Cabinet sets Pokhara international airport plan rolling

KATHMANDU, FEB 16 -

The government has given a green signal to the development of the much-controversial regional international airport in Chinnedanda, Pokhara. The airport is planned 3km east of the existing airport.

A Cabinet meeting on Friday decided to go ahead with the bidding process that was put on hold since July last year, after the China CAMC Engineering Co—the lowest bidder—quoted 85 percent higher than the government estimated price for the project.

Senior officials at the Tourism Ministry said they had forwarded a proposal to the government, seeking permission to continue with the process after the bidder showed willingness to develop the project at the government-estimated cost.

Among the three shortlisted Chinese firms, the CAMC had quoted $305.13 million, while the government had estimated the project to cost between $166 and $170 million.

“The Tourism Ministry had asked the government to allow continuing the process after the bidder showed willingness to take up the plan as per the government estimation,” said Ranjan Krishna Aryal, joint-secretary at the ministry.

In the first week of January, China CAMC had dispatched a letter to the Civil Aviation Authority of Nepal (CAAN) showing willingness to develop the project as per the CAAN’s bill of quantities (BOQ).

The BOQ is a document used in the bidding process that details project costs and the terms and conditions of the construction to enable the contractor to develop the project as per the executing agency’s estimated price. CAAN is the executing agency of the project. However, a Cabinet minister said the agenda was flatly approved by Prime Minister Baburam Bhattarai.

As per the rules, a project bid stays valid up to 120 days after the final evaluation of the qualified bidders. As CAAN or government officials have to bypass the law to get the project going, the agenda was taken to the Cabinet.

On February 9, 2012, CAAN had invited bids to build the airport under the Engineering Procurement and Construction model. However, it was forced to extend the deadline twice due to intervention by the Commission for Investigation of Abuse of Authority.

On July 18, 2012, CAAN’s tender evaluation committee had opened financial proposals for the project.

Subsequently, the project was dragged into controversy with CAAN’s unions opposing the deal, arguing that it was not economically viable under the authority’s existing financial status.

On the other hand, people of Pokhara have been demanding that the project that has remained idle since 1975 be executed this time around. They have organised a series of protests against the government’s failure to construct the airport. The government plans to borrow around $145 million in soft loans from the Export-Import Bank of China (Exim Bank) to fund the project.

A detailed study of the airport project in 1989, conducted by the government in association with the Japan International Cooperation Agency, had proposed a 2,500m long and 50m wide runway, a terminal and a cargo building. The construction of the airport, expected to be completed in four years, was estimated to cost $ 39.6 million then.

Source: The Kathamndu Post