House panel to probe Airbus purchase deal

Friday, September 28th, 2018 | | Money

The Parliamentary Public Accounts Committee (PAC) has decided to investigate the purchase of two wide-body aircraft by Nepal Airlines Corporation (NAC).

The committee’s decision comes after many lawmakers insisted reports of funds embezzled in the purchase of two new aircraft for the national carrier.

The airline management is under scrutiny for not

following due purchase procedure. A major issue concerns the airline receiving planes with lesser load carrying capacity that infringes the figure mentioned in the tender notice.

PAC Chairperson Bharat Shah said, “We will discuss the wide-body aircraft purchase process and other issues with the Auditor General at a meeting on Friday.”

The committee meeting would decide whether to proceed with the investigation of aircraft purchase deal or drop it after checking all documents and the Auditor General’s comments, Shah said.

The NAC purchased two A330-200 Airbus aircraft from the US-based AAR Corp for $209.6 million, the largest ever aircraft purchase deal in Nepal’s aviation history.

First of the two wide-body aircraft—Annapurna arrived at the Tribhuvan International Airport in the last week of June. The second named Makalu arrived a month later, in the last week of July.

The irregularities in the deal came out in public after the Office of Auditor General’s 55th Annual Report revealed the NAC bought two aircraft without following due legal procedure.

According to the OAG report, the national carrier used an agent to purchase the planes and called for a global tender instead of bidding a tender from the aircraft manufacturing company. Despite the NAC’s contacts with Airbus – it had purchased two new narrow-body aircraft in 2015 – the NAC did not seek price order from Airbus in the new deal for wide-body aircraft.

Following the OAG report, the Ministry of Tourism, Culture and Civil Aviation formed a committee, under the coordination of Buddhi Sagar Lamichhane, who was among the NAC board of directors when the corporation signed the aircraft purchase agreement.

Earlier, Ministry Joint-Secretary Suresh Acharya was the co-ordinator of the committee. He was member of the NAC board of directors for one year.

The Commission for Investigation of Abuse of Authority (CIAA) has also launched an investigation into the wide-body aircraft purchase.

Several lawmakers including Hridayesh Tripati, Birodh Khatiwada, Rajendra Kumar KC, Prem Bahadur Ale, Pushpa Kumari Karna Kayastha and Dharma Shila Chapagain have demanded a thorough probe on the irregularities in purchase of aircraft, arrears in other sector and the construction of the fast-track.

Many MPs stressed on scrutinizing unpaid arrears mentioned in the OAG report and direct concerned officials to recover the dues.

The OAG has prepared a report pointing misappropriation of funds in the process of purchasing the two wide-body aircraft.