Zürich Airport shortlisted to develop Nijgadh Airport

The project to be developed under PPP modality

Kathmandu, September 23

The government has shortlisted Zürich Airport International AG to construct the Nijgadh International Airport (NIA).

A meeting of Investment Board Nepal (IBN) led by Prime Minister KP Sharma Oli today shortlisted the Swiss company to develop NIA and decided to seek extensive proposal from Zürich Airport to construct the second international airport in Bara district.

Of the seven domestic and international firms, Zürich Airport International was the only firm that had submitted expression of interest (EoI) for the airport project based on criteria and standards set by the government. As a result, the government had invalidated EoIs of other six firms for the mega airport project.

The other firms to submit the construction proposal of the project included Matrix Enterprises of Nepal, China Airport Construction Group and China State Construction Engineering Company from China, GMR of India, Qatar Airways and Vinci Group of France.

Similarly, IBN board meeting has also decided to develop the NIA project as per public-private partnership (PPP) modality. Construction modality of the project had remained a major conflict between the government, political parties and the private sector.

While calling for EoI for the development of the project, the government had sought proposals from interested firms to build the airport project either under the build, own, operate and transfer (BOOT) or PPP modality.

The IBN decision to shortlist Zürich Airport for the development of NIA has come at a time when Tourism Minister Yogesh Bhattarai has expressed his commitment to realise the project at any cost. Following his appointment to the top post at the Ministry of Culture, Tourism and Civil Aviation on August 1, Bhattarai had announced that the foundation stone of NIA would be laid within a year.

The estimated cost of the project stands at Rs 340 billion ($3 billion). As per the board, the airport will be built in three phases — the first phase will cost $1.21 billion, the second phase $1.12 billion, and the third phase $1.12 billion. The Nijgadh International Airport is expected to be the major aerial gateway of the country after Kathmandu, Pokhara and Bhairahawa airports.

Meanwhile, the 40th IBN board meeting has also shortlisted China Communication Construction Co to construct the Kathmandu Outer Ring Road Project.

As per the initial study report in 2008, the cost of construction of the project was expected to hover around Rs 70 billion. However, since the price of land has skyrocketed in the intervening years, the project construction cost is expected to stand at around Rs 125 billion.

Likewise, the IBN board meeting has also shortlisted Satluj Jal Vidyut Nigam (SJVN) of India, HIDCL (Nepal), Power Construction Corporation of China and Green Resources Ltd (Nepal) to develop the 679-megawatt Lower Arun Hydropower Project.