A member of the parliamentary International Relations and Tourism Committee has revealed that there is an “invisible” hand preventing the passage of two crucial civil aviation bills.
“A former tourism minister has informed our committee that he tried to table the civil aviation bills in Parliament, but did not succeed,” lawmaker Udaya Shumsher Rana told an interaction on Tuesday.
“The minister informed us that there is an invisible hand stopping the bills.”
The two long-pending aviation bills—the Civil Aviation Authority of Nepal Bill, and the Air Service Authority of Nepal Bill—envisage splitting up Nepal’s aviation body into two entities—service provider and regulator, a condition for Nepal to be struck off the European Union’s air safety list.
“We have heard that the prime minister himself has barred the bills from being tabled in the Cabinet before it is tabled in Parliament,” said Rana. “Many experts have advised us that Nepal urgently needs to have a separate civil aviation regulatory body.”
On December 28 last year, the committee directed the prime minister’s office to table the bills in Parliament at the earliest and also ordered the Tourism Ministry to regularly provide updates on the bill’s status. But there has been no progress.
The private sector has charged that the government has deliberately ignored the civil aviation bills even though they have passed the upper house. Passage of the bills is a must for rigorous safety measures to prevent air accidents and incidents.
“The air safety issue is preventing European tourists from visiting Nepal,” said Rajesh Kumar Agrawal, president of the Confederation of Nepalese Industries (CNI), speaking at an interaction titled ‘Unleashing the Tourism Potential: Healing the Past, Shaping the Future’, in Kathmandu on Tuesday.
“We request the government to do the needful to lift Nepal from the air safety list of the European Commission.” “For this, the government should immediately split the Civil Aviation Authority of Nepal into a service provider and regulator.”
Private investment, imperative for tourism sector revitalisation, languishes amid the government’s hesitancy to enact laws and policies, according to them.
Tourism entrepreneurs have invested billions of rupees in the country. The government too has invested heavily in infrastructure development. “It’s time to be serious about drawing tourists,” said Agrawal.
Tourism entrepreneurs say Nepal can double tourist numbers in a short period if effective laws are in place and priorities are accorded.
The first thing is to strengthen the national flag carrier—Nepal Airlines—the key means for transporting tourists.
Agrawal said that there are issues regarding the non-operation of the two new international airports in Pokhara and Bhairahawa.
Dipendra Purush Dhakal, former tourism secretary, said under his leadership in 1999, the country’s Department of Civil Aviation was converted to the Civil Aviation Authority of Nepal.
“That was the demand of time then. Now, the time demands the separation of the Civil Aviation Authority of Nepal into two roles,” he said. “This is a crucial agenda for the tourism industry to prosper. The government, however, seems least bothered.”
Global aviation watchdogs, including the International Civil Aviation Organisation, have been saying that an independent civil aviation regulator is imperative for a country like Nepal where crashes are frequent.
According to Dhakal, apart from the civil aviation body issue, Nepal’s two expensive airports are not operational even months after they were inaugurated.
“The airfare to Nepal is expensive. Until and unless we strengthen our national flag carrier, Nepal will become expensive [for tourists].”
He said that air pollution is another threat. “We need a strategy to tackle air pollution.”
Deepak Raj Joshi, former CEO of the Nepal Tourism Board, said air and road safety issues are glaring in Nepal and it has deterred high-end travellers.
“We cannot hide the fact. But Nepal remaining on the European Commission’s air safety list for a long time is a big concern,” he said. “The budget of the current fiscal year has announced splitting up the civil aviation body into two separate entities, but that remains on paper only.”
In the last two decades, Nepal has seen various upheavals—from a plane hijack to a royal massacre, from political insurgency to political instability and from earthquake to the Covid pandemic, and has suffered a lot.
“Now, we are experiencing a recession followed by an economic slowdown. Problems galore,” said Joshi. “In this situation, if we can’t heal, it will be a big problem.”
Yogendra Shakya, a senior tourism entrepreneur, said in its heyday Nepal Airlines used to bring in 60 percent of tourists and that number contributed to 12 percent to the country’s GDP. “Now, Nepal Airlines’ share in terms of tourist carriage has dwindled to 6 percent.”
According to him, if a tourist spends $1,000 on his Nepal trip, $600 of that sum is swallowed up by airfare. “The figure indicates how crucial is the transport sector for the country’s GDP.”
Shakya said that the government has several reports on bringing reforms to Nepal Airlines.
“In 2002, a high-level committee led by former chief secretary Damodar Prasad Gautam submitted a report suggesting fixes for Nepal Airlines. I too was a member of the committee, and we concluded that Nepal Airlines is a dead horse because it is a political playground.”
“At that time, we suggested getting rid of the dead horse.”
The report had recommended leaving the Nepal Airlines alone as it could stir up the hornet’s nest and proposed setting up an alternative company.
According to Shakya, the committee had recommended setting up a new airline company, allocating a majority 51 percent stake to the government, 35 percent to the foreign strategic partners or private investors and the remaining to the public.
“You will have a brand new company. The existing company could be operated separately as a domestic carrier. The country’s GDP will grow,” said Shakya.
He said that the government on different occasions infused a positive sense in private investors and accordingly the private sector poured money into hotels and luxury resorts.
“Now, even if one million tourists visited Nepal annually that will not be enough to support the growing number of hotels and resorts. If the tourism industry collapses, it is not the private sector that will lose. banks will go bankrupt. The government should take this seriously,” said Shakya.
“That day is eventually coming. Be serious.”
According to the Tourism Department, the country now has 18 five-star properties. And nearly a dozen five-star properties are in the pipeline.
According to Joshi, former chief of the Nepal Tourism Board, Nepal can bring 3.5 million tourists within a year and a half if the existing bottlenecks are addressed.
“This will pump Rs350 billion into the economy and contribute 8-9 percent to the GDP.”
Binayak Shah, president of Hotel Association Nepal, said, “We are at the crossroads. We can accommodate 3.5 million tourists but are receiving only a million.”
“On average, the hotels have 25 percent occupancy, and are incurring losses, although big hotels have up to 90 percent occupancy.”
