Public-private partnership proposed for NAC

The Nepal Airlines Corporation (NAC) Tuesday proposed to sell its shares to private parties under a public-private partnership (PPP) system in a bid to avoid further distress to the national flag carrier.

The meeting of the board of directors took the decision and is forwarding it to the Ministry of Culture, Tourism and Civil Aviation soon for approval, said a board director who attended the meeting.

NAC would need a green signal from the cabinet to convert the institution into a company from a corporation and induct the private parties under PPP.

“To clear the way for PPP, we also decided to conduct a valuation,” the director said. “Even after becoming a company, the airline will still hold the status of the national flag carrier.”

The government, in last year’s budget speech, had also announced to run NAC under the concept of PPP.

After the corporation performed badly, successive governments have said they would convert it into PPP to inject new life into it. But, the plans have remained largely unimplemented. This is the first time that the NAC board formally decided in favor of a PPP.

Due to the management’s negligence and alleged ‘scouting for commission’, it failed to maintain the scheduled operations of its two international aircrafts. It relied on a single Boeing aircraft for a year for all international flights as the other aircraft remained grounded due to damage to its engine.

The management did not repair a spare engine that it owned and left it lying idle in Hong Kong for years, inviting the trouble. As a result, the airline has been losing credibility fast as it has been repeatedly been failing to maintain its flight schedules.

The director said the ministry must immediately initiate efforts to materialize the concept if it wishes to save the corporation from bleeding further.

Analysts said the best way out of the current mess would be to scout a strong international airline as a strategic partner as the Sri Lankan Airlines did with the Emirates Airways.
Source: eKantipur