SANGAM PRASAIN
KATHMANDU, FEB 23 -
The Nepal Oil Corporation (NOC) has proposed the Ministry of Supplies revise the existing price of petroleum products in line with the international market price International fuel price soared to a whooping $106 a barrel on Tuesday following the Libyan uprising.
The corporation has proposed Rs 10.73 per litre hike in petrol rate and Rs 17. 24 per litre increase in aviation turbine fuel (ATF) rate, saying that the existing price would inflate its losses and induce short supply.
The corporation said only an immediate price hike could ensure smooth supply, as the existing price would compel it to cut down gasoline import. According to NOC sources, the corporation had curtailed gasoline import by 25 percent on Monday. With the current international price, increased import means increased losses for NOC.
The state-owned oil monopoly has also proposed the government to waive taxes on diesel and LP gas until the international price drops. It has also proposed the government to adjust the petrol price in line with Raxaul price and ATF price in line with Kolkata price. Petrol price in Raxaul is Rs 97.23 per litre, while ATF costs Rs 97.24 per litre in Kolkata, according to the corporation.
The NOC has estimated its February losses at Rs 1.13 billion. The corporation said it is incurring a loss of Rs 5.59 per litre in petrol and enjoying a profit of Rs 11.43 per litre in ATF.
Currently, consumers are paying Rs 88 per litre for petrol and Rs 68.50 per litre for diesel and kerosene. Normally, the country consumes 15,000 kilo litre (kl) of petrol and 70,000 kl of diesel every month. However, according to NOC, in the first half of February, it imported 9,000 kl of petrol and 39,000 kl of diesel, much higher than the normal consumption. NOC General Manager Digambar Jha fears that the significant rise in gasoline consumption could result in severe fuel shortage. As per the current rate, petrol and diesel import could reach 18,000 kl and 80,000 kl per month, respectively.
“We have proposed the price revision to ensure smooth supply,” said Jha, adding that increased load-shedding hours have also increased gasoline demand. If the government will not be serious in this issue, there may be a severe fuel shortage soon.
The NOC on Dec 6, 2010 had hiked the prices of major petroleum products, making petrol, diesel and kerosene each dearer by Rs 3 per litre and LP gas by 75 per cylinder.
Tuesday, February 22, 2011
Monday, February 21, 2011
Healthy bookings for coming tourist season
SANGAM PRASAIN
KATHMANDU, FEB 21 -
International airlines and hotels have reported healthy bookings for the coming peak tourist season. March, April and May attract adventure and leisure tourists to Nepal.
Hoteliers are expecting a 10 percent higher occupancy rate this season compared to the same period in 2010. "We are hopeful that our occupancy will cross 80 percent," said Raju Bikram Shah, general manager of the Hotel Shangri-La. Hotel bookings by Indian travellers have been high for March compared to last year, Shah added.
"Airline booking statistics from the major gateways connecting Nepal— Delhi, Bangkok, Abu Dhabi, Doha and Bahrain— show strong inbound bookings beginning from the first week of March,” said Shyam Raj Thapaliya, managing director of Osho World Travel Nepal.
A recent study done by Nielsen Company in association with the Pacific Asia Travel Association (PATA) shows that Indian arrivals to Nepal have remained constant since 2008. Nepal occupied the fifth place for Indian leisure travellers after Singapore, Malaysia, Dubai, Thailand and Switzerland. The Nepal Tourism Year campaign has targeted 265,000 Indian travellers this year. “Following Indians, bookings by Korean, Italian, French and Chinese travellers have also shown a positive indication this season,” Shah said.
“Considering the current booking trend, we are hopeful that occupancy will cross 80 percent in March and be higher in April,” said Bharat Joshi, sales and marketing director of the Hotel Yak & Yeti. “The UN, embassies, INGOs and other international agencies have been taking the initiative to promote Nepal in recent times.” These international agencies have been recommending Nepal as the perfect place for MICE activities which has resulted in hotels seeing a rise in the MICE segment.
The government has also announced Rs 500,000 incentive to any organiser holding MICE programme involving more than 100 foreign passport holders entering Nepal through air route. The incentive will be provided within seven days of the completion of such programme upon submission of evidence and relevant documents.
The Soaltee Hotel has targeted to increase room occupancy by 8-10 percent this season, said the hotel.
However, mountaineering agencies said that bookings for expeditions had not picked up as expected this season. “Travellers now have lots of options. The mountains in India, Pakistan and China are attracting aspirant mountaineers,” said Ang Tshering Sherpa, former president of the Nepal Mountaineering Association.
Although the government has announced different schemes to attract mountaineers particularly to Western Nepal, lack of transportation and infrastructure has kept the sector isolated. “The reason behind the slow bookings can also be attributed to the cost of climbing peaks in Nepal which is lower in neighbouring countries,” Sherpa said.
Tourist arrivals have bounced back in 2010 breaking all past records. Arrivals by air in 2010 reached 448,769 surpassing the highest ever of 421,243 in 1999.
KATHMANDU, FEB 21 -
International airlines and hotels have reported healthy bookings for the coming peak tourist season. March, April and May attract adventure and leisure tourists to Nepal.
Hoteliers are expecting a 10 percent higher occupancy rate this season compared to the same period in 2010. "We are hopeful that our occupancy will cross 80 percent," said Raju Bikram Shah, general manager of the Hotel Shangri-La. Hotel bookings by Indian travellers have been high for March compared to last year, Shah added.
"Airline booking statistics from the major gateways connecting Nepal— Delhi, Bangkok, Abu Dhabi, Doha and Bahrain— show strong inbound bookings beginning from the first week of March,” said Shyam Raj Thapaliya, managing director of Osho World Travel Nepal.
A recent study done by Nielsen Company in association with the Pacific Asia Travel Association (PATA) shows that Indian arrivals to Nepal have remained constant since 2008. Nepal occupied the fifth place for Indian leisure travellers after Singapore, Malaysia, Dubai, Thailand and Switzerland. The Nepal Tourism Year campaign has targeted 265,000 Indian travellers this year. “Following Indians, bookings by Korean, Italian, French and Chinese travellers have also shown a positive indication this season,” Shah said.
“Considering the current booking trend, we are hopeful that occupancy will cross 80 percent in March and be higher in April,” said Bharat Joshi, sales and marketing director of the Hotel Yak & Yeti. “The UN, embassies, INGOs and other international agencies have been taking the initiative to promote Nepal in recent times.” These international agencies have been recommending Nepal as the perfect place for MICE activities which has resulted in hotels seeing a rise in the MICE segment.
The government has also announced Rs 500,000 incentive to any organiser holding MICE programme involving more than 100 foreign passport holders entering Nepal through air route. The incentive will be provided within seven days of the completion of such programme upon submission of evidence and relevant documents.
The Soaltee Hotel has targeted to increase room occupancy by 8-10 percent this season, said the hotel.
However, mountaineering agencies said that bookings for expeditions had not picked up as expected this season. “Travellers now have lots of options. The mountains in India, Pakistan and China are attracting aspirant mountaineers,” said Ang Tshering Sherpa, former president of the Nepal Mountaineering Association.
Although the government has announced different schemes to attract mountaineers particularly to Western Nepal, lack of transportation and infrastructure has kept the sector isolated. “The reason behind the slow bookings can also be attributed to the cost of climbing peaks in Nepal which is lower in neighbouring countries,” Sherpa said.
Tourist arrivals have bounced back in 2010 breaking all past records. Arrivals by air in 2010 reached 448,769 surpassing the highest ever of 421,243 in 1999.
Sunday, February 20, 2011
New casino guideline in offing
The gambling houses may have to put up collateral to obtain licence
SANGAM PRASAIN
KATHMANDU, FEB 21 -
Delay in paying royalty to the government could prove costly for casinos henceforth.
With Parliament’s Public Account Committee (PAC) instructing the government to come up with regulatory framework to regulate casinos, the Ministry of Tourism and Civil Aviation (MoTCA) has prepared a draft guidelines on casinos which says that casinos have to put up a collateral worth equivalent to the two years’ royalty while acquiring operating licence.As casinos were found to be reluctant in paying royalty and other dues to the government, the proposal of collateral was floated, said a ministry official. “The rationale behind the new provision is to ensure royalty compliance,” said a ministry official. “If a casino defaults on royalty payment, the government will seize its collateral.” Currently, casinos have to pay an annual royalty of Rs 20 million.
The guidelines, which are currently under discussion, say that the operating license can be renewed every two years. The government, through the budget, has made it mandatory for casinos to get their licences renewed every year. As per the Finance Bill, casinos failing to clear their royalties by mid-January will lose their licences. A gambling house that loses its licence will have to start afresh to obtain a new one.
The new guidelines also talk about allowing Nepali citizens in casinos. However, only big taxpayers (those having an annual turnover of Rs 250 million) will be allowed in casinos. The Department of Revenue Investigation will provide data of those big taxpayers. Casinos should issue memberships to these people, says the proposed guideline. However, they have to pay an entry fee of Rs 5,000 for 24 hours.
According to the draft guidelines, casino operators have to submit their detailed business and investment plan to the government to obtain licence. With most of the casinos relying on Nepali citizens, the guidelines say that casinos should come up with tourism packages to attract foreign clients. Casinos should register their infrastructure —from furniture to gaming machines at the ministry and should have ministry’s stickers pasted on them.
The ministry will supervise casinos every three months and will be entrusted with the whole job of monitoring them, according to the guideline. In order to regulate and enforce the guidelines, plain-cloth police personnel will also be mobilised in casinos. Hotels had been complaining that surprise police raids had terrified their clients.
The DRI had recommended the ministry to shut eight casinos failing to pay their royalty dues on time. The ministry has not been able to take a decision in this regard because of the delay in the Cabinet formation.
The DRI on Feb. 13 had dispatched a letter to the ministry asking it to shut down Casino Rad, Casino Venus, Casino Grand, Casino Royale, Casino Anna, Casino Shangri-La, Fulbari Casino and Casino Nepal after they failed to clear their outstanding royalties and dues within the 35-day deadline set by the department.
Of the 10 casinos currently operating in the country, only two—Casino Tara at Hotel Hyatt Regency and Casino Everest at Hotel Everest—have cleared their dues.
In a bid to regulate the casino business, PAC issued a series of directives to the government—from drafting a Casino Act and working procedure for casinos to amending the existing Gambling Act. PAC had directed the government on Dec. 28 to scrap operating licences of casinos that fail to clear their dues within 35 days. The DRI, based on PAC’s directive, had issued a strong notice to all the defaulting casinos asking them to either clear their dues or face cancellation of their operating licenses.
Following the PAC directives, five casinos—Casino Tara, Casino Rad, Casino Venus, Casino Grand and Casino Shangri-La—paid their royalties for the current fiscal year. However, except for Casino Tara, the other four have been recommended for action by the DRI. Three casinos—Casino Venus, Casino Rad and Casino Grand—have been recommended for action as they have not cleared their interest payment for the current fiscal year even though they paid the royalty for the current fiscal year.
According to the DRI, these eight casinos still owe Rs 355 million to the government. Despite constant pressure of revenue enforcement agencies, Casino Anna and Casino Nepal have not settled their dues. These two casinos owe Rs 244 million. Likewise, Casino Fulbari still has to pay Rs 62.1 million.
The government, for the last six months, has been tightening the screw against casinos after their repeated failure to clear royalties and dues. Continued defiance by casinos of government orders to clear their dues and bar Nepalis from entering their premises forced the government and PAC even to explore the possibility of moving them out of Kathmandu.
SANGAM PRASAIN
KATHMANDU, FEB 21 -
Delay in paying royalty to the government could prove costly for casinos henceforth.
With Parliament’s Public Account Committee (PAC) instructing the government to come up with regulatory framework to regulate casinos, the Ministry of Tourism and Civil Aviation (MoTCA) has prepared a draft guidelines on casinos which says that casinos have to put up a collateral worth equivalent to the two years’ royalty while acquiring operating licence.As casinos were found to be reluctant in paying royalty and other dues to the government, the proposal of collateral was floated, said a ministry official. “The rationale behind the new provision is to ensure royalty compliance,” said a ministry official. “If a casino defaults on royalty payment, the government will seize its collateral.” Currently, casinos have to pay an annual royalty of Rs 20 million.
The guidelines, which are currently under discussion, say that the operating license can be renewed every two years. The government, through the budget, has made it mandatory for casinos to get their licences renewed every year. As per the Finance Bill, casinos failing to clear their royalties by mid-January will lose their licences. A gambling house that loses its licence will have to start afresh to obtain a new one.
The new guidelines also talk about allowing Nepali citizens in casinos. However, only big taxpayers (those having an annual turnover of Rs 250 million) will be allowed in casinos. The Department of Revenue Investigation will provide data of those big taxpayers. Casinos should issue memberships to these people, says the proposed guideline. However, they have to pay an entry fee of Rs 5,000 for 24 hours.
According to the draft guidelines, casino operators have to submit their detailed business and investment plan to the government to obtain licence. With most of the casinos relying on Nepali citizens, the guidelines say that casinos should come up with tourism packages to attract foreign clients. Casinos should register their infrastructure —from furniture to gaming machines at the ministry and should have ministry’s stickers pasted on them.
The ministry will supervise casinos every three months and will be entrusted with the whole job of monitoring them, according to the guideline. In order to regulate and enforce the guidelines, plain-cloth police personnel will also be mobilised in casinos. Hotels had been complaining that surprise police raids had terrified their clients.
The DRI had recommended the ministry to shut eight casinos failing to pay their royalty dues on time. The ministry has not been able to take a decision in this regard because of the delay in the Cabinet formation.
The DRI on Feb. 13 had dispatched a letter to the ministry asking it to shut down Casino Rad, Casino Venus, Casino Grand, Casino Royale, Casino Anna, Casino Shangri-La, Fulbari Casino and Casino Nepal after they failed to clear their outstanding royalties and dues within the 35-day deadline set by the department.
Of the 10 casinos currently operating in the country, only two—Casino Tara at Hotel Hyatt Regency and Casino Everest at Hotel Everest—have cleared their dues.
In a bid to regulate the casino business, PAC issued a series of directives to the government—from drafting a Casino Act and working procedure for casinos to amending the existing Gambling Act. PAC had directed the government on Dec. 28 to scrap operating licences of casinos that fail to clear their dues within 35 days. The DRI, based on PAC’s directive, had issued a strong notice to all the defaulting casinos asking them to either clear their dues or face cancellation of their operating licenses.
Following the PAC directives, five casinos—Casino Tara, Casino Rad, Casino Venus, Casino Grand and Casino Shangri-La—paid their royalties for the current fiscal year. However, except for Casino Tara, the other four have been recommended for action by the DRI. Three casinos—Casino Venus, Casino Rad and Casino Grand—have been recommended for action as they have not cleared their interest payment for the current fiscal year even though they paid the royalty for the current fiscal year.
According to the DRI, these eight casinos still owe Rs 355 million to the government. Despite constant pressure of revenue enforcement agencies, Casino Anna and Casino Nepal have not settled their dues. These two casinos owe Rs 244 million. Likewise, Casino Fulbari still has to pay Rs 62.1 million.
The government, for the last six months, has been tightening the screw against casinos after their repeated failure to clear royalties and dues. Continued defiance by casinos of government orders to clear their dues and bar Nepalis from entering their premises forced the government and PAC even to explore the possibility of moving them out of Kathmandu.
Health is wealth
Hospitals and medical colleges are big investment opportunities for the private sector
SANGAM PRASAIN
KATHMANDU, FEB. 18
Nepali business houses have stayed away from investing in the health sector for many years. Presently, some of the leading names in Nepal's private sector, the Khetan Group, NE Group and Upendra Mahato, have announced plans to enter the health sector in a big way.
The private sector has a strong presence in the domestic health sector through medical institutions like Om Hospital, B&B Hospital, Medicare Hospital, Kathmandu Medical College and Manipal Medical College. However, the latest wave of investments from the private sector shows that health is now turning into an investment area for them.
The Chaudhary Group was perhaps the first business house in Nepal to make a foray into the health sector in an institutional way. The group established Norvic International Hospital (then known as Norvic Health Care and Research Centre) in 1994. It is now operating with 100 beds. Two leading private hospitals, Om Hospital and Medicare Hospital, were upgraded from nursing homes to hospitals.
The expansion and success of private hospitals in India, ever growing need of quality health service and poor performance of public sector health outlets has provided immense opportunities for the private sector. Khetan Group chairman Rajendra Khetan said, "There is a huge gap between demand and supply in domestic health service." Khetan thinks the domestic market is large enough for private players to survive and make profits.
Cash-rich Khetan Group is currently looking for land for its foray into the health sector. According to Rajendra Khetan, the group will invest Rs 3 billion in its health project that includes hospital, medical college and nursing college.
After investing in Medicare Hospital, Upendra Mahato, former president of the Non-Resident Nepali Association (NRNA), is now gearing up for yet another venture into health. Mahato is working to start a medical college and hospital in Kathmandu. The proposed Ashwini Medical College and Hospital is a Rs 7 billion project. The college will have 100 seats and has already received permission from the Ministry of Education. According to sources, the medical college will be affiliated to Tribhuvan University or Kathmandu University.
CE Construction in a tie-up with another company has invested in Grande International Hospital at Dhapasi, Kathmandu with 200 beds. The Rs 1.2 billion project will be completed by February 2012, according to Vijay Rajbhandary, chairman of CE Construction. "The hospital will be a multi-disciplinary one to cater to the growing needs of patients," said Rajbhandary. "The hospital will be expanded to 500 beds within a decade along with a medical college and nursing college."
Of late, foreign joint ventures are slowly making inroads into the Nepali health sector. Norvic Hospital has recently entered into an agreement with India’s Medanta Medicity, one of the leading hospitals in India, for technology transfer and expertise in the medical field. Super Religare Laboratories (SRL), one of India’s leading diagnostic networks, opened a Super Religare Reference Laboratories (Nepal) in a joint venture with the NE Group.
The laboratory is a partnership between SRL and Life Care Services, a subsidiary of the NE Group. Each has a 50 percent stake in Super Religare Reference Laboratories which has a total investment of Rs 50 million. SRL is the largest and most trusted pathology laboratory network in India, servicing nearly 4,000 hospitals/path labs and over 50,000 doctors.
This JV, according to Ravi Bhakta Shrestha, vice chairman of the NE Group, is now mulling opening a boutique hospital in Nepal. "We're currently under negotiation with Fortis Healthcare Limited, one of SRL's promoters," said Shrestha. Though it is still not decided about the equity structure, Shrestha says the NE Group is keen to invest up to 50 percent in this venture. The boutique hospital will have 100 beds with world class health services.
Norvic is also going for a big expansion drive with an investment of Rs 1 billion. Apart from expanding its existing hospital at Thapathali by adding 100 beds, it is establishing a medical college at Lubhu, Lalitpur. There will be a 100-bed community hospital at Lubhu that will provide health service at relatively cheaper prices.
With the public health service still not being effective despite the government pumping in billions of rupees, the private sector's entry into it is believed to make health services better, professional and reliable. However, there is also the question of affordability. Will the common people have access to these high-end medical facilities? Will they be able to get services? These are some pertinent questions.
Khetan believes that with an increase in supply, the cost of health services will drop. "There is a huge gap between demand and supply. If we can manage to increase supply, we'll have a higher turnover, which will eventually allow us to provide health services at affordable prices," says Khetan.
Health entrepreneurs say that if properly developed, Nepal can attract patients from India due to cheaper medical costs and agreeable climate.
Reaching for the sky
The economy may have slowed to a crawl, but Nepal's aviation sector is taking off
SANGAM PRASAIN
The economy may not be growing by leaps and bounds, but it hasn't stopped domestic airlines from expanding. The domestic aviation sector is seeing new companies entering the scene and carriers expanding their fleets and spreading their wings beyond Nepal's borders.
With the country celebrating 2011 as Nepal Tourism Year with the aim of bringing one million tourists, the bustle in the aviation sector is understandable. The latest entrant is Goma Air that has two single-engine Cessna Caravan aircraft in its fleet. There are now nine domestic airlines and five helicopter services operating in the country.
Domestic airlines have been eyeing international operations. Their success in the domestic arena has made them confident of starting international flights. Buddha Air, after establishing itself strongly in the domestic domain, started international operations last year.
With the national flag carrier Nepal Airlines Corporation in a state of perpetual stupor, five domestic airlines have been inspired to join hands to start international operations by establishing a new company. Buddha Air, Yeti Airlines, Guna Airlines, Agni Air and Simrik Air plan to start international operations by May 2011.
Another indication of the country's aviation sector taking off is the 62 percent surge in domestic passenger movement and 36 percent rise in aircraft movement in the last 10 years (2000-09).
Remote areas: Next business prospect
Difficult geographical terrain and lack of roads in many parts of the country have provided the aviation sector huge business prospects. Single-engine aircraft are back in Nepal's skies. Many aviation entrepreneurs say the next big business for domestic aviation would be remote areas. Buddha Air's managing director Birendra Basnet is one of them. "The next big business scope for domestic airlines is remote areas," said Basnet. "As this sector is less competitive and the cost of operation is also less, there is profitability in this sector."
Unlike ‘trunk routes’ – long distance routes -- where there is stiff competition, the remote sector is still a virgin market. With single-engine aircraft relatively cheaper to acquire and operate, domestic airlines are now opting for them. In a country where flying is not only a luxury but also a supply and communication lifeline for remote areas, availability of more air seats and cargo space is in itself a major development.
Domestic carriers that were reluctant to fly in remote areas are now taking the lead in remote area service. As of now, four airlines -- Tara Air, Air Kasthamandap, Makalu Air and Goma Air -- are operating services with single-engine aircraft. Recently, Akash Bhairav Aviation has been issued an AOC for single-engine operation. The airline plans to bring two single-engine planes.
Known for their short take-off and landing (STOL) capabilities, single engine aircraft are perfect for Nepal's mountainous terrain. These planes are best suited to transport essential goods to remote places that do not have access to roads or infrastructure to handle double-engine aircraft.
Except for Tara Air, the other three airlines flying single-engine aircraft have made Surkhet their base, targeting remote areas of the Mid-West and Far West. According to Goma Air's chairman Upendra Bhattarai, the carrier is planning to provide services to Mugu, Bajhang, Bajura and Doti in the first phase before expanding to other remote areas. Air Kasthamandap has been operating flights to Jumla, Dolpa, Mugu and Humla districts from its base in Surkhet.
Infrastructure development: An urgent need
Despite bright prospects, infrastructure bottlenecks could undermine the success achieved so far. Hence, urgent steps are needed to upgrade and develop aviation infrastructure. The country's only international airport, Tribhuvan International, is overstretched with a rise in international and domestic aircraft.
Birendra Bahadur Deuja, an aviation expert and former director general of the Civil Aviation Authority of Nepal (CAAN), said business prospects in the aviation sector are bright. "However, there should be more investment by the government as the current investment in the aviation sector is very nominal," said Deuja.
According to CAAN Deputy Director Tri Ratna Manandhar, there is a dire need to improve airport technology in line with international standards. “The government should increase investment in the air navigation and surveillance system as Nepal has been receiving pressure from ICAO to improve airport standards," said Manandhar.
The government has been working to establish a second international airport and three regional international airports. South Korea’s Landmark Worldwide Company that was assigned to do a detailed feasibility study for the airport has already presented its report to the government. According to the report, a single-runway airport at Nijgadh can be finished in 2015 if construction is started this year. Landmark's feasibility study stated that the proposed international airport could handle five to 15 million passengers annually and even accommodate the super jumbo Airbus 380 after the first phase of construction.
The government has also been working to develop Janakpur, Pokhara and Bhairahawa airports as regional international airports. The expansion of these three airports would open the way for more cross-border flights between Nepal and India. The expansion of Janakpur airport into a regional international airport can attract a large number of Hindu pilgrims while Bhairahawa's expansion could give a boost to Buddhist pilgrimage.
International operations: Still cautious
The new Air Service Agreement (ASA) signed between Nepal and India in September 2009 has opened the way for cross-border flights between the two countries. The ASA has increased the number of weekly flight seats to 30,000 and opened 10 new destinations for Nepali airlines permitting them to fly to 21 destinations in India.
Buddha Air has already planned to connect seven Indian cities by the end of 2011. In the first phase, it plans to link Lucknow, Kolkata and Patna. In the second phase, it plans to extend its service to Varanasi, Guwahati, Derhadun and Gorakhpur.
Despite having started international operations to Bhutan and Lucknow, Birendra Basnet sounds cautious about Nepali airlines going international. Before Buddha, four Nepali private airlines -- the now defunct Necon Air, Cosmic Air, Air Nepal International and Fly Yeti -- started international operations which were subsequently discontinued. "Given our capacity, we should not go forward aggressively," said Basnet. "Instead, we should look at capitalising on markets where there are large numbers of Nepali migrant workers."
The new international airline being promoted by five domestic carriers is eying major tourist hubs in the region for its business. “As per our plan, we will serve the Gulf countries, Malaysia, India, China and Singapore,” said one of the promoters. They are hiring an international management team including the chief executive officer to run the five-airline consortium.
Despite having more than a dozen fixed-wing and helicopter companies, sustainability has been the major issue. The demise of Necon, Cosmic, Shangri-La, Everest, Nepal Airways, Lumbini, Gorkha and other carriers are some of the unsuccessful stories in Nepal's domestic aviation. But entrepreneurs now seem determined to take lesions from the past.
Domestic passenger movement
Year No. of Passengers Change
2007 91,6429 3.8%
2008 1,036,586 13.1%
2009 1,377,868 32.9%
2010 1,073,391 (Jan-Sept) -----
Domestic flight movement
Year No. of Passengers Change
2007 65443 6.8%
2008 69286 5.9%
2009 76191 10%
2010 55,345 (Jan-Sept) ------
SANGAM PRASAIN
The economy may not be growing by leaps and bounds, but it hasn't stopped domestic airlines from expanding. The domestic aviation sector is seeing new companies entering the scene and carriers expanding their fleets and spreading their wings beyond Nepal's borders.
With the country celebrating 2011 as Nepal Tourism Year with the aim of bringing one million tourists, the bustle in the aviation sector is understandable. The latest entrant is Goma Air that has two single-engine Cessna Caravan aircraft in its fleet. There are now nine domestic airlines and five helicopter services operating in the country.
Domestic airlines have been eyeing international operations. Their success in the domestic arena has made them confident of starting international flights. Buddha Air, after establishing itself strongly in the domestic domain, started international operations last year.
With the national flag carrier Nepal Airlines Corporation in a state of perpetual stupor, five domestic airlines have been inspired to join hands to start international operations by establishing a new company. Buddha Air, Yeti Airlines, Guna Airlines, Agni Air and Simrik Air plan to start international operations by May 2011.
Another indication of the country's aviation sector taking off is the 62 percent surge in domestic passenger movement and 36 percent rise in aircraft movement in the last 10 years (2000-09).
Remote areas: Next business prospect
Difficult geographical terrain and lack of roads in many parts of the country have provided the aviation sector huge business prospects. Single-engine aircraft are back in Nepal's skies. Many aviation entrepreneurs say the next big business for domestic aviation would be remote areas. Buddha Air's managing director Birendra Basnet is one of them. "The next big business scope for domestic airlines is remote areas," said Basnet. "As this sector is less competitive and the cost of operation is also less, there is profitability in this sector."
Unlike ‘trunk routes’ – long distance routes -- where there is stiff competition, the remote sector is still a virgin market. With single-engine aircraft relatively cheaper to acquire and operate, domestic airlines are now opting for them. In a country where flying is not only a luxury but also a supply and communication lifeline for remote areas, availability of more air seats and cargo space is in itself a major development.
Domestic carriers that were reluctant to fly in remote areas are now taking the lead in remote area service. As of now, four airlines -- Tara Air, Air Kasthamandap, Makalu Air and Goma Air -- are operating services with single-engine aircraft. Recently, Akash Bhairav Aviation has been issued an AOC for single-engine operation. The airline plans to bring two single-engine planes.
Known for their short take-off and landing (STOL) capabilities, single engine aircraft are perfect for Nepal's mountainous terrain. These planes are best suited to transport essential goods to remote places that do not have access to roads or infrastructure to handle double-engine aircraft.
Except for Tara Air, the other three airlines flying single-engine aircraft have made Surkhet their base, targeting remote areas of the Mid-West and Far West. According to Goma Air's chairman Upendra Bhattarai, the carrier is planning to provide services to Mugu, Bajhang, Bajura and Doti in the first phase before expanding to other remote areas. Air Kasthamandap has been operating flights to Jumla, Dolpa, Mugu and Humla districts from its base in Surkhet.
Infrastructure development: An urgent need
Despite bright prospects, infrastructure bottlenecks could undermine the success achieved so far. Hence, urgent steps are needed to upgrade and develop aviation infrastructure. The country's only international airport, Tribhuvan International, is overstretched with a rise in international and domestic aircraft.
Birendra Bahadur Deuja, an aviation expert and former director general of the Civil Aviation Authority of Nepal (CAAN), said business prospects in the aviation sector are bright. "However, there should be more investment by the government as the current investment in the aviation sector is very nominal," said Deuja.
According to CAAN Deputy Director Tri Ratna Manandhar, there is a dire need to improve airport technology in line with international standards. “The government should increase investment in the air navigation and surveillance system as Nepal has been receiving pressure from ICAO to improve airport standards," said Manandhar.
The government has been working to establish a second international airport and three regional international airports. South Korea’s Landmark Worldwide Company that was assigned to do a detailed feasibility study for the airport has already presented its report to the government. According to the report, a single-runway airport at Nijgadh can be finished in 2015 if construction is started this year. Landmark's feasibility study stated that the proposed international airport could handle five to 15 million passengers annually and even accommodate the super jumbo Airbus 380 after the first phase of construction.
The government has also been working to develop Janakpur, Pokhara and Bhairahawa airports as regional international airports. The expansion of these three airports would open the way for more cross-border flights between Nepal and India. The expansion of Janakpur airport into a regional international airport can attract a large number of Hindu pilgrims while Bhairahawa's expansion could give a boost to Buddhist pilgrimage.
International operations: Still cautious
The new Air Service Agreement (ASA) signed between Nepal and India in September 2009 has opened the way for cross-border flights between the two countries. The ASA has increased the number of weekly flight seats to 30,000 and opened 10 new destinations for Nepali airlines permitting them to fly to 21 destinations in India.
Buddha Air has already planned to connect seven Indian cities by the end of 2011. In the first phase, it plans to link Lucknow, Kolkata and Patna. In the second phase, it plans to extend its service to Varanasi, Guwahati, Derhadun and Gorakhpur.
Despite having started international operations to Bhutan and Lucknow, Birendra Basnet sounds cautious about Nepali airlines going international. Before Buddha, four Nepali private airlines -- the now defunct Necon Air, Cosmic Air, Air Nepal International and Fly Yeti -- started international operations which were subsequently discontinued. "Given our capacity, we should not go forward aggressively," said Basnet. "Instead, we should look at capitalising on markets where there are large numbers of Nepali migrant workers."
The new international airline being promoted by five domestic carriers is eying major tourist hubs in the region for its business. “As per our plan, we will serve the Gulf countries, Malaysia, India, China and Singapore,” said one of the promoters. They are hiring an international management team including the chief executive officer to run the five-airline consortium.
Despite having more than a dozen fixed-wing and helicopter companies, sustainability has been the major issue. The demise of Necon, Cosmic, Shangri-La, Everest, Nepal Airways, Lumbini, Gorkha and other carriers are some of the unsuccessful stories in Nepal's domestic aviation. But entrepreneurs now seem determined to take lesions from the past.
Domestic passenger movement
Year No. of Passengers Change
2007 91,6429 3.8%
2008 1,036,586 13.1%
2009 1,377,868 32.9%
2010 1,073,391 (Jan-Sept) -----
Domestic flight movement
Year No. of Passengers Change
2007 65443 6.8%
2008 69286 5.9%
2009 76191 10%
2010 55,345 (Jan-Sept) ------
Thursday, February 17, 2011
Great Himalaya Trail opens for business
SANGAM PRASAIN
KATHMANDU, FEB 16 -
Australian-based adventure travel company World Expeditions in association with Highland Excursions Nepal announced the start of commercial trekking on the Great Himalaya Trail (GHT) on Wednesday.
The government had announced the GHT, the longest and highest alpine walking track in the world, as a new product to attract trekkers from around the world during the inauguration of Nepal Tourism Year 2011 on Jan. 14.
The entire GHT is 4,500 km long and passes through Pakistan, the Tibet Autonomous Region of China, India, Nepal, Bhutan and Myanmar. The Nepali section of the GHT extends along the length of the country from Darchula and Humla in the west to Kanchenjunga in the east, and takes some 157 days to trek.
World Expeditions said that it had spilt the GHT in Nepal into seven sections of 18-34 days each. Trekking the whole trail costs around US$ 35,000, said Robin Boustead who documented the trail in Nepal in 2008. “Acknowledging that most people don’t have the luxury of this sort of time for adventure, we have devised seven treks that can be linked to make up the full traverse. The trip will be offered each year so that adventurers may choose to undertake the entire GHT over a number of years,” said World Expeditions.
The GHT is not a new product; it is the same trekking route that has been elegantly connected with the itineraries combining old and new routes. The route not only offers incredible biodiversity but is also associated with the objective of transforming untouched wilderness in the remotest districts into economic assets.
According to Highland Excursions Nepal, the product seller, more then 40 international trekkers have confirmed they would do the trek. “Trekkers all over the world are excited by the new product,” said Uma Khakurel, director of marketing and sales of Highland Excursions.
Khakurel added that the first ever commercial traverse of the GHT in Nepal would help support the people of the Himalaya to improve livelihoods, create employment and bring sustainable development opportunities to remote mountain communities.
The trail operators will raise A$ 100 from each trekker that will be given to the Australian Himalaya Foundation, an organisation helping the people of the Himalaya achieve their goals through improvements in health, education, environmental sustainability and conservation across the Himalaya.
Australian adventurer Robin Boustead documented the trail in Nepal in 2008. He completed the upper route of about 1,700 km which offers unparalleled trekking mixing high passes and alpine valleys.
“People along the trail are very excited,” said Boustead. The GHT will be one of Nepal’s unique products to increase quality and sustainable tourism. The GHT is an “international trekking trail” that emerged in the late 1990s in Nepal. However, it has been possible to walk over it since 2003.
All of the world’s 14 eight-thousander peaks can be seen on the trek. The westernmost point of the GHT is the world’s ninth highest peak, Nanga Parbat in Pakistan. It winds past the sacred headwaters of the Ganges in India, the entire length of Nepal beneath Annapurna, Everest and Kanchenjunga, through Sikkim then Bhutan and eventually to India’s remote Arunachal Pradesh, Myanmar and Namche Barwa in Tibet.
In 2004, the GHT was adopted as a pro-poor tourism initiative in the South Asia Sub-regional Economic Cooperation’s Tourism Development Plan sponsored by the ADB in Nepal, Bhutan and India (Sikkim, Darjeeling and Arunachal Pradesh). With Nepal having the most to gain due to its geography, SNV and ICIMOD took up the concept in 2006. In 2008, SNV conducted the GHT first phase pilot project in Humla and Dolpa.
KATHMANDU, FEB 16 -
Australian-based adventure travel company World Expeditions in association with Highland Excursions Nepal announced the start of commercial trekking on the Great Himalaya Trail (GHT) on Wednesday.
The government had announced the GHT, the longest and highest alpine walking track in the world, as a new product to attract trekkers from around the world during the inauguration of Nepal Tourism Year 2011 on Jan. 14.
The entire GHT is 4,500 km long and passes through Pakistan, the Tibet Autonomous Region of China, India, Nepal, Bhutan and Myanmar. The Nepali section of the GHT extends along the length of the country from Darchula and Humla in the west to Kanchenjunga in the east, and takes some 157 days to trek.
World Expeditions said that it had spilt the GHT in Nepal into seven sections of 18-34 days each. Trekking the whole trail costs around US$ 35,000, said Robin Boustead who documented the trail in Nepal in 2008. “Acknowledging that most people don’t have the luxury of this sort of time for adventure, we have devised seven treks that can be linked to make up the full traverse. The trip will be offered each year so that adventurers may choose to undertake the entire GHT over a number of years,” said World Expeditions.
The GHT is not a new product; it is the same trekking route that has been elegantly connected with the itineraries combining old and new routes. The route not only offers incredible biodiversity but is also associated with the objective of transforming untouched wilderness in the remotest districts into economic assets.
According to Highland Excursions Nepal, the product seller, more then 40 international trekkers have confirmed they would do the trek. “Trekkers all over the world are excited by the new product,” said Uma Khakurel, director of marketing and sales of Highland Excursions.
Khakurel added that the first ever commercial traverse of the GHT in Nepal would help support the people of the Himalaya to improve livelihoods, create employment and bring sustainable development opportunities to remote mountain communities.
The trail operators will raise A$ 100 from each trekker that will be given to the Australian Himalaya Foundation, an organisation helping the people of the Himalaya achieve their goals through improvements in health, education, environmental sustainability and conservation across the Himalaya.
Australian adventurer Robin Boustead documented the trail in Nepal in 2008. He completed the upper route of about 1,700 km which offers unparalleled trekking mixing high passes and alpine valleys.
“People along the trail are very excited,” said Boustead. The GHT will be one of Nepal’s unique products to increase quality and sustainable tourism. The GHT is an “international trekking trail” that emerged in the late 1990s in Nepal. However, it has been possible to walk over it since 2003.
All of the world’s 14 eight-thousander peaks can be seen on the trek. The westernmost point of the GHT is the world’s ninth highest peak, Nanga Parbat in Pakistan. It winds past the sacred headwaters of the Ganges in India, the entire length of Nepal beneath Annapurna, Everest and Kanchenjunga, through Sikkim then Bhutan and eventually to India’s remote Arunachal Pradesh, Myanmar and Namche Barwa in Tibet.
In 2004, the GHT was adopted as a pro-poor tourism initiative in the South Asia Sub-regional Economic Cooperation’s Tourism Development Plan sponsored by the ADB in Nepal, Bhutan and India (Sikkim, Darjeeling and Arunachal Pradesh). With Nepal having the most to gain due to its geography, SNV and ICIMOD took up the concept in 2006. In 2008, SNV conducted the GHT first phase pilot project in Humla and Dolpa.
Tuesday, February 15, 2011
Nepal produces veggies worth Rs 45 billion annually: Report
SANGAM PRASAIN
KATHMANDU, FEB 15 -
Nepal produces vegetables worth Rs 45 billion annually, according to Nepal Vegetable Crops Survey 2009-10. And, Rs 9 billion is invested in vegetable farming every year. The report says that around 70 percent of Nepal’s total household is involved in vegetable farming.
The first of its kind survey reveals interesting facts about vegetable farming in the country—description of vegetable holders, total area for vegetable cultivation, expenditure on vegetable farming, total production and uses of vegetables, and farmers’ access to agricultural services.
The survey carried out by the Central Bureau of Statistics (CBS) with assistance from the Asian Development Bank says that vegetables are cultivated in 232,295 hectares of land in the country.
Terai is the major vegetable growing area with an annual production of 1,437,921 tons, followed by hilly region with 1,261,041 tons. As per the survey, total annual production of vegetables in Nepal is 2.82 million tons. Of the total output, 39 percent (1.10 million tons) is used for household consumption and 61 percent (1.71 million tons) for sale. However, of the total vegetable farmers, only 18 percent are engaged in commercial farming.
In terms of cultivation area, production and value, cauliflower is the number one vegetable crop. A total of 404,580 tons of cauliflower is produced in 33,172 hectares of land in the country. According to the survey, cauliflower worth Rs 6.5 billion is produced annually in Nepal. Other major vegetable crops in terms of production are tomato (317,657 tons), cabbage (302,067 tons), pumpkin (166,424 tons) and radish (164,076 tons).
According to the survey, cauliflower, tomato and cabbage are the major money-spinners among vegetable crops. It says most commonly sold vegetables are cauliflower (339,273 tons), tomato (283,999 tons) and cabbage (269,294 tons). “As cauliflower, tomato and cabbage can be cultivated throughout the year, it is natural that they are the top three vegetables,” said agro-expert Tulasi Gautam.
Although the Terai region produces and sells more vegetables, vegetables grown in hilly region have better value. According to the survey, vegetables produced in hills in a year are valued at Rs 21.79 billion, whereas Terai products are valued at Rs 21 billion. “The reason behind the difference in value is vegetables in hills are produced during rainy reason when prices are relatively higher,” said Gautam. In terms of value, cauliflower tops the chart. It is followed by tomato, cabbage, asparagus bean, cucumber and broad leaf mustard (Rs 2 billion each).
A majority of vegetable farmers in the country are self-financed with only five percent taking loan for vegetable farming. Around 55 percent of the farmers rely on informal sectors for loans.
Among those taking loans, only 24.3 percent take loans from banks. Relatives and friends are the largest sources of loan for the farmers. “Farmers are still relying on traditional loans with high interest rates. This means they are not earning up to their potential,” said Puskhar Bajracharya, a member of the National Planning Commission (NPC). “There is a need for expanding banking services in rural areas to encourage farmers.”
Interestingly, 15.1 percent of farmers have taken loans from co-operatives. It shows that agriculture cooperatives and agriculture and fruits cooperatives are emerging as major sources of financing.
A total of Rs 9 billion is invested in vegetable farming in the country annually. The largest portion of the amount (Rs 2.3 billion; 26 percent) is invested for purchasing organic fertilisers followed by purchase/production of seeds (22 percent) and land preparation (16 percent). The rental cost of land is the highest in Terai, according to the survey.
There are 55 vegetable crop groups identified in the survey. Vegetable farming is slowly emerging as the major source of income for farmers with 12 percent of them saying that income from vegetable farming is sufficient for a year. According to the survey, on an average, five months’ expenditure can be maintained by the income form vegetable farming. The survey revealed that almost half of the vegetable farmers (48 percent) use pesticides (insecticides or fungicides). The use of pesticides was observed most prominently (72 percent) in the Eastern and Central Terai.
According to the survey, organic vegetable farming is still in its nascent stage in the country. Of the total vegetable farmers, only eight percent use organic pesticides, while 92 percent use chemical pesticides. Uttam Narayan Malla, director general, CBS, said the survey will be of a great help for planners, policy makers and researchers for the development of vegetable crops.
Top five vegetable products
Vegetable Production in tonnes
Cauliflower 404,580
Tomato 317,657
Cabbage 302,067
Pumpkin 166,424
Radish 164,076
KATHMANDU, FEB 15 -
Nepal produces vegetables worth Rs 45 billion annually, according to Nepal Vegetable Crops Survey 2009-10. And, Rs 9 billion is invested in vegetable farming every year. The report says that around 70 percent of Nepal’s total household is involved in vegetable farming.
The first of its kind survey reveals interesting facts about vegetable farming in the country—description of vegetable holders, total area for vegetable cultivation, expenditure on vegetable farming, total production and uses of vegetables, and farmers’ access to agricultural services.
The survey carried out by the Central Bureau of Statistics (CBS) with assistance from the Asian Development Bank says that vegetables are cultivated in 232,295 hectares of land in the country.
Terai is the major vegetable growing area with an annual production of 1,437,921 tons, followed by hilly region with 1,261,041 tons. As per the survey, total annual production of vegetables in Nepal is 2.82 million tons. Of the total output, 39 percent (1.10 million tons) is used for household consumption and 61 percent (1.71 million tons) for sale. However, of the total vegetable farmers, only 18 percent are engaged in commercial farming.
In terms of cultivation area, production and value, cauliflower is the number one vegetable crop. A total of 404,580 tons of cauliflower is produced in 33,172 hectares of land in the country. According to the survey, cauliflower worth Rs 6.5 billion is produced annually in Nepal. Other major vegetable crops in terms of production are tomato (317,657 tons), cabbage (302,067 tons), pumpkin (166,424 tons) and radish (164,076 tons).
According to the survey, cauliflower, tomato and cabbage are the major money-spinners among vegetable crops. It says most commonly sold vegetables are cauliflower (339,273 tons), tomato (283,999 tons) and cabbage (269,294 tons). “As cauliflower, tomato and cabbage can be cultivated throughout the year, it is natural that they are the top three vegetables,” said agro-expert Tulasi Gautam.
Although the Terai region produces and sells more vegetables, vegetables grown in hilly region have better value. According to the survey, vegetables produced in hills in a year are valued at Rs 21.79 billion, whereas Terai products are valued at Rs 21 billion. “The reason behind the difference in value is vegetables in hills are produced during rainy reason when prices are relatively higher,” said Gautam. In terms of value, cauliflower tops the chart. It is followed by tomato, cabbage, asparagus bean, cucumber and broad leaf mustard (Rs 2 billion each).
A majority of vegetable farmers in the country are self-financed with only five percent taking loan for vegetable farming. Around 55 percent of the farmers rely on informal sectors for loans.
Among those taking loans, only 24.3 percent take loans from banks. Relatives and friends are the largest sources of loan for the farmers. “Farmers are still relying on traditional loans with high interest rates. This means they are not earning up to their potential,” said Puskhar Bajracharya, a member of the National Planning Commission (NPC). “There is a need for expanding banking services in rural areas to encourage farmers.”
Interestingly, 15.1 percent of farmers have taken loans from co-operatives. It shows that agriculture cooperatives and agriculture and fruits cooperatives are emerging as major sources of financing.
A total of Rs 9 billion is invested in vegetable farming in the country annually. The largest portion of the amount (Rs 2.3 billion; 26 percent) is invested for purchasing organic fertilisers followed by purchase/production of seeds (22 percent) and land preparation (16 percent). The rental cost of land is the highest in Terai, according to the survey.
There are 55 vegetable crop groups identified in the survey. Vegetable farming is slowly emerging as the major source of income for farmers with 12 percent of them saying that income from vegetable farming is sufficient for a year. According to the survey, on an average, five months’ expenditure can be maintained by the income form vegetable farming. The survey revealed that almost half of the vegetable farmers (48 percent) use pesticides (insecticides or fungicides). The use of pesticides was observed most prominently (72 percent) in the Eastern and Central Terai.
According to the survey, organic vegetable farming is still in its nascent stage in the country. Of the total vegetable farmers, only eight percent use organic pesticides, while 92 percent use chemical pesticides. Uttam Narayan Malla, director general, CBS, said the survey will be of a great help for planners, policy makers and researchers for the development of vegetable crops.
Top five vegetable products
Vegetable Production in tonnes
Cauliflower 404,580
Tomato 317,657
Cabbage 302,067
Pumpkin 166,424
Radish 164,076
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