Tourism Min wants to take over stalled SIA

The Tourism Ministry has said that it will take ownership and control of the second international airport (SIA) project in Nijgadh as Investment Board Nepal has been sitting on the proposal for the past two years.

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 Tribhuvan International Airport, the country’s sole aerial gateway.

The multi-million dollar project had been assigned to Investment Board Nepal with a mandate to fast-track it under a single window. However, the board put it on the back burner.

Tourism Minister Bhim Acharya said they would bring the project back to the Tourism Ministry’s ownership as there has been no sign of progress in the country’s dream project under the board. “We have decided to take control of the project’s detailed feasibility study report which has been lying idle at the BOOT committee of the National Planning Commission,” Acharya said. “We will invite potential bidders for the project after we get the study report back.”  However, board officials say that none of the ministries can take away the project from the board as the current Investment Board Act forbids doing so.

“There might be interest of some ministries to snatch the projects from us, but it will be difficult legally for them,” said a senior board official. Earlier,  Ministry of Physical Infrastru-cture and Transport had snatched Kathmandu -Terai Fast Track but board officials say that the road project had never come under the board fully as the cabinet had not decided for bringing that project under board despite the board’s decision.

In April 2012, Korea’s Landmark Worldwide Company had submitted the study report to the Tourism Ministry. The company has spent US$ 3.55 million on the detailed and design feasibility study. The government had awarded the contract to Landmark on March 8, 2010.

Since the board had been repeatedly asking the Tourism Ministry for the study report, the ministry had told the Khil Raj Regmi-led administration four months ago that if the board wanted the report, it should be ready to pay its cost. But the Cabinet returned the proposal.

“It has been more than one and a half years since the report was submitted to the BOOT committee, but no decision has been made on the project,” said Ranjan Krishna Aryal, joint secretary at the ministry. “The Cabinet has also sent back the proposal. In this scenario, the project has been in complete limbo.”

Although lack of coordination between the National Planning Commission, Investment Board and the Tourism Ministry has been blamed for the project’s being at a standstill, it wasn’t going anywhere even before the board was formed. While the ministry was in favour of handing over the project to Landmark, the commission and the government wanted to go for open bidding.

The ministry had even told the commission that projects costing more than Rs 2 billion could be awarded directly to any investor without calling for a request for proposal (RFP) under Section 9 of the BOOT Act. 

Although the ministry had also recommended inviting RFPs, the proposal was intended more to assist Landmark secure the contract as it had been showing an interest in constructing the airport since 2007. The ministry had also pledged to give due priority to the Korean company before it was selected to do a detailed feasibility study. As per Landmark’s feasibility study, the proposed airport would 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 US$ 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. The airport would have a three-storied terminal building with the latest systems and highly intelligent security equipment. The study has stated that a Kathmandu -Tarai fast track should be completed at least six months before the start of the airport’s commercial operation.

source: the kathmandu post,9 april 2014