International Finance Corporation (IFC), a member of the World Bank Group is likely to be appointed as the transaction advisory service provider by the Nepal government for under construction Gautam Buddha International Airport (GBIA) of Bhairahawa.
IFC has presented a proposal conveying interest to support in preparing tender documents, publishing a notice on the related tender and go for appropriate private party to operate the airport to the government for the construction project of Bhairahawa airport.
According to Mr. Pradip Adhikari, Director at the Civil Aviation Authority of Nepal (CAAN), the proposal sent by IFC has been forwarded to Ministry of Culture, Tourism and Civil Aviation (MoCTCA) for approval. After the approval, it will be sent to the Ministry of Finance (MoF) for the final agreement. CAAN will sign a financial advisory service agreement with IFC following the approval from MoCTCA and MoF.
IFC has been working with Nepal’s private sector to boost private sector growth by promoting investments in hydropower, infrastructure, tourism and financial markets since 2008. Moreover, IFC has made a great contribution for Nepal’s growth, including agribusiness, transportation, trade finance, small businesses, and private equity and venture funds by working directly with the Government of Nepal in making it easier to do business in the country.
MoCTCA has shown optimistic feedback on the subject of handover operational responsibility to public-private partnership (PPP) of Bhairahawa Airport. In the case of selection of PPP, PPP will be responsible for operation of the airport excluding air traffic control, security, customs, and immigration.
NPC also requested the government to identify risks and profit of the project, responsibility of the private sector, operating law for national and international airport, quality assurance and safety and security at the airport before inducting private investment.
The government has reached the point of selecting PPP model after considering the situation of Tribhuvan International Airport (TIA).
50 percent physical progress has been achieved in Bhairahawa airport construction work. The construction project of Bhairahawa airport will be completed by June 2019.
The construction works had begun in 2015 with an objective of completing the work in two years. The project, however, was delayed due to various problems including the negligence of Contractor Company, disputes over compensation distribution, political protests and shortage of construction materials.