Nepal Airlines' Airbus deal on hold

Singapore
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Nepal Airlines' purchase of two Airbus aircraft has been put on hold while it awaits the decision of a parliamentary committee which has questioned the deal.

The Public Accounts Committee (PAC) had asked the finance ministry to stop the airline's purchase of one Airbus A330-200 and one A320, which were ordered at the Dubai air show in November.

The $250 million deal included options for four additional aircraft: two A320s, one A330, and the fourth undecided but likely to be an A330.

But the PAC stalled the purchase because the state-owned airline made an advance payment of $750,000 to Airbus without Government approval, says an airline spokesman.

"We paid the money because the budget stated that the Government will guarantee two new aircraft for the airline," he adds.

The carrier expects the PAC to decide within a month as to whether the airline can go ahead with the purchase, he says.

"We have finalised the deal, but the ball is not in our court at the moment," adds the spokesman.