It augurs well for NTY-2011

With two months still left for the year to end, the number of tourists is expected to cross 450,000 if the current trend of the last 10 months continues

SANGAM PRASAIN
KATHMANDU, NOV 02 -

With Nepal Tourism Year-2011 approaching, the number of visitors coming to Nepal has started to jump significantly. The country witnessed an 18.4 percent rise in the number of tourists entering Nepal by air during these 10 months of 2010.

The number of visitors reached 364,115 from January to October compared to 307,532 during the same period in 2009. With two months still left for the year to end, the number of tourists is expected to cross 450,000 if the current trend of the last 10 months continues.

There is an encouraging sign in tourist arrivals in November with hotels showing over 95 percent bookings for the month. In 2009, the country received 378,712 tourists by air only.

In October, the country witnessed highest tourist arrivals in 10 months this year with 62,712 visitors entering the country. This is a 12 percent rise in the number of visitors compared to the figure the same month last year, according to figures released by the Immigration Office, Tribhuvan International Airport (TIA). The growth momentum is a welcome development when the country is celebrating the tourism year. Nepal seeks to bring a million tourists by both air and ground in 2011 and 700,000 alone by air.

The improved tourist arrivals, increased number of airlines, expansion of hotels, lodges and resorts and private investors injecting massive money in the sector in recent days show that the tourism sector is witnessing a boost.

However, travel trade entrepreneurs and economists say that it cannot be measured as tourism development on the basis of just month-by-month arrival numbers. “The sustainability of tourism sector in any country is determined by the parameters of tourism competitive index,” said economist Bishwambar Pyakurel. “Unfortunately, the government and its planners do not have any institution and infrastructure to develop Nepal’s future in tourism.”

Nepal’s tourism sector has come a long way since Sir Edmund Hillary and Tenzing Sherpa first climbed Mount Everest in 1953. The Himalayas have been one of the main attractions for tourists visiting this country since the duo’s ascent to the highest peak of the world.

In the 1950s, there was a shortage of hotels. Beginning in the 1960s, the government encouraged the building of hotels and other tourist facilities through loans. According to government statistics, between 1985 and 1988 the number of hotel rooms increased from under 22,000 to more than 27,000. Until 1983, tourism in Nepal was well established. It was a major source of foreign exchange earning. Mountaineering and hiking especially were of considerable interest as were rafting, canoeing. Tourism was facilitated with the opening of airways to Kathmandu and other parts of the country and easing of travel restrictions.

However, in 1989 the trade and transit impasse with India negatively affected tourism because the transport and service sectors of the economy lacked supplies. Beginning in the FY 1990, Kathmandu initiated a policy to allocate fuel on a priority basis to tour operators and hotels.

Prior to the trade impasse with India beginning in March 1989, tourism had grown by more than 10 percent per year for most of the 1980s. Between 1985 and 1988, the number of tourists increased from approximately 181,000 to about 266,000. More than 80 percent of the tourists arrived in the country by air.

However, from 1996 onwards, the country’s tourism sector faced the greatest setback. The beginning of the Maoist insurgency deterred potential tourists for a decade. However, there was no significant impact of the insurgency until 2000 because country celebrated Visit Nepal Year in 1998.

“If we analyze the tourist arrival trend before the insurgency period, the current arrival figures should be taken as just a market correction,” said Ashok Pokhrel, president of Nepal Association of Tour Operators. The current growth could be achieved due to ending of the decade-long civil war.

“The arrival figures show growth in the number of Indian, Chinese and Bangladeshi tourists. We are very concentrated on the neighboring countries although these are our pocket markets,” he said adding that the focus should be on those markets that yield high-end tourists. During the tourism year, Nepal aims to bring 265,000 Indian tourists and 100,000 Chinese tourists while the European market is expected to grow by 20 percent. Yet, the worrying factor is the length of stay in the country that has been declining for the last few years although arrivals are going up.

Arjun Sharma, president of Nepal Association of Tour and Travel Agents (NATTA) said the country’s tourism industry can reap benefits only if the tourists’ length of stay increases. He said that the government should consider the Nepali tourism sector a prioritized sector and increase the confidence of investors. Likewise, concerns regarding the country’s national flag carrier should be a priority. The Nepal Airlines Corporation does not have enough aircraft for international flights and its attempt to bring two airbuses has been mired in scandal.

As more than 80 percent of arrivals to Nepal are by air, without improvement in air accessibility Nepal’s tourism cannot achieve its full growth. Entrepreneurs have also been lobbying hard with the government to enable Nepal Airlines Corporation to purchase more aircraft for sustainable tourism development of the country.


Month Arrivals (2009) Arrivals (2010) Change (%)

Jan 21,944 26,071 18.80

Feb 25,181 33,492 33.00

Mar 33,005 44,431 34.61

Apr 37,819 38, 694 2.31

May 25,129 26,634 5.98

June 23,222 26,997 16.30

July 23,266 29,338 26.09

Aug 27,676 34,415 24.30

Sept 34,281 41,331 20.60

Oct 56,009 62,712 11.96

Total 307,532 364,115 18.39

(Source: NTB)

It’s got potential

Nepal could boost its lentil export with proper government initiatives


SANGAM PRASAIN
KATHMANDU, NOV 01 -

Nepal could boost its lentil exports to Rs. 25 billion annually if the government does proper research, provides improved seeds and improves links with the international market, a government official said.

The country’s three-year interim plan, which is in the final stage of endorsement, has targeted increasing production of pulses to 377,000 tons from 262,000 tons presently.

The plan aims to increase output by 115,000 tons in three years. If this quantity is exported, the country can earn another Rs. 12 billion. Lentils are one of the country’s high-value crops. According to the Agriculture Ministry, lentils account for 90 percent of the total export of pulses. Bangladesh and the Middle East are the largest importers of Nepal’s lentils.

In 2008-09, exports jumped to 56,767 tons worth Rs. 5.66 billion from Rs. 1.62 billion in 2007-08 to become the country’s largest export. However, exports shrank to 37,779 tons worth Rs. 3.74 billion in 2009-10, according to the Trade and Export Promotion Centre. “The rise in exports recorded in 2008-09 shows that lentils are a potential commodity to narrow the increasing trade deficit the country has been facing for a long time,” said Hari Dahal, spokesperson at the Ministry of Agriculture. According to Nepal Rastra Bank’s annual macroeconomic statistics, the plunge in the export of lentils was reflected in a drop in the overall export volume. Total exports dipped 9.7 percent in 2009-10 to Rs. 61.13 billion.

Traders said that exports of lentils dropped as a result of a government ban imposed last year in response to pressure that the country might face a food deficit after India stopped exports. However, after entrepreneurs assured the government that exports would not affect the country’s food supply, the government lifted the restriction.

Lentils are well received in the international market. Considering the fact that

the international market for lentils

has increased by 6.8 percent in terms of value and 6.2 percent in terms of volume in the last 10 years, traders say lentils have massive prospects.

“An appropriate trade facilitation policy and introduction of accredited food

quality certification to link with the global market would boost production and exports,” said Dahal. In 2007, Nepal was the sixth largest producer of lentils in the world. In 2008, Nepal rose to the number three slot with an output of 161,147 tons after Canada (1 million tons) and India (810,000 tons).

Production slipped to 161,147 tons in 2007-08 and further to 147,725 tons in 2008-09, according to the Agriculture Ministry. Similarly, the area under cultivation declined to 189,497 hectares in 2007-08 and to 183,798 hectares in 2008-09. The ministry said that improved seeds introduced by the Nepal Agricultural Research Council had boosted production to some extent.

“Unfortunately, the government does not have any special programme to boost lentil production that has such a tremendous export potential,” Dahal added.

More than 90 percent (139,700 tons) of the lentils grown in Nepal come from the Tarai. Output in the mountains and hills amounts to 1,171 tons and 6,437 tons respectively. Dang district is the largest producer of lentils in the country. In 2008-09, Dang produced 27,568 tons followed by Sarlahi (19,230 tons), Rautahat (15,920 tons), Bara (14,146 tons), Kailali (12,836 tons) and Bardia (10,246 tons).

NAC move sees a revival

Govt mulls forming high-level body to handle aircraft purchase for national carrier

SANGAM PRASAIN
KATHMANDU, OCT 30 -

Nepal Airlines Corporation’s latest plan to enlarge its fleet, which has bogged down in controversy like many times before, has regained pace after a 10-month lull with the government mulling forming a high-level body to handle the procurement.

The new move, initiated by the Ministry of Finance, has been brought forward as repeated efforts to purchase aircraft for the national flag carrier have ended in dispute. With Nepal Tourism Year 2011 round the corner, NAC is in dire need of additional planes. The Finance Ministry says it is ready to provide a guarantee for the aircraft procurement, but its only concern is that the process should be transparent and that the aircraft should fulfil NAC’s requirement.

The government, according to a senior Finance Ministry official, has dropped the plan to purchase wide-body aircraft. “Now, two narrow-body planes will be purchased for NAC,” said the official. “There is broad consensus on a narrow-body jet.”

However, the new process will move forward only after the Commission for Investigation of Abuse of Authority (CIAA) gives the final verdict on the aborted Airbus deal. The CIAA is currently at the final stage of its investigation into the Airbus purchase plan and is expected to give its final decision soon. It had seized all the documents related to the proposed aircraft purchase in the second week of August.

NAC’s plan to acquire two new aircraft stalled when the parliamentary Public Accounts Committee (PAC) directed the government to cancel the Airbus deal in December 2009 citing violation of the law governing public purchase. The NAC board had decided to purchase two aircraft from Airbus on Oct. 26 to enlarge its international fleet. In its proposal, Airbus had quoted US$ 41.28 million (Rs. 3.08 billion) for a narrow-body aircraft and US$ 92.84 (Rs. 6.93 billion) for a wide-body aircraft.

Apart from PAC, the Finance Ministry had also instructed the Ministry of Tourism and Civil Aviation to dump the purchase plan. In May 2010, the Finance Ministry had written to the Tourism Ministry that it would be unable to provide a guarantee for the loan required to purchase the aircraft and had asked it to scrap the planned purchase and initiate work to recover the commitment money sent to Airbus.

With its attempts to acquire aircraft having proved futile, the government is now thinking of forming a high-level body to procure aircraft for NAC. The Finance Ministry is of the view that an independent body would be the best option, given the controversy over the aircraft purchase. The Council of Ministers recently asked the Tourism Ministry to submit a proposal regarding a new purchase process.

“The Finance Ministry is willing to provide a government guarantee if the new procurement process is acceptable to them,” said Kishore Thapa, secretary at the Tourism Ministry. The new budget, according to Finance Ministry sources, will contain a specific arrangement in this connection. “If things go as planned, NAC will get two narrow-body aircraft by the middle of 2011,” Thapa said. He said that the two aircraft would operate on routes to the northern and southern neighbours considering their huge outbound potential. Nepal has signed Air Service Agreements with 36 countries as of now. However, the limited fleet of the national carrier has been unable to tap the market potential. The weak presence of the national flag carrier in the international arena has prompted many international airlines to start service to Nepal.

“We’re losing millions in foreign currency as NAC doesn’t have sufficient aircraft for international routes,” said a Finance Ministry official.” The international airlines serving Nepal are making a lot of money.” The international airlines flying to Nepal are doing good business carrying over two million passengers annually. “There is also a need for wide-body aircraft as the movement of Western tourists has been increasing each year. However, a narrow-body plane would also be fine with the country celebrating NTY and the national flag carrier being short of aircraft,” said Ram Kazi Koney, a travel trade entrepreneur.

Brushing up on airspeak

CAAN asks for extending deadline to meet ICAO's language proficiency requirement

SANGAM PRASAIN
KATHMANDU, OCT 27 -
The Civil Aviation Authority of Nepal has requested the International Civil Aviation Organization to postpone the deadline for introducing English language proficiency requirements for effective radiotelephony communication among air traffic controllers and pilots engaged in international operations. The closing date has been set for March 5, 2011.

CAAN asked that the time limit be put off at ICAO’s 37th general assembly citing scarcity of resources and manpower and inadequacy of national regulatory documents. The meeting was held in Montreal, Canada from Sept. 28 to Oct. 8. However, CAAN has not received any response from ICAO, a participant in the general assembly told the Post.

There are about 60 air traffic controllers in Nepal handling international operations. According to Nepal Airlines Corporation spokesperson Pradip Karki, there are 33 pilots operating international flights.

Nepal had pledged at the 36th general assembly that full compliance with the language proficiency requirements would be achieved before 2011. As per the call of the ICAO state letter, CAAN had posted its implementation plan to ICAO in early 2008 with a compliance target of 2009.

Pursuant to this scheme, CAAN had established a training facility under the name Civil Aviation Academy containing an audio lab and other training equipment. Nepal has two qualified trainers, Narendra Bahadur Thapa and Saurav Ranjan Baral, who have received advanced training. Two others, Bimal Subedi and Tek Nath Sitaula, have received basic training.

“Although, CAAN has established an audio lab and other language training facilities, nothing more has been done,” a CAAN source said.

The ICAO assembly meets at least once every three years with its 190 member states to establish its worldwide policy for the next three years. As part of the effort to prevent aviation accidents, ICAO has introduced language provisions to ensure that air traffic personnel and pilots are proficient in conducting and comprehending radiotelephony communications in the English language. ICAO also requires that the English language shall be available on request at all stations on the ground serving designated airports and routes used by international air services.

In 2003, ICAO introduced standards for Level 4 language proficiency requirements, 26 years after the Tenerife disaster in which a 747 crashed into another 747. The accident is acknowledged to be a powerful activator for ICAO to initiate language enhancement efforts for aviation personnel, particularly air traffic controllers, pilots and aeronautical station operators. The collision between the two Boeing 747s of Pan Am and KLM at Tenerife airport is the worst aircraft accident in aviation history that occurred due to poor direction by air traffic control. The language testing criteria for global harmonization produced by ICAO was provisioned to the member states to comply with a language proficiency rating scale of Level 4 or above by March 5, 2008. However, after a majority of the developing countries requested postponing the deadline due to inadequate resources and trainers, ICAO extended the time limit to March 5, 2011. Though Nepal’s pilots and air traffic controllers engaged in international operations have met ICAO’s minimum language proficiency requirements, difficulties are still seen in improving their language proficiency to meet ICAO standards within a short period.

“We have hired an ICAO expert, who arrived on Oct. 18, to look after the technical aspect and upgrading of training equipment,” a top CAAN official said.

Meanwhile, CAAN has been working to fulfil the obligations. A working paper presented at the ICAO general assembly says that Nepal is considering participating in the 10th Aviation English Forum of the International Civil Aviation English Association which will discuss the theme of sustaining ICAO language proficiency requirements implementation beyond March 2011 from the operational and language training and testing perspectives. The forum is scheduled to be held in Malaysia from Nov. 23-24.

However, a CAAN source said that everything was progressing at a slow pace although it was not difficult to meet ICAO’s language proficiency requirements until March 2011.

TIA congestion hits domestic airlines

SANGAM PRASAIN
KATHMANDU, OCT 25 -

The rise in the movement of international and domestic aircraft has created a heavy congestion in the Tribhuvan International Airport (TIA). The domestic airline companies have been forced to delay their flights by over an hour daily.

Domestic aircraft have to wait for more than 45 minutes for take-off and hold around 15-20 minutes in the sky waiting for landing permissions in the TIA. The domestic air operators say it has increased their cost of operation on one hand, while they are forced to face the wrath of passengers on the other.

With the resurgence of tourism, a large number of foreign airlines has started flights to Nepal. The TIA is now handling over 27 international airlines and it is expected that the international connection will go up to 32 soon. The TIA, which has been designed to process a maximum of 30 aircraft per hour through a single runway, is now processing over 41 aircraft an hour. With such a rise in the movement, the TIA was compelled to handle 434 aircraft movement in a single day recently.

Domestic airlines operators said that the congestion problem is more in the morning because of mountain flights. The congestion is more

severe during October and November when large numbers of tourists opt for mountain flights and travel to Lukla, Pokhara and other tourist destinations.

The delay problem is more acute for aircraft flying in instrument flight rules (IFR) system. The IFR flyer normally have to wait for more than one hour for take-off. Given the hostile geographical terrain of Nepal, most flights use the IFR system. For the visual flight rules (VFR), which allow a pilot to operate an aircraft in weather conditions generally clear enough, the aircraft is delayed by almost 45 minutes everyday due to busy air schedule.

“An aircraft which used to make 14 round-trip each day is now doing only 10 roundtrips due to airport congestion,” said Rupesh Joshi, marketing manager of Buddha Air, which operates 45-50 flights every day.

Yeti Airlines and its sister airline Tara Air that has over 60-70 flights each day said they are compelled to operate their flights more often. “If an international aircraft is landing, a domestic one has to wait for over 45 minutes to take off. The airline cost surges when it is compelled to wait after the aircraft engine has started for take-off,” said Binay Shakya, manager of Yeti Airlines.

According to Shakya, a one-minute wait means losing fuel worth Rs 1,700. One aircraft consumes fuel worth US$ 2,720 per hour. “The deficit is more while the aircraft

is on hold in air,” he added. He said the airlines are delayed mostly in the long-haul sector.

Pramod Pandey, marketing director of Agni Air said the airlines has a facility to operate during evenings under the IFR, which is the only alternative to reduce air traffic congestion, but passengers are reluctant to fly during the night. “This is a prime business season for the domestic

airlines, but is not expected to

pick up although demand from visitors is high,” he said. Agni Air has over 24 flights including the daily mountain flight.

The TIA management says it can’t do much. According to TIA General Manager Dinesh Shrestha, the TIA is forced to hold the aircraft or delay take-off every day considering their safety. “Airline movement is increasing, but we have to process both domestic and international airlines at the same time from a single runway,” Shrestha said.

Shrestha added that the TIA cannot afford more flight movement as the airport space is limited. The

congestion at the country’s sole international airport has forced policy makers to look for one more international airport.

The government has speeded up the process to develop a second international airport at Nighgadh in Bara and a regional international airport in Bhairahawa and Pokhara. They are still at the planning stage.

Nepal is No. 4 in ginger production

POST REPORT
KATHMANDU, OCT 21 -

Nepal has become the world’s fourth largest producer of ginger after India, China and Indonesia.

In fiscal 2007-08, Nepali farmers produced 158,905 tons of ginger worth Rs. 9.2 billion compared to the global output of 1.3 million tons. Exports amounted to Rs. 1.3 billion out of which 99 percent went to India, said the Ministry of Agriculture and Cooperatives.

Ginger is one of the agriculture products identified by Nepal Trade Integration Strategy (NTIS) 2010 having export potentials. Ginger export from Nepal has been increasing in the past six years. From 2004 to 2008, the export of ginger has increased by 34 percent, according to NTIS.

The NTIS says increased use of ginger by Ayurveda pharmaceutical industries in India and Nepal and high potential for product diversification -jam, jelly, candy, sauces- makes ginger one of the export potential products

The fact that more farmers are in to commercial ginger farming can be gauged by the fact that its farming has spread in to 16,788 hectors of land in 2009-10 from 11,830 hectors of 2003-04. However, its productivity has not increased significantly.

Ginger production has increased to 190,544 tons in 2009-10 from 150,593 tons in 2003-04. Productivity per hectare is 11 tons in comparison to 18 tons in India and 51 tons in the US. "Productivity in our country

is very low due to lack of hybridized seeds, technology and manure," said Dahal.

Although the government has not taken any initiative for commercial farming, farmers have been producing ginger at the local level. Ilam is at the top position in ginger production among two dozen ginger producing districts including Palpa, Salyan, Doti, Morang, Kailali and Syangja.

In fiscal 2007-08, ginger output amounted to 27,675 tons in Ilam, 12,688 tons in Palpa, 12,300 tons in Salyan, 9,300 tons in Doti, 8,400 tons in Morang, 7,500 tons in Kailali and 5,000 tons in Syangja. Dhading, Tanahu and

Bhojpur are also large producers of ginger. Some of the farmers from Palpa have even begun ginger export to Japan.

Though ginger export from Nepal is gradually increasing, Nepal imported ginger worth Rs. 550 million due to lack of access to markets and transportation. About 96 percent of the imports came from China with the rest coming from Hong Kong, Ethiopia, India and Canada. Hari Dahal, spokesperson of the Agriculture Ministry, said that traders were forced to import ginger despite adequate domestic production because of lack of access to markets.

Apart from the use of ginger as a spice, it is also used in medicine and oil processing. Dahal said that export prospects could be expanded by building processing plants and cold stores. The US, Saudi Arabia, England, Japan and Spain are among the largest consumers of ginger.

More muscle for TIA

SANGAM PRASAIN
KATHMANDU, OCT 21 -

Tribhuvan International Airport (TIA), the country’s sole international airport is getting some new infrastructure while the existing system is being renovated to increase facilities and enhance passenger processing capacity.

Officials at the Civil Aviation Authority of Nepal (CAAN), the regulatory body of the aviation sector, said that the renovation and construction works had been carried out through CAAN’s internal budget considering the pressure on TIA to handle passengers’ rush during the Nepal Tourism Year 2011 (NTY-2011). NTY’s 100-days countdown began on Oct. 7, and the government as well as private sector is gearing the up for construction and renovation work more aggressively.

Due to inadequate modern facilities, TIA is compelled to face huge challenges because of the continuous traffic growth for the last couple of years.

TIA, which was designed to handle 1,300 passengers per hour, sometimes has to process over 2,000 passengers. The pressure is likely to mount as the country has targeted to attract an additional over one million inbound and outbound passengers’ movement.

“We are using the CAAN’s internal budget for the purpose although the overall TIA improvement project has been undertaken by the Asian Development Bank (ADB) funding,” said CAAN’s director general Ram Prasad Neupane.

According to him, the CAAN’s internal improvement programme would not get in the way of ADB’s TIA improvement project. “The renovation and construction work does not come under the detail design undertaken by TIA improvement project,” he added.

Some short-term programmes like constructing a golden gate at the entry point, runway maintenance, radar antenna maintenance, sterile hall construction, billboards in different places and helicopter apron construction among other projects are on in full swing to enhance TIA’s capacity.

The internal budget of CAAN will also be utilized for painting the building and improvement and cleaning of a restroom. All this immediate internal work will be completed before the NTY-2011 starts. The Ministry of Tourism and Civil Aviation has directed that the work be done at the earliest.

The country has targeted to bring 700,000 tourists by air during the campaign. The new international airlines connecting Nepal have created both opportunities and challenges for TIA. Currently, there are 28 international airlines operating in Nepal. According to the Tourism Ministry, international airlines in Nepal are estimated to reach over 32 soon.

In 2009, the TIA processed over 2 million (incoming and outgoing passengers). However, with the campaign target to bring over 700,000 tourists by air TIA should handle additional 1.4 million inbound and outbound passengers’ movement.

TIA general manager Dinesh Shrestha said that the golden gate construction, laying marble slabs on the ground surface of the terminal and helicoptor parking areas are in the final stage. TIA has called a tender for gardening and welding of walls. “The remaining work will be accomplished soon,” he said.