Five stored Chinese-manufactured aircraft remain at Nepal Airlines (RA, Kathmandu) after campaigns to sell or lease them failed, according to the Kathmandu Post. The two MA-60s and three Y12s have been unused since 2020 and are “rotting away” at Kathmandu Airport.
“Both options, leasing and selling the aircraft, have failed,” an airline spokesperson told the newspaper. “We have sought suggestions from the ministry on what to do next. It’s been months since we asked for their guidance.”
Reportedly, Nepal’s minister of civil aviation, Badri Pandey, has told the Nepal Airlines Corporation board to decide what to do with the aircraft, but the board is yet to discuss the issue. The airline parked the aircraft in 2020 due to their high operating costs. However, while parked, Nepal Airlines has continued to pay the operators of Kathmandu’s Tribhuvan International Airport parking fees and other charges.
Two attempts to lease some or all of the aircraft in 2022 failed. In 2023, a US company valued the five aircraft at NPR220 million Nepalese rupees (USD1.6 million) in preparation for a sales campaign. Nepal Airlines felt that the valuation was too low and set a floor price of USD19.6 million for the aircraft. They failed to sell.
The Chinese government supplied the aircraft via the state-owned Aviation Industry Corporation of China (AVIC) and a series of grants and soft loans totalling NPR6.66 billion (USD48 million). The same government has since pressured Nepal not to offload the aircraft, lest it send the wrong message about them.
A seven-year holiday on principal and interest repayments ended in 2021. Neither Nepal Airlines nor the Nepalese government have made any payments and the Chinese have not asked them to do so. Nepal Airlines owes assorted creditors and lenders approximately NPR50 billion (USD360 million).
Meanwhile, in what is a semi-regular event, the Civil Aviation Authority of Nepal (CAAN) has publicly named seven non-operational airlines and asked them to pay their bills or risk a ban from working in the aviation industry in the future. The government aviation agency and safety regular is owed NPR91.6 million (USD660,000) by the seven entities, including NPR47.22 million (USD340,000) from Necon Air; NPR5.55 million (USD40,000) from Shivani Air; NPR2.03 million (USD14,600) from Gorkha Airlines; NPR6.1 million (USD43,900) from Mountain Air (Nepal); NPR34.7 million (USD250,000) from Cosmic Air; NPR7.8 million (USD56,200) from Skyline Airways; and NPR7.38 million (USD53,200) from Air Kasthamandap.