Dispute in the loan agreement for Pokhara International Airport

Dispute in the loan agreement for Pokhara International Airport

19 Apr 2016 – Sumesh Shrestha – The dream of Pokhreli faces a major problem in coming to reality as there raises the issue of dispute between Nepal Government and Civil Aviation Authority of Nepal regarding the process of arranging loan for the budget of construction of the Pokhara Regional International Airport. With this the construction which boosted in a new way after the laying of foundation stone by Prime Minister K.P. Sharma Woli on the first day of New Year is turned towards darkness.

The dispute between Ministry of Finance and Civil Aviation puts the future of construction into a wrong turn. 25% of the amount of the loan of Rupees 210 Million provided by China needn’t to be paid the interest and the rest of the amount would be liable of 2% interest as per the agreement of the Chinese Authorities and Nepal Government. However the Government wants Civil Aviation which will utilize this amount to pay an interest of 8% to the government and hence Civil Aviation which is not in agreement with this creates a trouble in the loan agreement between Civil Aviation and Nepal Government.

Nepal Government wants the interest to be paid according to the value of the US Dollars so that the increment in the value of USD will not cause any loss to Nepal Government. A source from Civil Aviation informs that they are unsatisfied with the proposal of imposing interest in the amount that has been granted with no interest to the Government. And also added that they will be able to pay a maximum of 5% interest to the amount the Nepal Government received in a 2% interest rate from China excluding the 25% of the loan that was granted without any interest charge.

An official from Ministry of Finance told the amount can be sanctioned to Civil Aviation only after they agree to make a secondary agreement with Nepal Government. He said that the Government hurried for the laying of foundation stone without making the proper agreement of the loan with Civil Aviation that causes the trouble in fixing the issue now. He also informed that the agreement process can be resolved within a week if they work together in the solution of the problem.

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