Nepal Airlines (RA, Kathmandu) has repaid NPR1.35 billion Nepalese rupees (USD10.5 million) of fleet renewal loans provided by two state-owned funds, the airline announced.
In a statement, the state-owned carrier said NPR900 million (USD7 million) was repaid to the Employee Provident Fund (which finances national pensions) on June 30, 2022, half of which was for the acquisition of narrowbodies and the other half for the purchase of widebodies.
In addition, an instalment of NPR450 million (USD3.5 million) was repaid to the Citizen Investment Fund, which was earmarked for widebody fleet acquisitions. Details of the aircraft were not released.
According to the ch-aviation fleets module, the current fleet comprises six in-house aircraft, including:
The airline said the instalments were possible thanks to growing regular income on the back of an improvement in load factors amid the normalisation of its flight schedules following the re-opening of international borders after COVID-19. It was unable to make the payments earlier as it had been in financial distress due to the pandemic.
New Business Age reported the money was credited to the funds on July 14, 2022, after the instalment had been delayed for almost one-and-a half-years due to the pandemic.
In an earlier statement on July 1, 2022, released on the 64th anniversary of Nepal Airlines, Acting General Manager Dipuraj Jwarchan said the airline would move forward with its fleet growth plans but did not elaborate. The airline was not immediately available for comment.
He also mentioned Nepal Airlines was undergoing administrative reform, including becoming more technology-friendly and strengthening its service culture, but that there were "many challenges ahead of the corporation".
As reported, Nepal Airlines has been saddled with NPR47.9 billion (USD403 million) in debt, including liabilities to the two state-owned funds: NPR27 billion (USD227 million) owed to the Employees Provident Fund and another NPR16 billion (USD134.5 million) to the Citizen Investment Fund.
In January, the airline was reported to be "on the path to collapse" and requiring an urgent change in its business model, as its liabilities were endangering the state-run pension and investment funds with potentially catastrophic ramifications for the Nepalese economy.
Nepal Airlines also owes China EXIM Bank more than NPR3 billion (USD25.3 million) for historic acquisitions of Y12s and MA-60s.
