SANGAM

Right this way, please

2015-01-26T00:51:00.004-08:00

SANGAM PRASAIN
KATHMANDU, JAN 26
Nepal can look forward to a further boost in tourist arrivals from India following the Indian government’s decision to provide “leave travel concession” to government employees to visit Nepal and other Saarc countries.

Nepal’s tourism industry is naturally agog with anticipation as there are around 2 million government employees down south, and that’s a lot of potential tourists. India is already the largest source market for the country.

Last year, it sent 180,974 air travellers to the Himalayan republic.

According to the Tourism Ministry, the share of Indian visitors in Nepal’s tourism stands at 23 percent. Unfortunately, they are not known for staying long or spending much in Nepal, pointing to an area the tourism industry needs to work on.

In 2013, Indian tourists spent 8.67 days on average in Nepal, putting them among the shortest stayers in Nepal. Of the total Indian arrivals, 142,054 were first time visitors. More than 528,321 Indian tourists enter Nepal through eight border points annually.

For the last few years, Nepal has been seeing a gradual decline in Indian arrivals due to the closure of the casinos and lack of tour packages appealing to them. However, industry watchers say things are getting better now.

Part of the optimism stems from the statement made by Indian Prime Minister Narendra Modi during his visit to Nepal for the 18th Saarc Summit last November emphasizing the need to enhance connectivity between the two countries to boost tourism.

In fact, Modi’s declarations and substantial changes in India’s policy towards Nepal could mean a lot for Nepal’s tourism. “The Indian government has started to sort out potential bottlenecks that have been hindering trade and tourism growth between the two countries,” said Aditya Baral, spokesperson of the Nepal Tourism Board. “Most importantly, the Modi government has implemented almost all the commitments it made to Nepal and this, in fact, has strengthened people-to-people and government-to-government relations.”

In a key policy change, India has declared that individuals from India can carry Rs 1,000 and Rs 500 Indian currency (IC) notes totalling up to IRs 25,000 to Nepal.

The currency restriction, which forced travellers to carry large wads of Rs 100 notes, was one of the longstanding issues for Indians visiting Nepal. The Indian central bank had banned the use of large denomination notes in Nepal citing security concerns.

Similarly, the Indian government has agreed to review the airspace agreement to provide more entry routes for airlines coming to Nepal. The airspace agenda, which had been gathering dust for a long time, was endorsed during Modi’s recent visit to Nepal.

The government has requested India to open three more air entry points at Janakpur, Bhairahawa and Nepalgunj to allow Nepali carriers to link major Indian cities in the near future.

The additional cross-border direct routes are expected to facilitate flights between regional airports in Pokhara and Bhairahawa, and this will save time and money for air travellers and also improve air connectivity between India and Nepal. Modi had also flagged off a bus service between Kathmandu and New Delhi.

Nepal and India have also signed a landmark agreement on tourism to mutually promote the Buddhist pilgrimage circuit. The Buddhist pilgrim route connects Bodhgaya in Bihar and Sarnath and Kushinagar in Uttar Pradesh in India and Lumbini in Nepal.

Likewise, the two governments have agreed to strengthen cultural ties by establishing sister city relations between Kathmandu and Varanasi and Janakpur and Ayodhya. While Kathmandu is the city of Pashupatinath and is also called the city of big and small temples, Varanasi is home to Kashi Vishwanath, one of the most revered Hindu temples, and numerous other temples and ghats.

Likewise, while Ayodhya in India is the birthplace of Lord Ram as per Hindu mythology, Janakpur in Nepal is believed to be the home of his consort Sita. “With all these initiatives, one can expect a spike in terms of tourist arrivals from India in the near future,” added Baral.

Indian carriers account for the largest share of inbound tourism in Nepal. According to Tribhuvan International Airport (TIA), they fly in almost 40 percent of all the tourists visiting Nepal.

Currently, four Indian carriers -- Jet Airways, Air India, Spice Jet and IndiGo -- serve Nepal and hold around 30 percent of the market share.

As Nepal has not been able to fully cash in on the Indian market for a long time despite the proximity and similar religions and cultures, Modi’s visit to Nepal has given an optimistic outlook for the country’s tourism, said Binayak Shah, vice-president of Hotel Association Nepal.

The leave travel concession announced by the Indian government for its employees should boost arrivals from the southern neighbour. “Even nominal numbers from India will mean a lot to Nepal.”

However, there are some things Nepal needs to do too. According to Shah, the country needs to develop tour packages more effectively as limited offerings had forced Indian visitors to turn elsewhere, particularly Thailand. “The closure of the casinos affected Indian arrivals the most.”

Meanwhile, most of the bordering towns in Nepal have started realizing the potential of Indian visitors. A number of tourist standards hotels are being constructed in the bordering areas to cater to Indian visitors.

The announcement of India’s leading luxury hotel chain -- The Leela Palaces, Hotels and Resorts -- to enter Nepal is also a happy sign for Nepal’s hospitality industry.

Nepal’s Summit Group of Hotels and Resorts and Leela have signed a memorandum of understanding to establish four hotels across the country, including a five-star deluxe hotel in Kathmandu.

Other properties planned to be built in Nepal under the Leela banner will be located in Pokhara and two pilgrimage hubs, Lumbini and Janakpur. The plan to develop a hotel in Lumbini, the birthplace of Gautam Buddha, is part of Leela’s initiative to establish a Buddhist trail from Nepal to Bodhgaya, Nalanda and Varanasi in India.

Meanwhile, the Indian government’s plan to issue visa on arrival to travellers from nearly 180 countries has also been seen as a big development for Nepal as it is expected to increase tourist inflow into the country.

Experts said that there were greater chances of tourists visiting India making a side trip to Nepal if the proposed visa liberalization scheme was implemented by the Indian government.

Politicians push dozen new airport plans

2015-01-04T22:24:00.002-08:00

SANGAM PRASAIN
KATHMANDU, JAN 04 - At a time when the condition of many domestic airports is deteriorating in the lack of maintenance, around a dozen smaller airports are being constructed under “political pressure”.

According to the Civil Aviation Authority of Nepal (Caan), construction of 10 new airports has been initiated at the behest of political party leaders. Kalikot Airport, Khiji Chandeshori Airport in Okhaldhunga, Sitleshwora Airport in Lamjung, Simichaur Airport in Gulmi, Sukilumba Airport in Ilam, and Argha Bhagwati Airport in Argakhanchi are in the phase of development.

The Tourism Ministry recently approved the plan for Sagarmatha Airport in Udaypur while Caan has started feasibility study for airstrips in Chalnetaar of Pyuthan, Rampur of Palpa and Gudel of Solukhumbu.

Caan sources said the Sagarmatha Airport plan was passed with pressure from Urban Development Minister Narayan Khadka. Likewise, Home Minister and Deputy Prime Minister Bam Dev Gautam has been pressing for the facility in Chalnetaar, Pyuthan.

Feasibility study of the airport in Rampur, Palpa was undertaken during the tenure of Interim Election Government Chairman Khil Raj Regmi, who hails from the district.

Caan has allocated Rs 100 million this fiscal year for the feasibility study. A senior civil aviation official said the projects would not be commercially viable.

In a small geography like Nepal that has a disproportionately small number of aircraft for domestic operation considering the “large” number of airports, more airfields are not feasible both financially and technically, experts say. The aircraft to airport ratio in Nepal is 1:1. There are 52 fixed-wing aircraft and 26 helicopters in operation.

Among the 50 domestic airports, 32 are in operation while Caan makes operating profit from only seven.

Government officials say haphazard construction of airports is not new in Nepal. A report prepared by Spanish company INECO that was hired to study capacity development of Caan suggested setting strict criteria for building new facilities.

American intelligence agency CIA ranks Nepal 94th among the countries having the most number of airfields recognisable from air. In South Asia, India tops the chart with 346 airports—21st globally. Pakistan has 151 airports, Afghanistan 52, Sri Lanka 19, Bangladesh 18, Maldives has 9 while there are only two airports in Bhutan.

Domestic air pax number down

2015-01-02T01:47:00.003-08:00

SANGAM PRASAIN
KATHMANDU, JAN 02 - The number of domestic air passengers declined in the first nine months of 2014 due to various factors such as extended road network that has cut the travel time to many remote destinations.

According to Tribhuvan International Airport (TIA) statistics, domestic passenger

movement dropped 6.24 percent to 1.032 million, meaning airlines received 32,455 fewer passengers in the review period.

Air passenger movement has been on a constant decline since 2012, marking a departure from the robust growth rates since 2008 when airlines were

flying high due to competitive airfares, road blockades, and increased NGO/INGO staff movement after the peace process, and a real estate boom.

Meanwhile, there were 47,103 flights in the Nepali skies in the review period, down 0.85 percent. The stats show TIA witnessed 175 take-offs and landing on an

average daily.

The domestic airlines received the highest number of passengers in April, with 243 take-offs and landing daily on an average.

“The shortage of aircraft to serve short-take-off-and-landing airfields and extended road network in many remote destinations reduced the number of air travellers,” said Ratish Chandra Lal Suman, director general of the Civil Aviation Authority of Nepal.

Besides, according to Suman, after the peace process, surface travel has become the choice of the travellers.

However, industry insiders blame skyrocketing airfares for the airlines receiving fewer travellers. The European Commission, which has blacklisted Nepali carriers

for being unsafe, has further deterred travellers from using domestic airlines , they say.

In the last two years, airfares have gone up by Rs 2,000-2,500 on long-haul routes and Rs 700-1,000 on short-haul sectors.

Some airlines officials blamed reduced tourist movement from India for the decline in air passenger flow.

Roshan Regmi, marketing manager of Yeti Airlines, said hikes in fuel surcharge in line with increased aviation fuel price in the past years increased the airfare, adversely affecting passenger occupancy.

“Besides, domestic carriers did not receive tourists as expected this year,” he said.

Buddha Air, Yeti Airlines, Tara Air and Sita Air recorded negative growth in terms of passenger occupancy during the first nine months of 2014. Buddha Air flew 589,271 travellers in the review period, down 9.72 percent. The airline commanded 57 percent market share.

Buddha’s nearest competitor Yeti Airlines saw its passenger movement drop 8.51 percent to 292,437. Yeti’s subsidiary Tara Air saw its passenger numbers drop 4.23 percent to 49,390, while Sita Air witnessed its passenger traffic drop 4.22 percent to 4,222.

In the fixed wings category, only Simrik Airlines and Nepal Airlines saw the strongest passenger growth. TIA stats show Simrik recorded 37.92 percent growth in passenger occupancy. It flew 59,803 travellers in the first nine months.

The national flag carrier saw its passenger numbers grow 14.47 percent to 19,872 in the review period. NAC has a marginal 1.92 percent share in the domestic market.

PASSENGER MOVEMENT (JAN-SEPT 2014)

2013 2014
Passenger 1101494 1032725 -6.24 percent
Flight 47511 47103 -0.85

PASSENGER MOVEMENT (JAN-SEPT) 2014

Buddha Air 652,716 589,271 -9.72
Yeti Airlines 319,649 292,437 -8.51
Simrik Airlines 43,358 59,803 37.92
Tara Air 49,390 47,296 -4.23
Nepal Airlines 17,360 19,872 14.47
Sita Air 4,411 4,222 -4.28

Transport fares cut as fuel prices ease

2014-12-24T02:10:00.001-08:00

SANGAM PRASAIN
KATHMANDU, DEC 24 - The Airlines Operators Association of Nepal (AOAN) has slashed the fuel surcharge added to the price of a plane ticket in line with a drop in oil prices.

Fuel surcharges have been reduced by Rs 125 to Rs 390 depending on the distance, and the revised airfares will come into effect from Tuesday, the AOAN said Monday.

Similarly, the government has decreased public transport fares and freight charges effective from Wednesday.

Passenger fares have been cut by a nominal 1 percent while cargo rates have been slashed by 2.02 percent for Tarai routes and 2.73 percent for hill routes, said the Department of Transport Management. Taxi fares remain unchanged.

The public transport fares and freight charges have been revised as per the baseline fares fixed on March 8, 2013 when diesel cost Rs 99 per litre,” said Mukti KC, spokesperson of the department.

“The cut is nominal, but it is justifiable when seen in the light of the fact that passenger and cargo fares have not been revised for the last 21 months,” he said.

Earlier, the Ministry of Physical Infrastructure and Transport and the transporters had reached an agreement to raise public transport fares by 5.63 percent with effect from November 1, based on an agreement reached six months ago. But the plan was deferred when oil prices started to fall.

“If the rate demanded by transporters and the 1 percent hike made by the government are calculated, the cuts add up to 6.63 percent,” KC said.

Since September 28 when Nepal Oil Corporation (NOC) adopted an auto pricing mechanism, diesel prices have dropped Rs 13.23 per litre. When asked if the department would revise fares in line with the auto price adjustment of NOC, KC said it was not viable to do so.

Airlines are required to slash the fuel surcharge when fuel prices drop by Rs 4 per litre as per an agreement made between the Civil Aviation Authority of Nepal (Caan) and the AOAN. They are allowed to increase the surcharge when fuel prices rise by Rs 4 or more per litre.

On December 19, NOC slashed the price of aviation fuel sold to domestic airlines by Rs 10 per litre to Rs 133 per litre. The state-owned oil monopoly makes a profit of Rs 41.78 per litre of aviation fuel sold to domestic carriers even after reducing the price.

“After repeated requests, NOC has finally revised aviation fuel prices, and travellers and carriers should feel some relief,” said Ghanashyam Acharya, spokesperson of the AOAN.

On December 5, the AOAN had given a 10-day ultimatum to NOC to enforce the auto-pricing system. Arguing that making hefty profits of more than 50 percent on aviation fuel was against the government’s Black Marketing and Some Other Social Offences and Punishment Act, 1975, the AOAN had warned that it would intensify protests if prices were not revised.

The corporation has been adopting a cross-subsidy mechanism by increasing aviation fuel prices to stabilize prices of other petroleum products.

Revised fuel surcharge

SECTOR NEW FUEL REVISED

SURCHARGE AIRFARE

Kathmandu to

Dhangadhi Rs 5,150 Rs 11,405

Mountain flight Rs 4,985 Rs 10,285

Nepalgunj Rs 3,905 Rs 8,540

Bhadrapur Rs 3,655 Rs 7,890

Biratnagar Rs 3,075 Rs 6,845

Bhairahawa Rs 2,740 Rs 6,000

Pokhara Rs 2,245 Rs 4,645

Janakpur Rs 1,995 Rs 4,100

Bharatpur Rs 1,745 Rs 3,570

Nepal-Lanka air links set to resume by Feb

2014-12-18T23:02:00.002-08:00

SANGAM PRASAIN
KATHMANDU, DEC 19 - Direct air links between Nepal and Sri Lanka are set to resume after a break of two and a half decades with Colombo-based carrier Mihin Lanka planning to begin services by February, Tourism Ministry officials said.

The low-cost airline, which is owned by the Sri Lankan government, has officially applied for operating authorization to conduct daily flights between Kathmandu and Colombo.

“We have received a diplomatic note from the Sri Lankan government seeking operating authorisation and are waiting for the carrier’s complete documents,” said Suresh Acharya, joint secretary at the ministry.

During the 1980s, Nepal Airlines Corporation in its previous avatar used to operate direct flights to Colombo. It was forced to suspend operations following the LTTE armed movement in Sri Lanka. Since then, there have been no direct air links between the two countries.

Nepal and Sri Lanka had been discussing flight connectivity since the end of the LTTE armed movement in Sri Lanka. The two countries signed an Air Service Agreement on January 23, 2009.

“The initiative to operate flights is also part of the leaders’ commitment to link all the Saarc capitals with direct flights,” said Acharya. He added that direct air links would boost Nepal’s tourism as visitors from Sri Lanka are expected to grow in the coming years.

According to Tourism Ministry statistics, 32,736 Sri Lankan tourists visited Nepal in 2013. Of the total arrivals, 30,582 or 94 percent entered Nepal via surface route. Around 98 percent of the Sri Lankan visitors are pilgrims here to visit Lumbini, the birthplace of Gautam Buddha, said travel trade entrepreneurs.

Arrivals from Sri Lanka, which used to be the third largest source market for Nepal after India and China, dropped sharply last year. Arrivals in 2012 amounted to 69,476, up from 59,884 in 2011. Sri Lankans are the lowest stayers in Nepal after Bangladeshi and Thai visitors. A Sri Lanka spends 7.88 days on average in Nepal.

“As Nepal is not directly linked with Colombo, almost all the travellers from Sri Lanka enter the country overland at Bhairahawa.

As they are handled by Indian tour guides, they do not contribute significantly to Nepal’s tourism,” said Acharya, adding that direct links would boost numbers and revenues.

Meanwhile, three new international airlines are poised to serve Kathmandu’s Tribhuvan International Airport (TIA) from January. Malaysia-based Malindo Air, Dhaka-based Regent Airways and Chengdu-based Sichuan Airlines have applied for operation authorization. All the three carriers plan to operate daily flights to TIA from their respective hubs. At present, TIA is served by 26 international airlines.

Paddy output to dip 5pc due to late rains

2014-12-16T23:21:00.002-08:00

SANGAM PRASAIN
KATHMANDU, DEC 17 - Paddy output is expected to drop 5.1 percent to 4.78 million tonnes this fiscal year, the Ministry of Agricultural Development said unveiling a preliminary summer crop production report on Tuesday.

Nepal produced 258,435 tonnes less paddy compared to last year largely due to a late monsoon and untimely rainfall. The ministry said that expanding urban areas, land plotting for residential development and natural disasters were the other reasons behind the fall in output.

More than 61,000 hectares of paddy fields have been left uncultivated. In addition, 23,900 hectares were damaged by floods and landslides this year. Paddy productivity has dropped 1 percent to 3.36 tonnes per hectare.

Based on the market value of Rs 20 per kg, the country produced paddy worth Rs 100 billion this year, Rs 5 billion less than last year, the ministry said.

Similarly, the country’s maize output, which is the second staple crop after paddy, fell 6 percent to 2.14 million tonnes. The figure represented a drop of 137,931 tonnes. The areas under maize cultivation shrank 5 percent to 882,395 hectares. Maize productivity also dropped 1.1 percent to 2.43 tonnes per hectare.

The ministry has estimated the value of this year’s maize output at Rs 50 billion.

“Paddy cultivation this year was severely affected by a late monsoon and untimely rainfall,” said Hem Raj Regmi, chief statistician at the ministry. “As paddy transplantation during the June-September period in most of the eastern Tarai districts was not completed, the impact was reflected in the output.”

Rainfall during the paddy transplantation period (June-September) was below normal at 94 percent. The monsoon was recorded at 76 percent during the key period of June.

However, the ministry has attributed the drop in maize output to crop diversification as most of the farmers had switched to vegetable farming because of the higher and quicker returns.

Climatic fluctuations have a profound influence on Nepal’s agriculture. Paddy production dropped sharply by 11.3 percent to 4.50 million tonnes in 2012-13 when the country suffered a drought with rainfall reaching 83.3 percent during the four key months.

In 2013-14, rainfall was good during the plantation period, and paddy output jumped 12 percent to 5.04 million tonnes. Government officials said that a drop in the output of summer crops would negatively impact not only the country’s food security but also the economic growth target.

Despite a bumper paddy harvest and a surplus food reserve of 800,000 tonnes in the last fiscal, Nepal Rastra Bank’s statistics show that the country imported rice worth Rs 12.37 billion that year, up 46.4 percent from before.

Ministry spokesperson Uday Chandra Thakur said that due to rising disposable incomes stemming from swelling remittance, Nepalis were eating better quality foreign rice leading to a jump in imports. “Rice imports are mainly of ‘masino’ rice and this shows that the people no longer like eating the traditional ‘mota’ rice.”

Meanwhile, millet and buckwheat output has been projected to increase 1.4 percent to 308,488 tonnes and 5.2 percent to 10,870 tonnes respectively this year.

3 more foreign airlines plan to serve TIA from Jan

2014-12-11T00:18:00.001-08:00

SANGAM PRASAIN
KATHMANDU, DEC 10 - Three new international airlines are poised to serve Kathmandu ’s Tribhuvan International Airport (TIA) from January. Malaysia-based Malindo Air, Dhaka-based Regent Airways and Chengdu-based Sichuan Airlines have applied for operation authorization, said the Ministry of Culture, Tourism and Civil Aviation.

All the three carriers plan to operate daily flights to TIA from their respective hubs. At present, TIA is served by 26 international airlines.

Ministry officials said that Malindo had applied to fly the Kathmandu -Kuala Lumpur route from January 18 with Boeing 737 aircraft. It will be the third carrier from Malaysia after Air Asia X and Malaysia Airlines.

The officials said that the entry of Malindo into the Kathmandu -Kuala Lumpur sector would further intensify the airfare war. This route has emerged as the one of the most lucrative sectors for airlines with a continuous surge in the number of Malaysia-bound migrant workers.

Currently, low-cost carrier Air Asia, which entered the Nepali market in June 2012, operates 11 weekly flights, while Malaysia Airlines that entered the Nepali market in September 2012 has been operating double daily flights on the sector.

Nepal’s national flag carrier Nepal Airlines currently serves the sector with a daily flight. According to TIA statistics, the growth of Malaysia Airlines and Air Asia has been exceptional. In the first six months of 2014, Malaysia Airlines flew 88,686 travellers, up 142.11 percent year on year, while Air Asia flew 105,888 passengers, up 86.46 percent.

As the existing air service agreement (ASA) between Nepal and Malaysia allows airlines to operate 21 flights per week, the government has allocated seven additional flights under the temporary operating permits scheme to cope with increased travel demand.

As the available frequency under the ASA has been almost used up, the pact is scheduled to be revised by the first week of January, ministry officials said. Malaysia has asked the Nepal government to raise the frequency to 42 flights per week.

Meanwhile, Dhaka-based Regent Airways, a wholly-owned subsidiary of business conglomerate Habib Group of Chittagong, plans to fly to Nepal from mid-January with Boeing 737 aircraft. Travel trade entrepreneurs said that Regent, which is more focused on the Dhaka-Kuala Lumpur route, has also targeted Malaysia-bound Nepali migrant workers.

Malaysia is the top recruiter of Nepali migrant workers. According to the Department of Foreign Employment, 156,770 migrant workers left for Malaysia in 2012-13 against 98,367 in 2011-12.

Regent will be the third carrier from Bangladesh to serve TIA after Biman Bangladesh and United Airways. Dhaka-based GMG Airlines stopped its Nepal services one and a half years ago.

Meanwhile, Sichuan Airlines has announced plans to operate a daily service on the Chengdu-Lhasa- Kathmandu sector which will make it the fourth Chinese carrier to link Nepal. The Chengdu-based airline said that it would start flying to TIA from January. Sichuan Airlines maintains an all-Airbus fleet of 93 aircraft.

Travel trade entrepreneurs said that Chinese arrivals to Nepal had been exceptional prompting airlines to increase their frequency. As per TIA stats, Air China, China Eastern and China Southern saw their passenger occupancy grow 20.15 percent to 99,088.

Seven airlines have suspended their Nepal operations in the last two years. Jet Lite withdrew its Nepal flights after its merger with Jet Airways.

Other operators GMG Airlines, BB Airways, Kingfisher Airlines, Bahrain Airlines, Gulf Air and RAK Airways have also pulled out of Nepal.

TIA posts 13.5pc growth in passenger traffic in first half

2014-12-08T01:22:00.000-08:00

SANGAM PRASAIN
KATHMANDU, DEC 07 - Tribhuvan International Airport (TIA) recorded a double-digit growth of 13.53 percent in passenger traffic in the first six months of 2014, thanks to increased movement of tourists and migrant workers.

A total of 1.722 million passengers passed through country’s sole international airport over the review period, against 1.517 million a year ago, TIA data showed.

Flight movements rose 13.13 percent to 12,672. On an average, 70 international flights took off and landed daily. The airport has seen a robust passenger and aircraft traffic growth since 2003.

“The growth in migrant workers’ movement, besides increased tourist arrivals, contributed to the rise passenger traffic,” said Hari Man Lama, managing director of Incentive Tours and Travel and general sales agent of Air Asia X.

He said a rise in arrivals from Southeast Asian nations—which are witnessing a rapid economic growth—compared to the European segment, also boosted Nepal’s tourism. “Chinese arrivals have been exceptional.”

Industry insiders predict the growth will continue in the next year as almost all international carriers connecting Nepal have doubled their flight frequency amid growing travel demand. Except a few, the airlines have seen double-digit growths in terms of passenger occupancy.

The TIA stats show India’s Jet Airways reached the top spot for the first time in terms of passenger carriage. It flew 176,585 travellers in the first six months, up 10.39 percent. Jet operates five daily flights—three on Kathmandu -Delhi and two on Kathmandu -Mumbai sectors.

Doha-based Qatar Airways slipped to the second spot with 171,712 passengers, down 2.62 percent.

Low-cost carriers (LCC) Air Arabia and Fly Dubai stood third and fourth, with 29.50 percent and 13.85 percent passenger growth, respectively. Air Arabia and Fly Dubai received 133,376 and 130,581 passengers, respectively.

India’s flagship Air India slipped to fifth spot with a meagre 1.65 percent passenger growth. It flew 123,599 travellers. Growth of Malaysia-based Malaysia Airlines and Air Asia X has been exceptional. Malaysia Airlines flew 88,686 travellers, up142.11, while Air Asia flew 105,888 passengers, up 86.46 percent.

However, Nepali flag bearer Nepal Airlines slipped to the seventh spot, recording a negative growth of 13.33 percent to 97,125 travellers. Nepal Airlines’ market share shrank to 5.63 percent in the review p-period.

India’s no-frills career SpiceJet saw a meagre 1.72 percent passenger growth, while IndiGo Airlines posted a 13.15 percent growth.

The TIA stats show four Indian carriers—Jet, Air India, Spice Jet and IndiGo—commanded a 26.67 percent market share. Five no-frills carriers—Air Arabia, Fly Dubai, Air Asia, SpiceJet and Indigo—took 30.71 percent market share. Abu Dhabi-based Etihad Airways flew 88,984 passengers, up 37.51 percent year-on-year. The stats show three Chinese carriers—Air China, China East-ern and China Southern—saw their passenger occupancy grow 20.15 percent to 99,088.

Thai Airways and Singapore-based Silk Air saw their passenger numbers drop 9.85 percent to 68,897 and 8.98 percent to 22,506, respectively.

Korean Air and Dhaka-based United Airways posted a 6.30 percent and 76.83 percent drop in passenger occupancy, respectively. Bangladeshi flag carrier Biman posted a growth of 54.55 percent to 41,438.

Top 10 airlines (Passenger traffic JAN-JUNE 2014)

Airlines 2013 2014 Change (%)

Jet Airways 159,951 176,585 10.39

Qatar Airways 176,339 171,712 -2.62

Air Arabia 102,992 133,376 29.50

Fly Dubai 114,690 130,581 13.85

Air India 121,585 123,599 1.65

Air Asia 56,787 105,888 86.46

Nepal Airlines 112,068 97,125 -13.33

SpiceJet 90,439 91,998 1.72

Etihad Airways 64,708 88,984 37.51

Malaysia Airlines 36,630 88,686 142.11

(Source: TIA)

More wings across the Himalaya in the works

2014-12-04T23:13:00.001-08:00

SANGAM PRASAIN
KATHMANDU, DEC 03 - More wings across the Himalaya are in the works. Sichuan Airlines has announced plans to operate a daily service on the Chengdu-Lhasa- Kathmandu sector which will make it the fourth Chinese carrier to link Nepal. The Chengdu-based airline said that it would start flying to Tribhuvan International Airport (TIA)

from January. Sichuan Airlines maintains an all-Airbus fleet of 93 aircraft.

Himalayan Airlines, a joint venture between Tibet Airlines of China and Nepali investors, has declared that it will be operating Kathmandu -Lhasa flights from February-March. The carrier plans to lease at least three Airbus A320 jets in the first year and expand its fleet to five aircraft in the second year. It aims to add the Kathmandu -Chengdu sector to its network immediately after starting its Lhasa service.

Presently, China Southern, Air China and China Eastern link Kathmandu and various cities in China with 35 flights weekly. China is the second largest source market after India for Nepal’s tourism.

Similarly, four Indian carriers—Air India, Jet Airways and low-cost carriers SpiceJet and IndiGo—currently serve Nepal.

The Ministry of Culture, Tourism and Civil Aviation has allowed greater participation of airlines from the northern neighbour by revising the bilateral air services agreement (ASA) on February 24 after travel demand outstripped supply.

The agreement permits airlines of both the countries to operate 56 flights per week with any type of aircraft. Under the old ASA, Chinese airlines were allowed to operate 14 flights per week. Moreover, under the revised pact, an additional seven flights per week will be added annually to make a total of 70 flights per week by 2016.

China Southern and China Eastern presently operate two daily flights while Air China flies daily. China Southern links Kathmandu and Guangzhou while China Eastern and Air China link Kathmandu with Kunming and Lhasa respectively.

“Sichuan Airlines applied to conduct flights between the two countries on Tuesday, and we will be reviewing its proposal before issuing operating authorization,” said Suresh Acharya, joint secretary at the ministry. “The rapid growth in Chinese arrivals is illustrated by the ASA between Nepal and China, and the growth momentum is likely to be quite robust in the near future.”

According to Acharya, China has been promoting Nepal as an outbound destination, and it’s a good sign for the country’s tourism. According to a report by Forbes entitled Nine Important Developments in China’s Outbound Tourism 2013, Nepal’s exotic location has made it popular among Chinese tourists. In August, Chinese Ambassador to Nepal Wu Chuntai had said that the number of Chinese tourists to Nepal would reach 250,000 within a couple of years with increased flights between the two countries and land connectivity through Rasuwa and trans-Himalayan roads.

Chinese arrivals to Nepal crossed the 100,000 mark last year reaching an all-time high of 113,173, largely due to improved air connectivity between Nepal and China, said the Tourism Ministry.

The figures released by the ministry showed that air arrivals jumped 55.3 percent to 62,616 and overland travellers surged 44.7 percent to 50,557. Arrivals from China in 2012 amounted to 71,861 persons. Around 93 percent of the Chinese tourists were first time visitors to Nepal.

Travel trade entrepreneurs said that the planned railway link to Nepal from China is expected to boost Chinese arrivals in a big way. Nepal has witnessed a constant growth in Chinese arrivals since June 2009. Although Nepal had been given the Approved Destination Status (ADS) by the northern neighbour in 2002, the number of Chinese tourists was nominal. In 2002, the China National Tourism Administration granted the ADS to Nepal, and in June the same year, Chinese citizens began visiting Nepal officially for the first time as tourists.

Sichuan Airlines has appointed Society Travel as its general sales agent in Nepal. “We are excited that Sichuan Airlines has chosen Kathmandu as its latest destination as Chinese travellers are our fastest growing source market, and we expect that the link will further stimulate growth,” said Rabi Chandra Singh, chairman of Society Travel.

New Irrigation Bill being prepared for better mgmt of sector

2014-12-04T23:11:00.003-08:00

SANGAM PRASAIN
KATHMANDU, DEC 05 - The Ministry of Irrigation is drafting a new Irrigation Bill aimed at promoting better use of water to boost farm production and productivity in the context of changing land-use and water availability.

As the existing Irrigation Regulation had been prepared under the Water Resources Act 1992 under the then Ministry of Water Resources, ministry officials said the proposed bill had been intended to create a self-governing law for irrigation. In 2009 during the premiership of Madhav Kumar Nepal, the Ministry of Water Resources was divided into Energy and Irrigation ministries.

“The draft is in the initial phase and two rounds of meetings have been conducted so far,” said Madhav Prasad Regmi, secretary of the ministry. “As the irrigation dimension has changed a lot over a decade, there was a need for a separate law to govern this sector,” he said. The ministry has been preparing a draft outline of the proposed bill which will be discussed by various parliamentary committees and other stakeholders, he added.

In the past, large-scale irrigation systems were built to supply water to farmers for a limited number of crops by diverting water from rivers and streams. However, with the changing context, there are now many new challenges in the implementation of irrigation projects, Regmi said.

In Nepal, the rains have been erratic, and even at times of abundant rain, flash floods become major concerns. Floods and landslides this year have destroyed crops, mainly paddy, on 35,000 hectares. In areas without irrigation schemes, farmers have been left to count their losses.

The government has long touted irrigation schemes as key infrastructure that could boost agricultural production. Billions of rupees have been invested by the government in four mega-irrigation projects—Sikta, Rani-Jamara-Kulariya, Babai and the Bheri-Babai Diversion Multipurpose Project. Likewise, the Mahakali, Bagmati and Sunsari-Morang irrigation projects are in the construction phase.

There are more than a dozen medium irrigation projects and a large number of community-managed irrigation projects in the country. The country’s farm production has been undermined by lack of irrigation infrastructure and poor management of the existing irrigation schemes. Subsidies and the operation of small and large irrigation projects have not been up to the mark. “All these problems point to the need

for an effective law to implement irrigation schemes properly,” Regmi added.

A poor monsoon is terrible news for Nepal’s agriculture, given the limited irrigation facilities and heavy reliance on rain-fed farming. Economic Survey 2013-14 showed that irrigation coverage has been extended to 1.76 million hectares out of 2.64 million hectares of arable land. However, round-the-year irrigation facilities are only available for around 20 percent of the arable land.

Fluctuating rainfall determines the course of the country’s

farm sector that accounts for about 36 percent of Nepal’s gross domestic product.

Because of an early monsoon and timely rainfall, Nepal recorded an all-time high food grain production of over 9.45 million tonnes in 2011-12. As a result, the economic growth rate rose to 4.6 percent that year. Paddy output amounted 5.072 million tonnes, up 13.7 percent compared to 2010-11.

The climate, however, did not favour paddy farmers in 2012-13. Nepal’s annual output of cereal crops dropped by 7.6 percent to 8.73 million tonnes, largely due to a fall in paddy output. Paddy output dropped by 11.3 percent and the economic growth rate slumped to a six-year low of 3.5 percent, the lowest since 2006-07.

This fiscal too, Nepal’s paddy output has been projected to drop significantly due to insufficient rainfall, landslides and floods. Government officials say unfavourable climatic behaviours could be a huge setback to achieving this fiscal year’s targeted 6 percent growth in paddy production. Not only did the monsoon arrive 10 days behind schedule this year, rainfall was weak throughout the country.

The Food and Agriculture Organization (FAO) of the United Nations said that the harvesting of this year’s paddy crop had just begun and would continue till mid-December. FAO forecasts this year’s rice production to reach 4.6 million tonnes, down 9 percent from last year’s bumper level but close to the average of the past five years.

The decrease has been attributed to an estimated 6 percent contraction in the area planted as a result of late and below-average monsoon which hindered sowing operations and reduced yields.

Additional damage was caused to the crop by floods and landslides across the Mid-Western and Far Western regions following heavy rains in August. Cereal import requirements for 2014-15 are forecast at 571,800 tonnes, about 10 percent above last year’s high level.

Billions pour into hotels

2014-11-29T01:26:00.002-08:00

SANGAM PRASAIN
KATHMANDU, NOVEMBER 17
Come 2018, Kathmandu will have three more international hotel chains, providing more choices to high-end international travellers visiting Nepal. When the foundation stone of the Sheraton Kathmandu was laid in early October, it marked the beginning of a new wave of investments in Nepal’s hotel sector. Promoted by MIT Group Holdings, the Sheraton Kathmandu is the first five-star hotel to enter Nepal in 15 years.

The investment rush illustrates how things are changing, and changing fast, in the domestic hospitality industry. In the last one year, two international hotel chains have entered into tie-ups with Nepali groups to build five-star properties. In January 2015, the Shanker Group plans to introduce one more renowned hotel chain into Nepal and set up another five-star hotel in partnership with a local investor.

To say that the hotel industry is going to be drastically transformed in the next five years would not be an overstatement. Buoyed by an improved business outlook, Nepal’s business houses are making their first serious investment drive in the hospitality sector. After staying away from the hotel business for so many years, leading business houses are now pouring billions into it.

Estimates suggest that close to 10,000 rooms are under development in major tourist cities across the country, which is expected to ease a huge shortage of rooms, as tourist arrivals to Nepal have doubled since 2011 to nearly a million. Around Rs 30 billion will be pumped in the development of big and small hotels by 2018. According to the Department of Tourism, 24 new star and tourist standard hotels are being built across the country.

The investment boom in the tourism industry actually started three years ago, when the government decided to celebrate 2011 as Nepal Tourism Year. Against a backdrop of sustained growth in international arrivals, the government’s announcement worked as a catalyst for spurring investments in the hotel sector. The success of the campaign also led the government to launch another ambitious target of hosting two million tourists annually under Vision 2020.

A big part of the need for more hotel rooms has come with the government’s initiative to build new airports in Bhairahawa, Pokhara and Nijgadh. “The current scenario in the hospitality industry is promising. More and more investors are pouring millions of rupees to build hotels across the country nowadays,” says Gautam Das Shrestha, a veteran hotelier. “Nepal’s political scenario is changing with a more peaceful environment, and investors are coming back,” adds Shrestha, who headed Hotel Association Nepal in 1998.

Since the last two years, most five-star properties have reported extraordinary revenue collection due to higher room rates and occupancy levels. Hotel operators say that the average room tariff in Nepal has crossed the $100 mark, suggesting greater demand for rooms in the near future.

The hard times are over
After remaining closed for one-and-a-half decades, the celebrated Hotel Yellow Pagoda has made a comeback in a new avatar. The three-star property, which held a distinguished spot in Kathmandu’s hotel scene from the early 1970s to the 1980s, has reopened its doors, completely refurbished and modernised. This reflects the growing confidence in Nepal’s hospitality industry emerging from the effects of the conflict.

“We decided to reintroduce the hotel under new management as the tourism scenario has changed a lot now, and the industry’s future also looks promising,” says Anil Rajbhandari, managing director of the hotel. The new management has invested Rs 650 million in the property.

The decade-long conflict had a collateral impact on the hospitality sector. Although tourists were not harmed by the insurgents, arrivals started to decline. Even five-star rooms were available for less than $50 per night as Nepal was convulsed by a decade-long armed insurgency from 1996-2006.

The post-conflict scenario was more painful for entrepreneurs. The advent of militant labour forced a number of star hotels to shut down as the hospitality sector faced the brunt of labour unrest. Established hotels like Woodland, Yellow Pagoda, Narayani, Blue Star, Sherpa and Durbar shut their doors. There was no major investment in hotels until Jana Andolan II, in 2006.

“Going back more than a decade, in truth, it was a hard time for hoteliers because of the unpredictable Nepal bandas and labour strikes, particularly in the hospitality industry,” says Shrestha, the former owner of Sherpa Hotel. “In such a scenario, what could tourists who come to Nepal to relax expect, and how could one expect new investments in the hotel sector?”
While many hotels closed down, the ones that bravely stayed open were engaged in a struggle to survive. They started adopting a new kind of business strategy--putting heads in beds at any cost--by offering massive discounts. Hotels stayed filled by undercutting each other. This led to Nepal’s becoming known among the world’s cheapest destinations. “Travel and Tourism Competitiveness Report 2013”, published by the World Economic Forum (WEF), revealed that Nepal offered the most competitive hotel prices in the world after Gambia. The average room tariff in Nepal was reported to be $52.70.

“As five-star hotels were selling their rooms at an average price of $80, there was no room for small hotels to grow,” says Rajbhandari.

The Chinese are coming
The announcement of 2011 as Nepal Tourism Year was a major catalyst spurring investors to pump money into the hotel sector. Apart from the three major tourist destinations, Kathmandu, Chitwan and Pokhara, new hotels have started to come up in cities like Dhangadhi, Nepalgunj, Bhairahawa and Butwal. The new hotels coming up in these cities are from new investors.

Moreover, tourism entrepreneurs have realised the potential of Chinese tourists and are looking to tap into the lucrative market. Nepal was given the ‘Approved Destination Status’ by India in 2002.

Nepal received 8,000 Chinese tourists that year, and their arrivals have now crossed the 100,000-mark, reaching an all-time high of 113,173 last year. According to a report published by “Forbes”, entitled “Nine Important Developments in China’s Outbound Tourism 2013”, Nepal’s exotic location has made it popular among Chinese tourists.

“The proposed railway connection between China and Nepal will add huge impetus to Nepal’s tourism,” says Shankar Prasad Pandey, former tourism secretary. “Increased Chinese arrivals are indeed the basis for the improved investor confidence in the hospitality sector.” Political uncertainty has affected the hospitality industry most in past years. “Nevertheless, investor confidence has rebounded as Nepal has much potential to grow in the tourism sector,” he adds.

Indian Prime Minister Narendra Modi’s remark during his visit in August that the world was watching Nepal’s peace process and that Nepal had set an example by shunning violence has also helped to boost the country’s tourism image, particularly among a growing body of Indian travellers.

Enter the investors
What makes the latest surge in investments noteworthy is that besides the country’s established business houses increasingly getting involved in the hotel business, a number of international franchises and chains are returning to Nepal. Some of the country’s well-known conglomerates, such as the Chaudhary Group, Vaidya Organisation, Shanker Group, Golyan Group, TM Dugar Group and Laxmi Group, are investing billions in new hotels.

Chhaya Centre, a business conglomerate, has started constructing a five-star hotel-cum-shopping complex in the tourist hub of Thamel with an investment of Rs 3 billion. The 175-room property is being constructed on 15 ropanis of land and the main building of the centre will be 15 storeys high. “We have planned to launch the modern hotel by 2016,” says Suman Pandey, one of its promoters.

Likewise, Epi[K]urean Hotels & Lifestyle Thailand has announced its expansion plan in Nepal with an Epi[K]urean Villas class luxury resort. The Leaf Nagarkot, Nepal will be the first luxury managed villas and resort in the country. The resort is scheduled to open towards the end of 2015 and its name will be announced soon.

The Golyan Group has planned to open a 224-bed hotel in Kathmandu with an outlay of Rs 750 million. The Yeti Airlines Group is also reportedly planning to construct two five-star properties in Pokhara and Lumbini. The Sheraton Kathmandu Hotel marks the re-entry of the Sheraton brand in Nepal. It had earlier managed the Hotel Everest as the Hotel Everest Sheraton in the 1980s. After the Hyatt Regency, no other international hotel chain had come to Nepal.

Official records show that two five-star hotels, the 218-room Sheraton Kathmandu Hotel on Kantipath and the 221-room five-star deluxe hotel in Nagpokhari, Naxal, under the banner of Marriott International, are expected to come into operation by 2018. A 10-storey, four-star hotel with 108 rooms in Thamel, named the Fairfield, by Marriott Kathmandu, is also scheduled to be completed and come online by the end of 2015. International brand Marriott will look after the management of the Fairfield.
The Shanker Group’s Executive Director Sahil Agrawal says, “Nepal’s tourism future looks promising. The current scenario shows that the hotel occupancy rate has jumped 75 percent while in the peak season hotels are unable to cater to demand.” Agrawal says that the way hotels are expanding in Nepal show that they have an eye on catering to Chinese tourists whose numbers are expected to grow tremendously in the near future.

Still, some travel trade entrepreneurs caution that recent aviation disasters and avalanches in Nepal’s world-famous trekking and mountaineering destinations could impede tourism growth.

The figures
The Tourism Ministry’s statistics show that the occupancy rate in five-star hotels dropped to 58.85 percent last year from 62.76 percent in 2012. Out of the 678,535 room nights produced last year, only 399,318 were occupied. There are 10 five-star properties in Nepal, eight of them in Kathmandu and two in Pokhara.

Hoteliers say that Nepal’s five-star hotels encountered a glut of rooms in 2013 due to a proliferation of new accommodation ranging from guest houses to home stays, which drew away potential customers from luxury properties. In the hospitality sector, an occupancy rate of above 40 percent is considered a “survival” rate, and a rate higher than 50 percent is termed “fair”. An occupancy rate of above 60 percent is “good” and 70 percent and higher is considered “excellent”.

Gautam Das Shrestha says the anticipated surge in the hospitality industry will have a positive effect on growth, but that it would take some more time to recover from past setbacks. The country received 797,759 tourists last year, and their average length of stay was 12.57 days.

The ministry stats show that the number of star and tourist-standard hotels in Kathmandu has increased by around 32 percent over the last five years. The number of star and tourist-standard hotels in Kathmandu reached 557 in 2013, from 422 in 2009. Likewise, the number of hotel rooms increased by 26 percent over the period to reach 11,835 rooms, against 8,813 in 2009.

NEW PROPERTIES

Shesh Ghale
Sheraton Kathmandu
218 rooms, five-star hotel
Kantipath, Kathmandu

MS Group
Marriott International
221 rooms, five-star deluxe
Naxal, Kathmandu

Fairfield by Marriot
108 rooms, four-star hotel
Thamel, Kathmandu

Vaidya Organisation
Deluxe boutique hotel
Gairigaun, Kathmandu

Golyan Group
Baneshwor Height, Kathmandu
224 beds

Yeti Group
Two five-star properties in Pokhara and Lumbini

Laxmi Group
Two four-star properties in Kathmandu and Pokhara

Shanker Group
250 beds, five-star
Naxal, Kathmandu

Chhaya Centre
175 rooms, five-star hotel-cum-shopping complex
Thamel, Kathmandu

Preparing farmers for climate change

2014-11-29T01:22:00.001-08:00

SANGAM PRASAIN
KATHMANDU, NOV 25 - Nepal’s paddy output has been projected to drop significantly this year due to insufficient rainfall, landslides and floods. Government officials say unfavourable climatic behaviours could be a huge setback to achieving this fiscal year’s targeted six percent growth in paddy production. Not only the monsoon arrived 10 days behind its normal time this year, rainfall was weak throughout.

The Ministry of Agricultural Development statistics show that this year’s paddy transplantation was completed on less then 90 percent of the 1.52 million hectares land. In the same period last year, paddy transplantation was completed on 98 percent of the country’s paddy fields.

In the wake of reduced paddy transplantation this year, some of the lawmakers has demanded that some Tarai districts be declared “drought-hit” areas and farmers be compensated.

Mekh Bahadur Gurung of Fulbari village in Taplejung district planted pulses instead of paddy because of inadequate rainfall this year. Kali Bahadur Angbang of Hangpang village in the district also switched to maize farming. Similar shift in farming pattern was witnessed in Ilam district as well. Bhim Bahadur Bishwakarma of Chulachuli had sown paddy saplings on his land, but he did not transplant them due to poor rainfall and lack of irrigation.

Because of early monsoon and timely rainfall, Nepal recorded an all-time high food grain production of over 9.45 million tonnes in 2011/12. As a result, the economic growth rate rose to 4.6 percent that year. Paddy output amounted 5.072 million tonnes, up by 13.7 percent compared to 2010/11.

The climate, however, did not favour the paddy farmers in 2012/13. Nepal’s annual output of cereal crops dropped by 7.6 percent to 8.73 million tonnes, largely due to fall in paddy output. Paddy output dropped by 11.3 percent, and the economic growth rate slumped to a six-year low by 3.5 percent, the lowest since 2006-07. The area under paddy cultivation shrank 7.2 percent to 1.42 million hectares, while paddy productivity dropped 4.3 percent to 3,171 kg per hectare.

These are few examples that Nepal has been experiencing because of changing climate patterns, including the variability in rainfall and seasons. Problems like drought, floods and landslides have been affecting agricultural crops and their output.

In the recent years, Nepal has also been witnessing wide precipitation, recording rainfall at a single location and leaving gaps in spatial coverage. This year, for example, there were rain deficit in eastern Tarai and western regions, whereas the far-western region had normal rainfall. The mid-western region, at the same time, received heavy rainfall, causing floods and landslides.

According to the Department of Agriculture reports, floods and landslides country wiped out up to 35,040 hectares of farm land in different parts of the country. Floods and landslides in 17 districts incurred an estimated loss of Rs 1.91 billion.

Extinction of indigenous crop varieties of local basmati rice, wheat, maize and other agricultural crops is also being observed across the country in the past few years. “Obviously, conditions for paddy farming deteriorates whenever there is a change in rainfall and temperature patterns,” says Bhola Man Singh Basnet, agro expert and scientist. “The number of rainy days in Nepal has gotten shorter in the last few years.”

There used to be sufficient rainfall starting from June in the past, but the calendar has been shifting gradually, raising concerns over reduced food production. According to International Rice Research Institute one degree Celsius increase in night time temperature decreases rice production by 10 percent.

Ministry of Agricultural Development Spokesperson Uday Chandra Thakur says that the ministry has implemented early warning system since last year to reduce vulnerability of drought and other

agriculture-climate events. “The project’s task is to update on agriculture-climate risk by adopting a monitoring and early warning system to give advance notice of coming hazards. Timely information can help farmers to make crop-saving decisions and plant appropriate crops,” says Thakur.

The $31 million Pilot Project on Climate Resilience supported by the World Bank is expected to create an agricultural information management system tailored for farmers. Before the project, the government only monitored water level in rivers through manual data collection. Thakur says the new project could make farmers better prepared with reliable and updated information on meteorological, hydrological and agricultural conditions.

Besides, the government has also launched three new improved varieties of paddy seeds- Sukhha Dhan 4, Sukhha Dhan 5 and Sukhha Dhan 6-that are tolerant to extreme climatic changes. These varieties of paddy seeds, which can survive under stress and retain desirable grain qualities, are likely to be released for farmers by June next year.

These new varieties, also known as climate change-ready rice, can tolerate drought for up to one-and-a-half months and can grow under water-deficiency stresses. They have been recommended for the Tarai, inner Tarai and river basin areas.

Among these three paddy breeds, Sukhha Dhan 6 has the ability to re-grow even two week after submergence. It has an average yield of 4-4.5 tonnes per hectare, and under a good irrigation condition, the output can go up to 5.5 tonnes per hectare on an average. The plant stands 125 cm tall and the maturity period is 120-125 days. Swarna sub-1 and Sambha Mansuli sub-1 rice varieties that are flood tolerant have already been made available to farmers.

Vital links

2014-11-29T01:20:00.002-08:00

SANGAM PRASAIN
KATHMANDU, NOV 28
It’s a dirt road but at least it’s there. At Gamgadhi, the district headquarters of Mugu, I hop on a tractor —a common mode of transport here—heading for Talchha on the said dirt road. I find that I am in for a bumpy ride—with dust clouds and the cacophony made by the parts of the tractor swirling around me and the nine other passengers standing on the trailer, which is coupled behind the vehicle.

The road winds at a steady incline on a path gouged out in a slow spiral around the hills; the sides of the hills from which the road has been carved without the use of heavy machinery still show the dents and concave dings left behind by the gouging. Sloping away from the road are terraced paddy plots, where farmers are bundling haystalks into haystacks. At regular intervals, we pass riders on horses bedecked in colourful saddles and jangling bells dangling from their necks: on horseback was how most locals here used to travel long distance in the region. Now, with this dirt highway linking Gamgadhi to Talchha airport, many of the locals turn to tractors and Swaraj Mazda trucks.

Before I got to Gamgadhi, I had met twenty-year-old Hira Devi Rawal at Shreenagar VDC. I had been struck by the ornaments she wore: she had a huge star-shaped gold stud and a gold ring on her nose and gold rings on her ears; and I had been pleasantly surprised by her optimistic outlook for the region. “The first time I saw motor vehicles was when this road was being built. I bought this gold from the money I made as a construction worker for this very road. We believe that better times are ahead for us.”

Along the route to Talchha, I saw that her optimism was grounded in a lived, changing reality. The Swaraj trucks I spotted on the route were ferrying both people and produce—mostly cauliflower, rice, cooking oil and other household commodities. Although most houses along the bends of the road were small, one-storeyed traditional stone huts, every once in a while we would come across three-storeyed buildings, some with cantilevered porches, and many topped with corrugated tin roofs on which perched dish antennae.

The money for these amenities came from the commerce the road has made possible and also on account of the work the locals did in building the road. Today, farmers from the region ferry their produce to Gamgadhi, which has become a bustling trading hub and a growing marketplace, and carry back to their villages clothes and other household items brought to Mugu from Surkhet, which is linked by the Karnali Highway; that major highway was constructed two years ago.

The 9 km Gamgadhi to Talchha road is part of the greater Nagma-Gamgadhi route, and part of the network of feeder roads that link to the Karnali Highway. Before the Karnali Highway came along, it used to take at least seven or eight days for locals to get to Surkhet. “Now, that travel-time has been reduced to three days,” I had been told by 68-year-old Shri Chandra Rawal, whom I had met earlier at Shreenagar.

“In the past, those who had enough money would fly to Nepalgunj to get treated at hospitals there, and for local businessmen the cargo fare for their goods used to be more than Rs 100 per kg,” he said. “But for the rest of us, walking for eight days was the only way we could get to Nepalgunj.” And that old air-freight rate—because of the competition from cargo trucks plying the highway—has now plummeted to Rs 60 per kg.

The progress I am witness to as I ride the tractor is a product of the Decentralised Rural Infrastructure and Livelihood project, which the government kicked off in 2006, with support from the Asian Development Bank. The cornerstone of the project is the 16 km Gamgadi-Talchha-Rara road, which connects the hinterlands with Talchha airport. The road was constructed at a cost of Rs 140 million. The project has benefited three VDCs—Pina, Shreenagar and Kakridanda. And similar projects are picking up pace. A 15.5 km Kalakandalek-Khamel-Kawa route, another road project that started last month, will eventually link Mugu to Gothi Jewala, in Jumla. These two projects have linked 12 VDCs, benefiting around 55,000 people of Mugu.

After one hour of standing on the hard metal floor of the tractor-trailer, and with my palms starting to develop callouses from gripping the iron hand-rail, we finally reach Talchha, from where I’ll be flying back to Kathmandu. At Talchha, I come across 60-year-old Amar Bahadur Malla of Topla VDC. He says he earned Rs 200,000 a year when he worked as a construction worker on the road. Another local, Prem Bahadur Shahi, of the same VDC, says he built himself a house with the Rs 250,000 he earned from similar work. As many as 2,000 workers were engaged in the construction of the road each day because no bulldozers and excavators were used to carve a path through the terrain.

And if the locals can capitalise on the opportunities brought by the new roads in the region and get going with their nascent tourism industry, say locals, the desperately poor Karnali region might finally see better days as a whole. Today, there is a 7 km dirt road linking Talchha to Mathillo Mili Chaur, which lies an hour’s walk away from the famous Rara Lake. The locale around the lake is blessed with stunning scenery and could prove to be a huge draw for tourists, both local and foreign. The road access has reduced the travel-time to Rara, and a few enterprising locals have now set up lodges and tea shops alongside the road.

Bir Bahadur Rawal, chief of the District Technical Office in Mugu, is more than happy with how things have picked up pace here. “The area will gradually see increased numbers of tourist footfalls,” he says. “We got these roads a long time after the regions in the rest of the nation already had theirs. We got them late. But at least we have them now. It’s at least a beginning.”

Have cash, will dash...Investments in hotels soar as the country’s tourism industry rebounds with a vengeance

2014-11-11T22:39:00.001-08:00

SANGAM PRASAIN
NOV 12 - Nepal will be injecting more than Rs 150 billion into the development of tourism and airport infrastructure in the next five years reaffirming the belief that tourism will remain one of the most promising sectors of the economy in the near future.

The surge in investment activity is indicative of a positive market sentiment and growth outlook. Industry insiders say that apart from a positive international tourist arrivals outlook, the burgeoning middle class and higher disposable incomes have also aided the growth of domestic travel.

Lack of aviation infrastructure continues to hurt Nepal’s tourist arrivals, which could hit the 3-million mark if the country gets a new international airport and cuts down its overdependence on Kathmandu’s Tribhuvan International Airport (TIA). Currently, Nepal receives 800,000 tourists, and their contribution to the country’s GDP stands at a meagre 2 percent.

Realizing that investments in the development of tourism infrastructure ensure an efficient gateway for visitors, the government is currently undertaking two regional international airport projects in Bhairahawa and Pokhara respectively with a combined investment of Rs 31 billion.

Heartened by the launch of the two regional international airport projects, the government has moved to revive the stalled second international airport (SIA) project in Nijgadh, Bara district. The SIA scheme envisions building a modern airport in the southern plains 175 km from Kathmandu as an alternative to congestion and winter fog at TIA, the country’s sole aerial gateway.

As per the study, the proposed airport will be able to handle 15 million passengers annually and even accommodate the super jumbo Airbus 380 after the first phase of construction.

The estimated investment for the first phase, according to the feasibility study, would be $600 million. In the second phase, the airport would be expanded to accommodate 30 million passengers annually. By the end of the third phase of construction, the airport would have a parallel runway enabling it to handle 60 million passengers annually.

Nepal relies heavily on air services to bring in international visitors, with 75 percent of the tourists arriving by air. An additional international airport will also provide a boost to domestic air traffic.

“Obviously, there has been encouraging investments in airport infrastructure,” said Mohan Krishna Sapkota, spokesperson at the Ministry of Culture, Tourism and Civil Aviation. “Once these projects are online, they will address the major bottlenecks that Nepal’s tourism has been facing for a long time.”

The proposed Gautam Buddha regional international airport in Bhairahawa, the birthplace of Gautam Buddha, will come into operation after three years, and it will be a major hub for Buddhist pilgrims, he said. Likewise, the new international airport in Pokhara will come into operation after four years. “The SIA project has also gained momentum.”

Besides launching the new projects, the government has started upgradation of TIA. Around Rs 10 billion is being spent to improve TIA, and there are plans to rehabilitate its 47-year-old runway. The occurrence of cracks in it has frequently disrupted flights.

Air transportation is important for a landlocked country like Nepal as it serves not only to spur trade and growth in the tourism industry but also to improve people’s mobility. And a strong national flag carrier indeed plays a crucial role in the overall economic development.

After a bumpy flight through much of the past two decades, Nepal Airlines Corporation (NAC) has set a course towards revival.

The venerable carrier has invested more than Rs 14 billion to make an impressive rebound. By mid-2015, NAC will possess eight new aircraft including two Airbus 320s. The ailing carrier currently has two ageing Boeing 757s to serve its international route and three small-sized aircraft to serve domestic routes. Two of the three aircraft were recently gifted by China.

“On an average, the ministry has been pumping Rs 8 billion into airport and other tourism infrastructure development. Out of the total investment, Rs 1.5 billion has been set aside for trekking and other infrastructure development,” said Sapkota.

The ministry is also drafting a Tourism Strategy Plan that aims to spend 60 percent of the total budget allocated to the ministry on infrastructure and 25 percent on marketing and branding of Nepal’s tourism, he said.

The private sector is also pouring money into the aviation sector. The aviation industry has seen two start-up carriers this year—Himalayan Airlines and Sourya Airlines. Sourya Airlines is scheduled to start domestic operations with Bombardier CRJ 200 jets, while Himalayan Airlines, a joint venture between Tibet Airlines of China and Nepali investors, plans to start commercial operation soon.

Likewise, Goma Air has put its new 19-seater aircraft into service. The plane will serve short take-off and landing airfields, including tourist sectors like Lukla and Jomsom, with its Czech-made LET410 UVP- E20 aircraft. It plans to buy another aircraft in five months. The helicopter sector has also been growing at a fast rate on the back of tourism and development activities.

Anil Manandhar, general manager at Shree Airlines, said they had bought three helicopter and plan to add two more by 2015.

“We have invested Rs 1.20 billion in the new choppers,” Manandhar said, adding that their confidence reflects the growth of the tourism industry. “As there has been growing demand for rescue and sightseeing, we have come up aggressively in the market,” he said. Shree is the largest rotor-wing operator in the country with nine choppers. Simrik Airlines has also added two helicopters, while Manang Air plans to add one chopper to its current fleet of two choppers.

Among the various sectors in the tourism industry, an exciting trend is happening in the hotel business . More that Rs 15 billion has been spent on the development of big and small hotels in the past few years, and another Rs 30 billion is projected to be spent by 2018. According to the Department of Tourism, 24 new star and tourist standard hotels are being built across the country. Kathmandu will have three more international hotel chains giving more choices to high-end international travellers visiting Nepal.

According to officials, two five-star hotels, the 218-room Sheraton Kathmandu Hotel on Kantipath and the 221-room five-star deluxe hotel in Nagpokhari, Naxal under the banner of Marriott International, are expected to come into operation by 2018. A 10-storey four-star hotel with 108 rooms in Thamel, the Fairfield to be managed by Marriott Kathmandu, is also scheduled to be completed and come online by the end of 2015.

Chhaya Centre, a business conglomerate, has started constructing a five-star hotel-cum-shopping complex in the tourist hub of Thamel with an investment of Rs 3 billion.

Some of the country’s well-known conglomerates such as the Chaudhary Group, Vaidya Organization, Shanker Group, Golyan Group, TM Dugar Group and Laxmi Group are investing billions in new hotels. “A more conducive environment has attracted massive investments in the hotel industry,” said Prabesh Aryal, executive director of Hotel Association Nepal.

“Apart from Kathmandu, investors have started developing hotels in most of the cities across the country.” Pokhara, Chitwan, Nepalgunj, Dhangadhi, Jhapa, Itahari, among others have seen a significant development of big and small hotels.

According to Aryal, the surge in investments is not only due to positive arrival trends but also due to Nepal’s burgeoning middle class and higher disposable incomes. For example, tourist hotspots like Pokhara and Chitwan are largely occupied by domestic visitors these days.

“In fact, greater wanderlust among Nepalis has led to higher demand for hotel rooms across the country.” But there needs to be balanced growth in terms of international tourist arrivals, he said. “It will become a big problem if there is surplus accommodation against travel demand.” As riding in cable cars has become an extremely popular activity in Nepal, the government and private investors have poured big money into the sector.

The Tourism Ministry has conducted pre-investment and pre-feasibility studies for cable car projects in different places in Nepal in a bid

to attract the private sector and FDI.

Thankot-Chandragiri and Budhanilkantha-Shivapuri cable car lines in Kathmandu, Phulchoki-Godavari in Lalitpur, Phewa Tal-Sarangkot in Pokhara, Dhunche-Gosainkunda in Rasuwa, Kalinchok Bagwati-Suspa Bazaar in Dolakha, Rani-pauwa-Kagbeni in Mustang, Pathibhara in Taplejung and Swargadwari in Pyuthan have been proposed to be built under the public private partnership model.

Proposed investment

Area Amouint

Second International Airport Rs 60 billion

Regional International Airport, Pokhara Rs 21 billion

Regional International Airport, Bhairahawa Rs 10 billion

Tribhuvan International Airport Rs 10 billion

Nepal Airlines Rs 14 billion

Domestic Airlines Rs 4 billion

Hospitality Industry Rs 30 billion

Cable Car Rs 8 billion

Trekking Infrastructure Rs 1.5 billion

Proposal to ratify seed bank accord approved

2014-11-04T22:48:00.001-08:00

SANGAM PRASAIN
KATHMANDU, NOV 4

Parliament on Tuesday approved a proposal presented by the Ministry of Agricultural Development to ratify the agreement on the establishment of a Saarc Seed Bank.
According to Mahendra Poudel, under-secretary at the ministry, Nepal signed the pact to establish the bank during the 17th Saarc Summit held in Addu City of the Maldives in 2011. Four countries -- India, Sri Lanka, Bhutan and Bangladesh -- have ratified the accord to create a mechanism to guarantee food security.
South Asia has put in place a collective mechanism to ensure food security as agriculture and food production has been hit by recurring floods, droughts and other erratic weather conditions caused by global warming.
The agreement to set up the Saarc Seed Bank will go into effect after it has been ratified by all the member states.
The seed bank is expected to deal with seed production and exchange of varieties and seed trade among member countries, said Poudel. According to him, the bank will help member states to exchange seeds produced in their territories and help farmers to get quality seeds.
It will also help the respective countries to preserve indigenous seeds. The seed bank will particularly be useful in addressing seed shortages caused by natural calamities. For example, if any member state suffers from a natural disaster, it can withdraw the seeds stored in the bank.
After the seed bank comes into existence, Saarc countries can share and grow common varieties of seeds. Currently, each country has its particular variety of seeds, and some of them are not grown in other territories while some are restricted by intellectual property rights.
“It takes at least 10 years to develop a new seed variety, and sharing and growing common varieties of seeds in the region will not only save time but also aid exchange of technologies and techniques.”
The bank will also play a key role in introducing seed multiplication programmes and helping countries to increase their seed replacement rate. Nepal’s seed replacement rates for cereal crops are very low.
The ministry's statistics show that the rate of seed replacement in Nepal is 9 percent, and under National Seed Vision 2013-25, the government plans to increase the rate to 25 percent for cereals by 2025. By the same year, the seed replacement rate for vegetables is expected to reach 90 percent from the current 66 percent.
As many land races and indigenous genetic resources are on the verge of extinction, the bank will ensure that these precious genetic resources are well preserved for the development of climate resilient high yielding competitive varieties in the future, added Poudel.
It will ensure greater availability of quality seeds and spread high yielding improved crop varieties. As per the agreement, all the participating countries will have to allocate 1 percent of their total seed stocks towards the proposed Saarc Seed Bank.
The idea of the seed bank was proposed by Bangladeshi Prime Minister Sheikh Hasina at the 16th SAARC Summit held in Thimpu, Bhutan in 2010 and was incorporated in the Thimpu Declaration. Bangladesh then prepared a concept paper and distributed it among all the member states through the Kathmandu-based Saarc Secretariat.
Founded in 1985, Saarc consists of Afghanistan, Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan and Sri Lanka.

Chinese-made Y-12e aircraft arrives to join NAC fleet

2014-11-04T01:04:00.001-08:00

SANGAM PRASAIN
KATHMANDU, NOV 04 - Nepal Airlines Corporation (NAC) on Monday received a Chinese-made 18-seater Y-12e aircraft as part of a six-aircraft deal between Nepal and China.

The delivery of the twin-engine turboprop utility plane, a gift from China, was delayed by four months. It was built by Harbin Aircraft Manufacturing Corporation, China. The aircraft has been named Koilee which means “cuckoo” in the Nepali language.

Bearing the Nepali registration number 9N-AKS, the aircraft landed at Tribhuvan International Airport (TIA) in the afternoon. With the induction of the new plane, the ailing national flag carrier now boasts four aircraft in its domestic fleet including two Twin Otters and an MA60.

As NAC plans to serve short take-off and landing (STOL) airfields with the Y-12e, government officials said it would take some time to bring it into commercial operation due to unfinished paperwork regarding airport design standards.

The Y-12e is powered by PT6A-135A engines. It received Type Certification from the Civil Aviation Administration of China in 2002. The aircraft made its first flight in August 2001. The Y-12e currently flies in more than 15 countries. Experts said that the Y-12e would be a fitting alternative to the Twin Otter which are being phased out.

This model was certified by the US Federal Aviation Administration (FAA) on August 2, 2006. FAA utility airport design standards allow maximum grades of up to 2 percent or about 1.2 degrees of slope.

However, since most STOL airfields in Nepal including Lukla have an uphill gradient of 12 percent, the aircraft needs to be certified by the manufacturer to fly to such airports, said a government official.

NAC Managing Director Madan Kharel said that they would have to abide with the international regulation and said that certification of the aircraft to use STOL airfields would be completed soon.

Kharel said that the Y-12 aircraft had already served STOL fields in Nepal in the past, and that it would not take much time to complete the test flights with the given aircraft specifications. “We have planned to begin commercial operation after 10 days if all the processes are completed.”

The delivery of the first batch of Y-12e had been originally set for June 30. However, drawing a lesson from the two-month delay in getting its MA60 aircraft into service due to inadequate paperwork, NAC has pushed back the delivery date of the Y-12e to have ample time to prepare the necessary documentation.

The MA60, which arrived in Kathmandu on April 27, was forced to take an extended rest at TIA as NAC officials scrambled to get various documents in order, of which they said they were not aware as requirements had changed in the 27 years since they last acquired new aircraft.

Kharel said that the remaining four aircraft on order -- three Y-12e and an MA60 -- would be arriving in Nepal in three months.

The national flag carrier, which has been incurring losses amounting to Rs 170 million annually by serving unprofitable remote hubs, hopes for a dramatic revival after the delivery of its six Chinese-made aircraft.

According to TIA, there were 1.54 million domestic flyers last year. Of the total travellers, Nepal Airlines flew 20,591, down 44.15 percent from the previous year.

NTB gives marching orders to its chief

2014-10-30T23:49:00.001-07:00

SANGAM PRASAIN
KATHMANDU, OCT 31 - The 196th board meeting of the Nepal Tourism Board (NTB) held on Thursday has suspended Subash Nirola from the posts of officiating CEO and director with immediate effect. He has been charged with misusing millions of rupees in tax money.

Thursday’s meeting chaired by Tourism Secretary Suresh Man Shrestha has appointed Nandani Lahe Thapa, a senior NTB director, as the officiating CEO . The meeting also named Sudarshan Prasad Dhakal, the director general of the Department of Immigration, as a member-secretary in the NTB board.

“In accordance with the ministry-level decision on October 28 to take immediate action against graft-accused Nirola, we called a board meeting on Thursday to sack him,” said Shrestha. The board meeting was held at the ministry.

On October 22, the parliamentary Public Accounts Committee (PAC) had directed the ministry to suspend Nirola. He has been removed from the post as per NTB Regulation 2055 Rule 12 and sub-rule (5) and the NTB Act’s clause 14 (4).

Irregularities resulting in the loss of millions of rupees have been revealed in an investigation report submitted by a seven-member government panel to the ministry.

A copy of the report has also been sent to the Commission for the Investigation of Abuse of Authority (CIAA) which is also scrutinising the matter. The report stated that the country’s tourism promotion body was wracked by policy and financial corruption.

For example, the NTB allocates Rs 605,000 annually for legal consultancy services, but the actual expense amounts to more than Rs 3.68 million. Likewise, the NTB earmarks Rs 500,000 for auditing but the payment shown is Rs 4 million. NTB officials have been found to have submitted fake restaurant bills to inflate the expenses under the outstanding revenue heading.

Similarly, the money collected by issuing Trekkers’ Information Management System cards has been used arbitrarily. The probe panel uncovered hundreds of cases of misappropriation of funds.

As the NTB has not been able to perform its duties well and all the activities at the country’s tourism promotional body have come to a grinding halt, the ministry

responded to the situation promptly, Shrestha said.

He added that the ministry was committed to resuming the process of selecting the CEO in a fair and transparent manner. The NTB has been stumbling along without its head since the then CEO Prachanda Man Shrestha’s tenure expired on October 31, 2011. Twelve candidates had been short listed for the post.

The PAC has also told the ministry to urge the CIAA to begin legal proceedings against former NTB chairman Sushil Ghimire and the board of directors who have been charged with abetting corruption.

The board had amended its financial bylaws to allow it to award contracts without competitive bidding even though the Public Procurement Act (PPA) says tenders should be called before doing so.

Under the amendments to the Financial Bylaws that give sweeping powers to the NTB boss to dispense cash, the CEO can spend up to Rs 10 million at a time for tourism promotion activities inside the country.

Similarly, the chief can spend $400,000 at a time outside the country without following any due process of the PPA. The CEO has also been given the power to spend up to $400,000 at a time through honorary representatives and firms.

The bylaws also allow the CEO to purchase goods on a piecemeal basis and appoint the internal auditor of the board. The NTB board consists of 11 members, five representing the government and five from the private sector. The tourism secretary chairs the board.

Meanwhile, the ministry has formed another committee to further investigate NTB matters. The three-member panel is headed by Ratish Chandra Lal Suman, the director general of the Civil Aviation Authority of Nepal.

Nepal moves up a notch in ranking

2014-10-30T01:59:00.000-07:00

SANGAM PRASAIN
KATHMANDU, OCT 30 - It became a little easier for entrepreneurs to do business in Nepal due to regulatory reforms made in 2013-14, said the World Bank in its report Doing Business 2015: Going Beyond Efficiency published on Wednesday.

Nepal has been ranked 108th out of 189 countries on the ease of doing business index. Last year, it was placed in the 109th position. Nepal comes before the Maldives (at number 116), Bhutan (125), Pakistan (128), India (142), Bangladesh (173) and Afghanistan (183) in the South Asian region. Sri Lanka is ahead in the 99th spot. The regional average for South Asia is 134.

The report said that Nepal had eased the areas of business regulatory reform particularly dealing with construction permits that has helped the country to climb one spot in the rankings.

Doing Business sheds light on how easy or difficult it is for a local entrepreneur to open and run a small to medium-size business when complying with relevant regulations.

It measures and tracks changes in regulations affecting 10 areas in the lifecycle of a business: Starting a business, dealing with construction permits,

getting electricity, registering property, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts and resolving insolvency.

The report showed that Nepal made dealing with construction permits easier by implementing a new electronic building permit system. “Doing business is easier in economies with administrative efficiency and strong regulatory protections,” said Rita Ramalho, lead author of the Doing Business report, World Bank Group. “We are encouraged by the modernization of regulatory processes in South Asia because it is benefiting local entrepreneurs.”

In Nepal, for example, a businesswoman trying to build a new warehouse nine years ago would have spent 143 days on the construction permitting process. Thanks to the adoption of

some of the best global practices, such as a new electronic building permit system in 2013-14, this process can now be completed in 86 days.

The report showed that except for dealing with construction permits, Nepal has not done well in the other 10 areas or indicators of the lifecycle of business. Nepal rose to the 91st position from the 126th position in terms of dealing with construction permits and is behind only Sri Lanka (60th position) in South Asia. It takes 86 days in Nepal to deal with construction permits while it takes 323 days in Afghanistan, 249.4 days in Pakistan and 185.9 days in India.

“Nepal made dealing with construction permits easier by implementing a new electronic building permit system,” the report said.

Tulasi Prasad Sitaula, secretary at the Ministry of Physical Infrastructure and Transport, said that the government had reduced the timeframe for awarding contracts through reforms in the internal system. “We are substantially cutting down the timeframe in the proposed amendment to the Public Procurement Act,” he said. The government has been working to amend the act as per the changed context.

In terms of starting a business, Nepal has slipped to 104 from 97 and comes behind Afghanistan (24) and Bhutan (92). For example, it takes 17 days to start a business in Nepal while it takes seven days in Afghanistan.

It has become more difficult to get electricity in Nepal, and it has slipped to the 85th position from the 78th position in the 2014 list. It takes 70 days to get electricity in Nepal by fulfilling five different procedures. It takes 74 days in Bhutan, 178.3 days in Pakistan, 114 days in Afghanistan and 105.7 days in India.

Nepal is in the 27th position in terms of ease of registering property. It takes only five days to register property n Nepal while it takes 250 days in Afghanistan, 92 days in Bhutan and 47 days in India. “Nepal made transferring property easier by reducing the registration fee,” the report said.

Meanwhile, Nepal is ranked way down in terms of trading across borders. The World Bank report has placed Nepal in the 171st position among 189 countries, only overtaking Afghanistan (184) in the South Asian region.

The global report showed that it takes 40 days to export by fulfilling 11 documentations. However, importing goods takes 39 days. The cost of export per container is $2,545 while the cost of import is $2,650 per container.

According to the report, Singapore tops the global rankings with regard to ease of doing business. The others on the list of the top 10 economies with the most business-friendly regulatory environments are New Zealand, Hong Kong, Denmark, South Korea, Norway, US, UK, Finland and Australia, in that order.

Pokhara int’l airport project gets govt nod

2014-10-27T23:12:00.000-07:00

SANGAM PRASAIN
KATHMANDU, OCT 28 - The Cabinet on Monday gave a go-ahead for the construction of a regional international airport in the tourist city of Pokhara after the Tourism Ministry convinced the Finance Ministry that the estimated $215.96 million cost was realistic.

The decision has paved the way for the government to formally request a soft loan from the China EXIM Bank to develop the project. The bank has agreed in principle to provide a loan to the government to build the new airport, which has been in the works for 39 years, at Chinnedanda, 3km east of the existing domestic airport.

In June, the Tourism Ministry had been asked to explain the project’s cost after it approached the Finance Ministry to arrange funds immediately after the construction contract was awarded to China CAMC Engineering Co on May 22.

The Finance Ministry had initially expressed reservations about the project cost and termed it “unrealistic”. But its doubt was cleared after a high-level panel from the Institute of Engineering, Pulchowk formed by the government showed the project would cost over $216 million.

“We had submitted the panel’s report to the Finance Ministry and it was convinced this time,” said Tourism Ministry spokesman Mohan Krishna Sapkota. The project cost was then tabled at the Cabinet. Madhu Kumar Marasini, chief of the International Economic Cooperation Coordination Division at the Finance Ministry, said the EXIM bank would be approached after receiving the Cabinet notes.

The Commission for Investigation of Abuse of Authority had even seized documents related to the tender process suspecting financial irregularities. The investigation has been put on hold.

The project has been idle since July 2012 after the lowest bidder China CAMC quoted a price of $305 million, 85 percent higher than the estimate. The government had expected the project to cost around $166 million.

In January 2013, China CAMC wrote to the Tourism Ministry expressing its willingness to build the project at the government estimate. Things became more complicated after China Airport Construction Company, a consultant appointed by the China CAMC, submitted its study report to the Civil Aviation Authority of Nepal (Caan) quoting $264 million. Adding 16 percent price escalation and 13 percent VAT, the estimated outlay would come to around $300 million, nearly equal to the original cost quoted by the China CAMC.

An independent cost evaluation panel led by former registrar of Supreme Court estimated the price at $215.96 million. The ministry then presented the proposal with the latest estimated cost to the Cabinet, but the Khil Raj Regmi-led government put it on the backburner.

The project was revived by former Tourism Minister Bhim Acharya of the Sushil Koirala-led government. On April 7, a Caan board meeting chaired by Acharya approved the project with the revised cost of $215.96 million. Caan had invited bids for the project on February 9, 2012. The project will be built under the Engineering Procurement and Construction model. The EPC contract binds the contractor to deliver the project at the stipulated time with predetermined price regardless of any increase in costs that it may incur after the contract is signed.

In 1975, the government acquired more than 3,106 ropani land for the infrastructure. As per the feasibility report, the airport will accommodate medium category jets like Boeing 757 and Airbus 320.

Trekking disasters could peg back the growth of Nepal’s tourism

2014-10-21T01:30:00.001-07:00

SANGAM PRASAIN
OCT 21 - Less than six months after an avalanche in Mt Everest killed 16 mountain guides, 39 people have lost their lives in Annapurna and Dhaulagiri mountain regions in one of the worst trekking disasters this past week.

The government rescued more than 400 trekkers, including 216 foreigners, from the high altitude districts of Mustang, Manang, Myagdi and Dolpa that were hit by blizzards and avalanches. More than 45 choppers were mobilised over four days to rescue the stranded trekkers.

These two incidents could industry which has been struggling to attain the long-held target of bringing in a million tourists annually. Analysts argue the incident could damage the reputation of the country’s tourism industry that started picking up since 2011, after the Maoist insurgency deterred potential tourist growth for a decade.

“Obviously, the chain of misfortunes do not augur well for the growth of tourism,” says Prof Hari Sarmah, CEO of Nepal Association of Tour and Travel Agents. “These incidents call for an immediate need for investing on advanced climate technologies to ensure safety of trekkers and mountaineers in Nepal.”

Tourism entrepreneurs are upbeat of late, because of growth in the number of tourist arrival. Hoteliers are on an expansion spree, adding to the existing inventory or constructing new properties, in view of the improved scenario. The government has also launched an ambitious Vision 2020 campaign to boost the number of annual tourist arrival to two million. All these expectations could take a hit if a prompt action is not taken to address the safety issue of trekkers and mountaineers, says Sarmah.

The Trekking Agencies Association of Nepal (Taan) has blamed the “policy lapses” of the government for the disaster in the Annapurna region. Taan President Ramesh Dhamala says they had proposed the government several times to monitor trekking guides, enforce one-trekker one-guide policy, set up four porter shelters along the Annapurna circuit and training manpower serving in the high-altitude regions. None of the suggestions were heeded, claims Dhamala.

“Snowfall and strong winds are normal in the high-altitude regions, but the questions is what precautions measures should be applied to prevent accident. Guides are not properly trained and many lacks safety ideas on how to response on such situations. Even trekkers are found trekking the areas wearing sandals.”

The Annapurna region witnessed unseasonal snowfall and high wind, which arose from Cyclone Hudhud in south eastern part of India, but the guides were apparently forced to continue their ascent to 4,540m Thorong Phedi despite the inclement weather. Many trekkers choose to spend the night in Thorong Phedi before attempting to trek across Thorong La pass. “Had there been a porter shelter in the areas, we wouldn’t be dealing with high number of casualties,” says Dhamala.

He believes that the accidents in Manang and Mustang districts were due to negligence of untrained guides who did not know how to deal with the situation. “We can do nothing about avalanches, but casualty from blizzard could have been prevented.”

There are three major trekking routes in the Annapurna region--the Jomson trek to Jomsom and Muktinath, the Annapurna sanctuary route to Annapurna base camp, and the Annapurna circuit which circles the Annapurna itself and includes the Jomsom route.

According to Pramod Nepal, under-secretary at the Tourism Ministry, many trekkers were found buried under snow and some were seen rushing to Thorong Phedi as they thought it might be safe reaching there.

While experts suggest that the government should invest on advanced weather forecast technologies, Taan has called for enforcing no trekking without guide policy without any delay.

Taan has been lobbying for the policy since a long time to ensure safety of trekkers and generate employment. Dhamala says about 85 percent of the trekkers in Annapurna circuit were not assisted by guides. Keeping in mind the safety and security of trekkers, the Tourism Ministry on Monday decided to implement various safety measures, including strengthening Trekkers Information Management System, introducing trekking insurance policy, disseminating weather reports for trekkers and making compulsory of communication equipment.

The government also plans to construct shades and tents at an interval of every 60 minutes walking distance along the trekking routes for emergency, set up search and rescue fund, introduce trekkers tracking system and encourage trekkers to take enough clothes, foods and equipment. The Tourism Ministry records show that 113,213 trekkers visited the Annapurna region last year while the Everest region received 36,750 visitors.

Chinese co bags contract to expand Bhairahawa airport

2014-10-11T02:59:00.002-07:00

SANGAM PRASAIN
KATHMANDU, OCT 11 - China’s Northwest Civil Aviation Airport Construction Group has bagged the contract to upgrade Gautam Buddha Airport in Bhairahawa into a regional international airport.

The company emerged as the lowest bidder during the final review of the financial documents okayed by the Asian Development Bank (ADB), the major financer of the project. Northwest had quoted a price tag of Rs 5.50 billion, which is Rs 897.35 million less than the price quoted by the second lowest bidder.

The aggregate cost of the project as set by its executing agency the Civil Aviation Authority of Nepal (Caan) is Rs 6.30 billion. The planned airport will have a 3,000-metre runway and have a capacity to serve 760,000 passengers annually after the completion of its first phase.

The scope of works involves the construction of a new runway, exit and parallel taxiways with flexible pavements, new international aircraft parking apron with rigid pavements, rehabilitation of the existing runway for conversion into parallel taxiway, drainage system parallel to the runway, taxiway and diversion of the Ghaghara Khola and airport boundary, among others.

China Harbour Engineering Company and a Nepali-Spanish joint venture Sanjose-Kalika were the second and third lowest bidders, quoting Rs 6.40 billion and Rs 6.68 billion respectively.

Likewise, the other short listed firms are China Overseas Engineering Group, China’s Sinohydro Corporation and Spain’s Isolux-Corsan which had quoted Rs 6.77 billion, Rs 7.20 billion and Rs 7.21 billion respectively.

Of the seven firms, the financial bid submitted by China Volant Industry was rejected. On February 26, Caan had received seven confirmed bids from among the 37 firms that obtained bid documents.

“We have notified the lowest bidder China’s Northwest to be present within 28 days with a bank guarantee to sign a project contract agreement,” said Murari Bhandari, chief of the project.

“There will be negotiations with the company regarding its work schedule and other technical issues before signing the project contract,” he said, adding that after receiving the “commitment of works” for the company, Caan would give the go-ahead to begin the construction.

Considering the contract agreement and the company’s mobilization period, the construction work is likely to begin by the end of December.

“We have targeted to bring the airport into operation by early 2018,” Bhandari said.

The airport in Bhairahawa which is being upgraded into a regional international airport is the gateway to Lumbini, the birthplace of the Buddha. Of the total project cost, ADB will provide $ 58.50 million ($ 42.75 in loans and $ 15.75 million in grants), the OPEC Fund for International Development (OFID) will give $ 15 million loan and Caan will bear the rest as counterpart funding.

In the second phase which will commence after 10 years, the airport is projected to handle up to 2 million passengers.

After the airport is complete, it will be able to handle up to 6 million passengers annually. The airport will have six international parking bays.

The airport has been touted as one of the most viable projects due to its potential to draw a large number of Buddhist pilgrims to Lumbini.

It will also serve as an alternative to Kathmandu’s Tribhuvan International Airport (TIA) which is under strain due to heavy traffic.

Rs 8b high-rise hotel coming up in Kantipath

2014-10-11T02:57:00.001-07:00

SANGAM PRASAIN
KATHMANDU, OCT 11 - Kathmandu will soon have a new five-star hotel, the Sheraton Kathmandu Hotel. The ground-breaking ceremony for the Rs 8 billion, 17-storey luxury property, located in the heart of the city’s posh district, is slated to be held on Saturday.

The promoter MIT Group Holdings Nepal, a member of the Ghale group of companies which has diverse operations in Australia and other countries, said that Prime Minister Sushil Koirala was scheduled to lay the foundation stone of the project.

The Sheraton Kathmandu Hotel will be located on Kantipath adjacent to the office of Keshar Library, opposite the west gate of the Narayanhiti Palace Museum. The hotel, which is due to open in February 2018, will be spread over 14 ropanis of land.

US-based Starwood Hotels and Resort Worldwide Inc, one of the world’s largest hotel companies that owns, operates, franchises and manages hotels and resorts, will manage the hotel under its Sheraton brand. The MIT Group had signed an agreement with Starwood last year.

The new hotel will offer 218 suites and guest rooms, a health club, spa and retail outlets and provide 450 new jobs. It will also feature a 1,000-seat conference hall which will be the biggest hall in Kathmandu, the group claimed. In addition, there will be two conference rooms, three meeting rooms and a board room.

“We expect that Nepal will see improved business activities and economic growth in the days ahead that has encouraged us to invest in the hospitality sector,” said Shesh Ghale, an Australian-based Nepali millionaire and owner of the project.

As round-the-year occupancy of Nepal’s five-star hotels remains a big concern, Ghale said that an improved business environment was also likely to put Nepal on the map of quality tourist destinations. The Tourism Ministry’s statistics show that Nepal’s five-star hotels encountered a glut of rooms in 2013 due to a proliferation of new accommodation ranging from guest houses to home stays which pulled away potential customers from luxury properties.

The five-star hotels achieved an average occupancy of 58.85 percent last year, down from 62.76 percent in the previous year. Out of the 678,535 room nights produced last year, only 399,318 were occupied. There are 10 five-star properties in Nepal, eight of them in Kathmandu and two in Pokhara. An average hotel occupancy rate of 60 percent or below is considered to be very worrisome for the industry.

Meanwhile, the MIT Group is also holding negotiations with International Finance Corporation (IFC), the private sector lending arm of the World Bank Group, to mobilize capital for the project.

Ghale, who is also an incumbent president of the Non-Resident Nepali Association (NRNA), said that talks with IFC were going on but that it had not been finalized whether the group would utilize IFC capital. The project’s payback period is 15 years from the date of its formal opening.

The Sheraton Kathmandu Hotel marks the re-entry of the Sheraton brand in Nepal. It had earlier managed the Hotel Everest as the Hotel Everest Sheraton in the 1980s. After the Hyatt Regency, no other international hotel chain has come to Nepal. With domestic and inter-regional tourism aiding hotel demand, a range of leading global hotel chains have planned their presence in Nepal.

The Everest Hospitality Group, a subsidiary of the MS Group, had formally begun work to construct a 221-room five-star deluxe hotel in Nag Pokhari, Naxal under the banner of Marriott International, a leading hotel chain based in Maryland, US.

The group claimed that the proposed hotel would be the first five-star deluxe hotel in Nepal after its completion. The MS Group is currently constructing a four-star hotel in Thamel named the Fairfield. The 10-storey hotel will have 108 rooms and will be spread over two and a half ropanis.

Govt not to issue new paragliding permits

2014-09-19T00:26:00.002-07:00

SANGAM PRASAIN
KATHMANDU, SEP 19 - As the number of paragliding flights has reached a saturation point making the airspace in Pokhara congested and unsafe, the Tourism Ministry has decided not to issue new operating permits.

The decision, taken by a recent secretary-level meeting, came into effect from Wednesday.

There are around 19 paragliding companies operating in Pokhara, while more than 35 have applied for the operating permits.

New permits have been restricted in Sarangkot, Toripani and Mandredhunga, including areas covered by the air traffic service route of Pokhara airport and its control zone within 10 nautical miles radius, the Tourism Ministry said. “The decision to stop issuing operating permits is aimed at ensuring safety,” said Suresh Acharya, joint-secretary at the ministry. However, applications submitted until August 28 seeking technical suggestions from the Civil Aviation Authority of Nepal (Caan) will be considered in line with the recommendation of the authority. While for new companies, other alternative areas will be explored, the ministry said.

The ministry has formed a committee under the chief of Pokhara airport to regularly monitor paragliding companies. The committee has been asked to send their monitoring report to the ministry every three months.

In a bid to make the adventure sports safer, the ministry has also directed the district police office to set up a police post at every landing site. It has directed the Air Sports Association to arrange an ambulance at each such site.

Aerial sports began in Nepal in 1996 with Sunrise Balloon and Avia Club offering hot air ballooning and ultra light flying, respectively. Paragliding started to take off in 2007. Caan charges $1,280 (excluding taxes) to issue an Air Operators Certificate and $56.50 per flier as flight permission fee. The permit is valid for 15 days. Popular season for this adventure sport among thrill seekers is September-November. However, operators said paragliding is becoming popular as an all-season activity among the visitors.

A paragliding company handles 2,500-3,000 fliers annually, and 60 percent of them are foreign visitors. One company is allowed to operate six-seven flights per day depending on the weather. More than 90 flights are conducted on Sarangkot-Toripani-Dhikikhola, which is the busiest route.

Bad weather forces carriers to cancel one-third of flights

2014-09-19T00:25:00.002-07:00

SANGAM PRASAIN
KATHMANDU, SEP 18 - Domestic carriers were forced to cancel one-third of their scheduled flights last year because of heavy rain, high winds or blinding fog, the Ministry of Culture, Tourism and Civil Aviation said.

Airlines cancelled 12,675 flights, most of them due to bad weather conditions, which led to losses in the millions. Of the 39,128 scheduled flights, only 26,453 took off.

Airlines said that last year was one of their worst years as that was also when the European Commission put Nepal in the European Union air safety list.

Buddha Air cancelled one-fourth of its flights. It cancelled 4,750 of its 12,110 scheduled flights. Its close competitor Yeti Airlines conducted 9,092 flights, while it cancelled 3,296 flights. Yeti’s subsidiary Tara Air cancelled 2,453 flights and operated 3,501 flights last year.

Likewise, Simrik Airlines operated 2,439 flights and cancelled 1,338 flights. Nepal Airlines and Sita Air had grounded 515 and 322 flights respectively last year, according to the statistics.

Operators estimate that cancellation of a long-haul flight causes a loss of Rs 300,000 to Rs 400,000 depending on the number of passengers. On an average, a 19-seater aircraft earns $ 3,000 from a round trip on the Kathmandu -Lukla sector, the most lucrative flight for domestic carriers.

“The period December to February is a bad time for all domestic carriers as they are forced to make a huge number of cancellations and delays due to adverse weather conditions,” said Rupesh Joshi, senior executive of Buddha Air.

“Obviously, last winter was the most painful for airlines,” he said, adding that Biratnagar and Dhangadhi airports were closed for 10 consecutive days due to a cold wave.

According to him, a 50 percent flight cancellation per month means a loss of around Rs 80 million for Buddha Air. “In the Tarai, airport visibility normally drops to zero due to cold waves, and there is nothing that can be done about such climatic behaviour.”

Airlines said that flights were cancelled in the monsoon too. Sometimes, a scheduled flight will not take off if there aren’t enough passengers.

Tri Ratna Manandhar, former director general of the Civil Aviation Authority of Nepal (Caan), said that flight cancellations and delays were not a new problem in Nepal given the climatic variability and difficult terrain.

He added that installing advanced navigation systems at airports could reduce such cancellations, but that was not commercially viable as the equipment is expensive and difficult to maintain. “If instrumental landing system (ILS) is installed in airports, aircraft can land even in zero visibility.”

ILS is a ground-based instrument approach system that provides precise guidance to aircraft during its approach and landing using a combination of radio signals and, in many cases, high-intensity lighting arrays to enable a safe landing in reduced visibility due to fog, rain or blowing snow.

Manandhar said that a combination of factors like EC’s black listing of Nepali carriers, high airfares and weather problems had affected profits of domestic airlines.

Domestic air passenger movement dropped 7.76 percent in the first three months of 2014. The 14 domestic airlines, including helicopter operator, flew 332,853 passengers in the first quarter, 28,017 less compared to the same period a year ago, said Tribhuvan International Airport (TIA).

Nepali outbound surges, Thailand top destination

2014-09-19T00:24:00.003-07:00

SANGAM PRASAIN
KATHMANDU, SEP 19 - Travel agencies selling outbound tour packages have reported a surge in bookings pointing to a rebound from last year’s slump thanks to rising disposable incomes among Nepalis.

October-November not only sees a notable growth in inbound tourism but also a large number of Nepalis going on vacation, taking advantage of the festival season and winter holidays, with Thailand being the most popular overseas destination.

Travel agencies said that they were optimistic that demand for overseas trips would increase significantly this year, despite a weakening Nepali rupee against the US dollar.

Last year, a combination of factors like the Nepali rupee sinking to a record low of Rs 110 per dollar during the prime booking season and political tensions in a number

of East Asian destinations particularly Thailand had induced a negative growth momentum in outbound travel.

Travel agencies said that the outbound market had been corrected this year and that they expected good business. There are more than two dozen travel agencies dealing in outbound packages nowadays.

“We have received confirmed bookings from 150 people for the September-October period and are processing around 100 overseas trips,” said Neeli Shah, outbound marketing executive of Natraj Tours & Travels. “We expect more than 400 vacationers this year in contrast to the 120 people in 2013,” Shah said.

As Thailand and Malaysia continue to remain among the most preferred destinations, a growing number of Nepali travellers have been diversifying their destinations and planning trips to Dubai, Manila, China, Singapore, Turkey and Bali.

More than 60 percent of the travellers go to Thailand due to its competitively priced packages. The cost excluding airfare and visa fee starts from $ 150 per person for a four-night, five-day package.

According to Natraj Tours, a three-night, four-day package to Dubai costs $ 750 including airfare. It has launched a promotional three-night, four-day package to Bali that costs $ 185 per person excluding airfare.

“In a bid to attract more customers to go on overseas trips, we have also launched cruise destinations particularly in Singapore and Dubai, and there have been more than 20 confirmed booking for this segment,” Shah added.

Meanwhile, Suman Lal Shrestha, CEO of Hamro Holidays, said there had been an increasing trend of Nepali fun seekers from middle and lower middle income groups travelling abroad.

“The current overseas trip booking trend shows that there will be a significant number of people travelling to various holiday destinations during this Dashain and Tihar festivals,” Shrestha said. “We have received more than 300 confirmed bookings for this festival season and there are a significant number of inquiries.”

Shrestha said that Thailand was the first choice of Nepali travellers, while travel packages for European destinations are also getting popular nowadays.

According to him, a Thailand tour package including airfare starts from Rs 55,000 per person, an increase of almost Rs 5,000 over last year’s rate due to a hike in the airfare.

According to Tourism Ministry statistics, Nepali outbound dropped 17.57 percent to 32,369 departures in 2013. The outbound numbers were 39,269 in 2013 and 32,063 in 2011. In 2008, outbound amounted to 21,899 departures. Among the 983,357 Nepalis going abroad last year, vacationers made up 3.29 percent.

According to the Tourism Authority of Thailand (TAT), 25,455 Nepalis visited Thailand in 2013, down 3.12 percent. TAT’s stats show that the length of stay of Nepalis in Thailand averaged 8.87 days last year, up from 8.61 days in 2012, the highest among South Asian visitors.

Similarly, Nepalis spent $ 138.95 per day in Thailand last year against $ 133.12 per day in 2012. In total, Nepali outbound spent $ 31.80 million (Rs 3.11 billion) there. In the previous year, Nepalis total spending was recorded at $ 30.17 million (Rs 2.70 billion). A larger portion of Nepali spending went into shopping and accommodation.