Chinese bank officials to visit on March 9

KATHMANDU:

The government is preparing to sign a loan agreement with China Exim Bank to build the Pokhara Regional International Airport. In preparation for the same, a team of officials from the Chinese bank is visiting Nepal next week for pre-agreement discussions.

During the team’s visit, the government will hold discussions regarding different aspects of the project, including interest rate of the credit line. In October last year, the government had formally decided to construct the airport, ending a long-standing controversy over the cost of the project initiated in 2011.

“The bank’s officials are scheduled to arrive in Nepal on March 9 for field visit to Pokhara and discuss on the agreement,” said Madhu Marasini, joint secretary at the Ministry of Finance (MoF). He said that they were hopeful of signing the loan agreement

in the next phase after this visit of the officials from the Chinese bank.

MoF has already applied for a loan of $215.96 million to build the airport. The government had signed an agreement with CAMC Engineering Co of China in May to construct the airport. Despite huge demand for the project, it has not been able to make any headway because of controversy over the estimated cost of the project.

Initially, the Chinese firm had emerged as the lowest bidder for the project quoting $306 million and Civil Aviation Authority of Nepal (CAAN) had also decided to award the project to it. However, following the controversy on the project cost, CAMC based on conclusion of an independent study had agreed to undertake the project at a cost of $215.96 million and signed the agreement accordingly.

The airport will be constructed on 3,106 ropanis of land at Chinnedanda of Pokhara, which is 3km east of the existing airport at Pokhara.

Once the loan agreement is signed between MoF and the bank, CAMC will first have to prepare a detailed design of the airport, which is expected to take around one year, according to the Ministry of Culture, Tourism and Civil Aviation.

It is expected that the project, which is being undertaken under the engineering, procurement and construction model, will be completed within three years after preparation of the detailed design.

In the first six months of the current fiscal year, the government started preparations to acquire 550 ropanis of land and has already spent Rs 268 million in the process. The project has been allocated Rs 2.7 billion in the current fiscal year for land acquisition and other preparatory works.

Source: THT