Nepal Airlines (RA, Kathmandu) is requesting NPR4 billion rupees (USD33 million) from the Nepalese government to purchase new aircraft for its beleaguered domestic fleet. The carrier is keen to focus on improving its domestic network while it waits to resume international flying following the COVID-19 outbreak.

Executive Chairman Sushil Ghimire told the Kathmandu Post he has asked the country's Ministry of Finance to request the funding in the upcoming budget which is due to be presented at the end of May. Nepal Airlines made a similar proposal to the Ministry of Finance in 2018, requesting the cash to buy five DHC-6s.

"We know it's a time of crisis and the government may be pressed for cash due to the COVID-19 pandemic, but it has a social obligation to serve the vast numbers of mountain people who still depend on air transportation," he said.

The state-owned carrier wants to procure five aircraft and has assembled a team to determine the make-up of the improved domestic fleet.

Nepal Airlines currently has a domestic fleet of nine aircraft; two 56-seat MA-60s, four Y12s, and three 19-seat DHC-6-300s.

"We do have six Chinese-made planes, but they are not appropriate to fly in the Nepali skies. We cannot compete with the private sector in the market," Ghimire said. Among the four Y12s, only one is operational as there are just two trained captains capable of flying them. Out of the two MA-60s, one has been grounded for the last two years due to a lack of spare parts.

In November 2012, the airline signed a commercial agreement with the Aviation Industry Corporation (AVIC) of China, a Chinese government undertaking, to buy the two MA-60s and four Y12s. As part of the deal, AVIC provided one of each type, worth a combined NPR2.94 billion rupees (USD24.3 million), as gifts in 2014. The other aircraft were bought for NPR3.72 billion rupees (USD30.7 million) with a soft loan provided by EXIM Bank of China.

As two of the six Chinese aircraft were gifts from China, the airline cannot directly sell them, said a tourism ministry official. As a result, Nepal Airlines formed another committee to prepare a report on how the Chinese aircraft should be managed or replaced.

Ghimire confirmed that the airline would focus on the home market until the overseas demand rebounds. "As global tourism has been shattered by the coronavirus and it could take years for the industry to recover, we don't have immediate plans to buy planes for the international sector." According to the ch-aviation fleets module, the airline operates two A320-200s and two A330-200s on its international network.

The Ministry of Culture, Tourism and Civil Aviation has also appealed to the Ministry of Finance after Nepal Airlines said that it could not pay the interest on loans taken out to purchase its widebody fleet, according to a report in Bizpati. The carrier has requested relief funding from the government to cover six months of repayments on its loan.

According to the ch-aviation schedules module, for the week commencing July 20, the airline is planning to use the two A330-200s on its services from Kathmandu to Delhi International, Doha Hamad International, Dubai International, and Tokyo Narita.

Last week, Nepal Airlines estimated it would lose about NPR5 billion (USD412 million) by the end of the current fiscal year due to the effects of the coronavirus traffic shutdown.