KATHMANDU, Nov 6: Nepal Airlines Corporation (NAC) is going to request Airbus, the leading European aircraft manufacturer, to annul the past deal and supply it with two narrow-body aircraft through new process when the two sides sit for talks on Tuesday.
Previously, NAC had signed an agreement with Airbus for procuring one wide-body and one narrow-body aircraft.
But as the corporation could not materialize the deal following controversy over payment of lock-up money, it has now decided to request the Airbus to annul the deal and carry out the procurement through fresh procedures.
The talk is being held as NAC board recently invited the officials of Airbus for talks on aircraft purchase deal. The airbus officials are arriving on Tuesday morning.
Secretary of Ministry of Culture, Tourism and Civil Aviation (MoCTCA) and Chairman of NAC Yagya Prasad Gautam said NAC has no new agenda and will focus on previous agreement only.
"We will be hearing more than saying, for we are keen to learn what the Airbus has to say on the past agreement and its legality," said Gautam. He refused to divulge further.
But sources said as the Cabinet decision mandated NAC to go for two narrow-body aircraft, its team will request for the revision of the past deal, so that it could comply with the government´s order.
"That is not all the case. The internal meeting of NAC board held on Monday evening also decided to request the Airbus to execute the fresh procurement by initiating the new process," said the source.
One of the NAC board members said NAC was requesting for the fresh start of the process, even though the Airbus was positive to revive the previous deal, because some of the senior government officials are reluctant to go ahead with it given the controversy it faced in the past.
"Some of the officials are pushing for amending the past deal and procuring two-narrow body aircraft instead of one wide-body and one narrow-body. This will make procurement faster, but others fear it might be controversial again," the source told Republica.
The senior officials fear revival of old deal, despite the fact that the apex court gave clean chit to senior NAC officials involved in the case, because the Parliament´s Public Accounts Committee (PAC) in December 2009 instructed the government to scrap it.
"So if Airbus agreea, we will terminate the past deal and start a fresh procurement process," the source added.
The NAC board in October, 2009 had decided to purchase two aircrafts - one narrow and one wide body - to expand its international fleet. But the process hit snag after Commission for the Investigation of Abuse of Authority (CIAA) filed case against the top NAC officials charging them of flouting Public Procurement Act and sending lock up money of US $ 75,000 without following due procedures.
Following the controversy, the European manufacturer returned the non-refundable lock up money to NAC in March, 2011 and that had enabled the officials to get the clean chit from the Apex court.
During the talks, which will last till Wednesday, Raju KC, acting Managing Director of the airlines said that the Airbus officials would also make presentation on their enhanced versions of A320, which are more fuel efficient than previous versions.
"We hope to get specific business proposal from the Airbus as well," said KC. As NAC can not initiate the procurement process single handedly, KC said NAC will take its procurement decision only after briefing and getting consent from the government.