accorded priority to the development and upgradation of airport infrastructure in a bid to revitalise the tourism industry that has been struggling to attract even a million tourists annually in its six-decade history.

The government is currently constructing three new international airports. The $215.96 million Pokhara International Airport project is expected to be completed by July 2020. Gautam Buddha International Airport, which will serve as a gateway to the birthplace of Buddha in Lumbini, is scheduled to be completed by mid-2018.

Apart from the development of two international airports, the government is also considering building a full-fledged international airport in Nijgadh, Bara which will cost Rs121 billion.

Meanwhile, Tourism Ministry officials said that they plan to hold a number of interactions on the proposed bill. The draft will then be sent to the Law Ministry before being submitted to the Cabinet. After necessary reviews by a Cabinet

committee, the bill will be tabled in Parliament. It will supersede two existing laws—Civil Aviation Act 1959 and Nepal Civil Aviation Authority Act 1996.