Nepal | January 22, 2019

PAC forms sub-committee to probe NAC wide-body aircraft purchase

Sujan Dhungana

Kathmandu, December 12

The Public Accounts Committee of the Parliament has formed a sub-committee to probe possible anomalies in Nepal Airlines’ wide-body aircraft procurement process.

The committee’s decision to form the probe panel is backed by the report of the Public Procurement Monitoring Office, which states that Nepal Airlines Corporation did not ‘properly follow’ the Public Procurement Act while purchasing the two wide-body planes.

The seven-member probe panel has lawmaker Rajendra KC as the coordinator. “The sub-committee will look into every aspect of the wide-body aircraft procurement deal and submit its report to the full committee within 15 days,” PAC Chairman Bharat Kumar Shah told THT, adding that PAC will take necessary decisions based on the findings of the report.

As the PPMO and the Office of the Auditor General have already mentioned that NAC has exploited loopholes in the Public Procurement Act and the corporation’s bylaws while acquiring the wide-body aircraft, PAC has mandated the sub-committee to investigate the issue and prepare the report on the basis of the findings of PPMO and OAG.

The annual audit report of OAG has revealed irregularities amounting to a staggering Rs 6 billion in the wide-body aircraft purchase deal. Addressing the PAC meeting, Auditor General Tankamani Sharma said NAC had used an agent to purchase the planes instead of seeking bids from aircraft manufacturing companies as envisioned in the law.

The PPMO recently outlined a number of faults in the concerned aircraft purchase deal. Among other faults, the PPMO’s report mentions that NAC purchased the aircraft without conforming to the provisions of the Public Procurement Act. Its report states that NAC did not mention the ‘terms and conditions’ of the purchase agreement in the bidding notice and also failed to mention the parameters to analyse the bid documents as sought by the law.

PAC had earlier summoned Minister of Culture, Tourism and Civil Aviation Rabindra Adhikari, Tourism Secretary Krishna Prasad Devkota, Executive Chairman of NAC Madan Kharel and NAC’s Managing Director Sugat Ratna Kansakar to discuss the issue.

A sub-panel of the Parliamentary International Relations Committee has already started probing the controversial procurement, ownership and operation of two wide-body aircraft purchased by NAC.

The first wide-body Airbus A330-200 aircraft was added to NAC’s fleet on June 28, while the corporation acquired the second long-haul aircraft on July 26. However, these long-haul aircraft have become ‘white elephants’ for NAC due to the corporation’s failure to operate them in a full-fledged manner.

 

 


A version of this article appears in print on December 13, 2018 of The Himalayan Times.


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