Is it Possible to Pay the Debts of PRIA? Fear Increasing

No international airlines have flown so far to Pokhara Regional International Airport, which was inaugurated on January 1. Prime Minister Pushpa Kamal Dahal ‘Prachanda’ had inaugurated the Pokhara Airport amidst a grand ceremony.

Only domestic airlines have been flying at this airport, which was built with Chinese loan investment. The perception on the airport has worsened more after the Yeti Airlines crashed on January 15 in Pokhara shortly before landing at the airport.

Why has this airport, which was built by the government as a project of pride, not been able to operate effectively? The reason is lack of preparation. Culture, Tourism and Civil Aviation Minister, Sudan Kirati has recently accepted this fact.

The preparations and initiatives for flights have just started. In a press conference held at Pokhara Airport a few days ago, Minister Kirati said that diplomatic efforts are being made to make a flight from Pokhara International Airport to neighboring countries.

According to Minister Kirati, the ministry is discussing direct flights to other cities in India, including various cities in China that have sister relations with Pokhara. The Ministry recently instructed the Civil Aviation Authority to come up with an action plan on how to operate Pokhara Airport. While these are the works that should be done before construction. Pokhara’s tourism professionals have been demanding to start international flights as soon as possible.

Another problem of Pokhara International Airport is birds and wild animals. Even though this problem was mentioned before the construction started, it was ignored. In the eastern part of the airport, there is the Vijaypur river and the Seti river in the south. Just after crossing the Vijaypur river, the runway arrives. But when these two rivers are dirty, dead animals are thrown away and birds are attracted to food, which is a big challenge for the airport.

Airport staff say that this will cause problems in flights and landings. A few days ago, a bird collided with a plane that was landing. There are a lot of foxes in the bushes near the airport. There used to be a problem when foxes entered the airport at night.

The Pokhara International Airport was built with a loan assistance of Rs 22 billion from the Exim Bank of China. The Government of Nepal had signed a loan agreement of 1.37 billion Chinese Yuan with China’s Exim Bank seven years ago. However, the government has been exempted from paying interest on 25 per cent of the loan. It means that the government does not have to pay interest on 344.46 million Yuan while it has to pay 2 per cent interest on the remaining amount. This loan has a grace period of 7 years and is to be repaid in a total of 20 years.

The grace period is ending soon. According to the Civil Aviation Authority of Nepal (CAAAN), it has to pay the first installment of 53.28 million Yuan in March. The second installment should be paid after six months. The authority should repay the loan of Exim Bank twice a year.

As the airport is built in a tourist hub like Pokhara, there is a high possibility that the government can get enough benefits from it. However, solving all the problems seen now will be a big challenge.

Former CEO of the National Reconstruction Authority Dr. Govinda Raj Pokharel says that there is a dark cloud over the possibility of international/domestic flights at Pokhara Airport. He says that it will be difficult for the airport as the trade deficit and public debt are constantly increasing.

Due to the current situation, doubts are also growing if the government will be able to repay the loan from Pokhara Airport’s income. Therefore, the analysts say that emphasis should be placed on more flights and cargo transportation. Due to the geography and location of the airport, only 150-seat Airbus 319, Airbus 320 and Boeing 575 aircraft can land here. That’s why there are various suspicions about the airport.

On December 31, just a day before the inauguration of the Pokhara International Airport (PIA), the Chinese Embassy in Nepal claimed the PIA to be a flagship project of China’s Belt and Road Initiative (BRI).