NAC to seal loan agreement with Provident fund and Investment fund by NAC for Aircraft purchase

22nd May, 2017 | Tourism Mail Crew

KATHMANDU, May 22 : Nepal Airlines Corporation (NAC) is about to seal loan agreement on Tuesday with two organizations for purchasing wide body aircraft.

NAC is ready to do loan agreement with Employees Provident Fund and Citizen Investment Fund on the government guarantee. Soon after the agreement both institutions are ready to provide first installment worth Rs 4/4 billion to NAC.

Just three weeks ago the cabinet agreed to act as a guarantor NAC to purchase wide body aircraft. Along with that the Ministry of Finance sent a letter to provident fund and citizen investment fund to precede the loan process.

According to it, both institutions are about to provide 50/50 percent of required amount worth Rs 23 billion to NAC on Tuesday.

Finance Ministry has sent a letter to both institutions for the loan worth Rs 23 billion to purchase two wide body aircraft of airbus 330-200.

"Both institutions have agreed to provide loan worth Rs 11 billion 500 million per year on nine percent interest," NAC managing director Sugat Ratna Kansakar said. He further said that the both institutions will provide first installment of Rs 4/4 billion immediately.

"By next week we'll send Rs 8 billion to the American Leasing Company AAR Corporation," he said. NAC informed Karobar that it has even discussed about dollar exchange with the officials of Nepal Rastra Bank.

Kanskar said that AAR Corporation has already informed about delay payment due to dally on loan agreement. Soon after the loan agreement NAC had agreed to send Rs 8 billion to the Corporation. And rest of the amount (Rs14 billion 630 million) will be sending before the delivery of the aircraft.

NAC has already agreed to take Rs 23 billion loan on nine percent with provident fund and citizen investment fund for purchasing two wide body aircraft of airbus 330-200.

Though the current interest rate is nine percent, it might reduce in coming days as per the market demand, Kansakar said.

NAC is purchasing two aircraft on $208 million 16 thousand. Corporation will provide two aircrafts within 14 months. NAC has a flight plans to South Korea, Japan, Australia, London and other destinations.