The Civil Aviation Authority of Nepal (CAAN) has moved to block Korean Air (KE, Seoul Incheon) from flying to Nepal in retaliation for South Korea's aviation regulator preventing Nepal Airlines (RA, Kathmandu) from flying to Seoul Incheon, ostensibly violating a 20-year-old bilateral air services agreement.

Korean Air presently flies up to three times per week on the Seoul Incheon - Kathmandu city pair using A330-300s. It is the only airline to fly the city pair and regularly operate between the two countries. While Korean Air received CAAN approval to conduct the Kathmandu flights, per the air services agreement, reciprocal permission from Korea's Office Civil Aviation (KOCA) for Nepal Airlines to fly to Seoul is yet to materialise. KOCA has failed to provide any reasons for this.

The Himalaya Times is reporting on the issue, saying that the CAAN has now decided to block Korean Air flights from October 29, 2023. CAAN says the current monopoly-style situation encourages high fares and "non-competitiveness." CAAN spokesman Jagannath Niraula said Nepal Airlines had been talking to KOCA for some time about Seoul flights, without success. He also added that after October 29, passengers could take connecting flights on other carriers, "which may be even cheaper than what it is now."

Both UK and EU aviation safety authorities have bans on any Nepalese flagged carrier from operating in their airspace due to safety concerns.