NAC to send final instalment of $68m for new Airbus plane
Kathmandu, June 17
Nepal Airlines Corporation (NAC) is preparing to send the remaining money to pay for its first new Airbus 330-200 wide-body airplane, which is scheduled to land in Kathmandu on June 27. The national flag carrier is preparing to send around $68.20 million (approximately Rs 6.81 billion) to the escrow account held by Norton Rose Fulbright in Europe.
Earlier in June, NAC had forwarded a proposal to its line ministry, the Ministry of Culture, Tourism and Civil Aviation (MoCTCA), seeking its consent for foreign exchange facility to make the payment. After studying and approving the proposal, MoCTCA has forwarded a letter to Nepal Rastra Bank today requesting it to provide the foreign exchange facility to NAC, according to Ghanashyam Upadhyaya, spokesperson for MoCTCA.
NAC has already sent $39.50 million (Rs 3.95 billion) as pre-delivery fee and $500,000 (Rs 50 million) as commitment fee for each Airbus 330-200 wide-body aircraft in one of the largest ever aircraft purchase deals in Nepal's aviation history in June last year. NAC will be purchasing two aircraft of the same make. At the time, NAC had paid pre-delivery and commitment fees for two long-range Airbus 330-200 series planes to AAR Corporation.
The national flag carrier had signed an agreement with AAR Corporation to buy two Airbus 330-200 series wide-body aircraft worth $209.6 million. AAR Corporation will be providing the aircraft to NAC in partnership with German Capital and Hi-Fly Airlines. NAC plans to pay remaining money for the second aircraft by end of July.
“We have already paid the commitment and pre-delivery fees to AAR Corp and now the process to make the full payment has begun,” said Sugat Ratna Kansakar, managing director of NAC.
According to the agreement signed between NAC and AAR Corporation, NAC has to pay the final instalment two days before the aircraft are delivered.
The first of the two planes is scheduled to arrive in Kathmandu on June 27, whereas the second wide-body aircraft is expected to be delivered a month after the arrival of the first one or in July this year.
To buy the new A330-200 wide-body airplanes, NAC has borrowed Rs 12 billion each from Employees Provident Fund (EPF) and Citizen Investment Trust (CIT). The interest rate of EPF and CIT has been fixed at nine per cent per annum, and the repayment period has been set at 15 years.
NAC has said it will start its first commercial flight with the new Airbus A330-200 aircraft to Dubai on August 1. This is the first time since its establishment NAC will be operating two 274-seater wide-body planes. Currently, NAC is conducting international flights through two narrow-body Airbus aircraft and one Boeing 757.
