Kathmandu, June 10

The Export-Import (Exim) Bank of China has made around Rs 22 billion loan committed for the Pokhara airport effective after Nepal has met the set conditions for loan disbursement.

“Loan effectiveness has paved the way to disburse loan amount,” said Yugraj Pandey, undersecretary of the International Economic Cooperation Coordination Division, under the Ministry of Finance (MoF). “Now the project developer will be able to acquire 15 per cent of total project cost in advance.”

The government signed a $215.96 million soft loan agreement with China in March last year for construction of the regional international airport in Pokhara. China Exim Bank had agreed to provide 25 per cent of the loan interest-free and had set interest rate of two per cent per annum for rest of the amount, with payback period of 20 years.

After the loan agreement was signed during the then prime minister KP Sharma Oli’s visit to China last year, the China Exim Bank had asked for the procedural design of the airport and other related documents to make the loan effective.

China CAMC Engineering Company, a Chinese construction firm, has already started construction works of Pokhara Regional International Airport. The firm was awarded the construction contract of Pokhara airport in May 2014.