Govt sends purchase order for RJ-100 aircraft

By Ameet Dhakal

KATHMANDU, June 6 - The shady deal to purchase Avro RJ-100 aircraft for Royal Nepal Army (RNA) at an inflated cost of 2.31 billion rupees (US$ 33 million) reappears after a gap of over one year worrying the experts that it could rob the country over 560 million rupees (US$ 8 million).

According to a highly placed government source, Ministry of Defense last week sent a purchase order to British Aerospace Systems, manufacturer of RJ-100 confirming the aircraft its decision to purchase the aircraft. The purchase order was sent as per the decision of May 22 Cabinet meeting, says the source.

However, the ministry is yet to send payment to the supplier as Rastriya Banijya Bank(RBB), the major financier in the consortium loan, is yet to sanction a loan of about 900 million rupees for the purchase.

According to the source, RBB board is likely to meet "any time" soon to decide the loan sanction.

RBB board could never rich an agreement on the issue in the past. Some of the board members have taken tough stance that the RNA should agree a bond under which the bank could recover the loan from Army Welfare Fund in case RNA failed to repay the loan as per the agreed schedule. The Army has a deposit of over 2.5 billion rupees from its welfare fund in the bank.

RNA has denied so far to sign the bond and has insisted on unconditional lending as the government has already issued guarantee, under which the government will be liable for the repayment in case of default by the army.

The other constituents of the consortium financing, The Employees Provident Fund and two private commercial banks are reportedly ready to follow in case RBB _ the leading financier in the consortium_ agreed to lend.

RNA’s plan to purchase the aircraft was first endorsed by the caretaker coalition government of Nepali Congress and Communist Party of Nepal-United Marxist Leninist (CPN-UML) just before the last general election held on May last year. However, the decision was sent to cold storage after a story carried out by this newspaper on the controversial decision created a firestorm against it.

Addressing a press conference on July 23 after being elected as Prime Minister, former premier Krishna Prasad Bhattarai had ruled out the purchase of the aircraft. He was then quoted as saying, "As a Defense Minister, I am now saying that there will be no purchase of the RJ-100." However, Bhattarai government didn’t revoke the former government’s decision, neither the finance ministry repealed the decision taken by the then finance minister Bharat Mohan Adhikari to issue bank guarantee for the aircraft purchase. This clearly left the vested interests with a solid chance to activate the deal.

The Kathmandu Post had opposed (and still stands by it) the purchase of the aircraft mainly on three grounds. First, the RNA decided to buy the aircraft without any global tender or notification against its practice of calling tender even for the supply of military provisioning, more commonly knows as ration-thekka.

Second, the price quoted was inflated. It was quoted at US $ 33 million, (which is still valid) US$ 8 million higher than the price at which British Aerospace had sold four aircraft to City Flyer Express last year. The British Aerospace website (http://www.bae.couk/index.htm) clearly stated that it had sold 4 aircraft to City Flyers at US$ 100 million. The website still retains other information but interestingly, the selling price have been removed.

Third, the technical team within the army had initially rejected the purchase of the aircraft saying it was not economically viable and was not feasible for carrying rescue operations the main reason cited earlier for the purchase of the aircraft. The technical team had billed the aircraft’s operating cost at US$ 3973 per bloc hour, higher than RNAC’s any existing aircraft’s operating cost. And the team had reported that the aircraft cannot land in more than three major airports of the country.

Experts fear that the purchase of the aircraft would eventually hit the already vulnerable financial institutions, mainly RBB, which hold a chunk of public saving. They point to a past instance in which the army neither paid interest nor capital of a loan obtained to buy a helicopter under the government guarantee. Neither the government has paid such loans to the financial institutions. The government still owes a large due to RBB where it was a guarantor.

Indian official denies ‘secret report’

By a Post Reporter

KATHMANDU, June 6 - Brajesh Mishra, Principal Secretary to the Indian Prime Minister, today categorically denied India’s involvement in the "secret report" linking Nepali politicians, businessmen and media with Pakistani intelligence agency ISI.

"The report was not prepared by the Indian government," Mishra told reporters today on his arrival at the Tribhuvan International Airport. "I deny the report."

The report, titled Nepal Gameplan, has been attributed to Indian intelligence. Indian news magazine India Today in its latest edition has made the claims and the 75-page report can be accessed at India-today.com, the magazine’s website.

Mishra, who is leading a High Level Task Force (HLTF), has been quoted by India Today as saying that he would raise Indian security concerns (as dealt at length in the report) during his Nepal visit.

When asked to comment whether he would raise the security issues with Nepali officials, Mishra said: "I was misquoted."

Mishra said the two sides will concentrate on "purely economic and trade issues". The Nepali side is headed by Chief Secretary Tirtha Man Shakya.

The HLTF is mandated to review progress in the implementation of the Indian-aided projects in Nepal and identify and prioritize new projects and areas of cooperation.

Talking to reporters after the first day of talks, Mishra said the two sides discussed the "entire gamut of bilateral cooperation...Setting up of the emergency trauma centre at the Bir Hospital is one of the new projects discussed in the health sector."

Chief Secretary Shakya said the Outer Ring Road in Janakpur, review of customs services, extension of broad-gauge railway line to Raxaul were some new projects discussed today.

The two-day meeting concludes tomorrow. Mishra postponed his visit, slated for May 26 due to his preoccupation with the crisis in Sri Lanka.

Govt slams India Today report

KATHMANDU, June 6 (PR)- Government today expressed distress over the India Today news report that has implicated Nepal’s political parties, media and Nepal-based Muslim groups of links with Pakistan intelligence agency ISI. The magazine attributed the report to Indian intelligence findings.

"It is distressing that such an article has been published with the malicious intentions," said Gyan Chandra Acharya, Spokesman of the Ministry of Foreign Affairs. "The report is a despicable attempt to cast aspersions on the friendly relations between Nepal and India," said Acharya in a press release issued by the Foreign Ministry. "The publication of the article with the unsubstantiated allegations before the visit of the Indian delegation seems to be intended to vitiate the atmosphere.

"His Majesty’s Government is committed to its policy of not allowing Nepal’s territory to be used against any friendly country."

Budget overlooks sports sector

By Suman Malla

KATHMANDU, June 6 - Even as the debate on the newly presented annual budget is evoking a mixed bag of responses, sports fraternity has expressed unanimous dissatisfaction over it, adding that it could jeopardize Nepal’s participation in the upcoming Olympic Games in September.

Rs 100 million allocated for sports for the current fiscal year is actually a comedown over the last two fiscal years and officials warn it will not even be able to meet the salary of sports establishment personnel according to the newly revised salary structure.

Officials say if they failed to get a supplementary budget in the next few months, Nepal will not be able to take part in Sydney Olympics. Very similar is the fate of the biennial National Games slated for next year.

Expectations were high, especially after the successful hosting of the 8th SAF Games last year. Add to the expectations the claims made by the Minister for Education and Sports, Amod Prasad Upadhyay, who days after his appointment said that the new government would accord high priority to sports.

Finance Minister Mahesh Acharya’s budget unveiled on May 30 announced no new programmes in sports, pouring cold water over impressive announcements made last year after an unprecedented success in SAF Games.

"What has been allocated to sports is definitely too low," says the President of Nepal Olympic Committee (NOC), Rukma Shamsher Rana. "We aren’t directly responsible for raising funds for any international participation, yet we are concerned for the players’ performances."

Nepal, which first participated in 1964 Tokyo Olympics, is planning to send six athletes to Sydney with two each in athletics and swimming. While the discipline for the two remaining seats is yet to be decided, Nepal is also trying for four more wild card entries.

"There are almost 1,400 staff, including coaches," said a highly placed official at the National Sports Council, "which alone will require Rs 135 million under the new pay-scale."

The sports budget for the current fiscal year is over 33 percent down compared to Rs 150 million in 2055/56.

While frustrated NSC officials claim they had approached "everyone concerned to demand a raise in the budget allocation" prior to the presentation of the Budget, the National Planning Commission says it never received any "proposal" from the Sports Council.

"We used to get (pre-budget) suggestions from the board of NSC in the past, but we got nothing from them this time," Dr Nirmal Pandey, Member of the National Planning Commission, who overlooks the sports sector, told this reporter.

He did not rule out the possibility of "further exercises" to accommodate the needs of the beleaguered sports sector.

But many others are urging the sports establishment to gradually avoid dependence on the government and "explore new avenues to enhance country’s sports" and invite private sector in the sporting arena.

The 1984 Olympics held in Los Angeles is a watershed. It tapped the reserve of the private sponsors and make it a hugely profitable enterprise. Closer home, Indian Finance Minister, Yashwant Sinha, announced tax exemption to corporate donations for sponsoring Olympic

disciplines.

"That would be a great idea for the overall development of sports in the country," says NOC President Rana. "I’m afraid, though, it may not come as handy here as that in India (given the limitations of our corporate houses). Yet it will be worthwhile to give it a shot."

According Rajendra Gurung, Marketing Manager at Gorkha Brewery Ltd, his company is "positive" about the idea.

Member-Secretary of National Sports Council (NSC), Binod Shankar Palikhe says "an unambiguous set of guidelines is being framed to extend concessions to potential private parties. Upon consultation with the Sports Minister, it will then be presented to the Ministry of Finance for approval."

Elderlies going without allowance

By Ram Prasad Dahal

KATHMANDU, June 6 - Many elderly citizens here have died without receiving their elderly allowance because of the government’s failure to allocate adequate budget, President of Kathmandu District Development Committee said here today.

"We have not been able to distribute the amounts required for the elderly citizen allowance in many places of the district because the government has not allocated enough budget," President Rameshwor Phuyal told The Kathmandu Post when asked what was delaying the distribution of the elderly allowance in various parts of the capital city.

An elderly couple - Dip Prasad Upadhyay Dahal and Bhauma Kumari -in the capital’s Kalopul area have been complaining that they have not received any amounts of the allowance since November last year.

Kathmandu Municipality officials, the authorities responsible for disbursing the allowance, said the Dahal couple’s case is just a tip of the iceberg. They blamed the delaying tactics on the part of central authorities as the reason behind their failure to distribute the allowance.

Officials at Ministry of Local Development, however, denied the charge that the government was delaying disbursing funds required to pay allowances. The government has already disbursed the amounts for this fiscal year, said Dal Bikram Kandel, an official at the Ministry, adding that it disburses the funds to local bodies every four months.

"We have many examples of elderly people dying without receiving any amount in allowance," Phuyal said, demanding that the government allocate the budget on time. He also said that the government should "increase the amount in such a way as to help them live on that".

The government through local bodies distributes Rs 150 a month to elderlies crossing 75 years of age, widows and disabled people.

The 1992 census put the population of elderly citizens who have crossed the age of 60 at 1 million 71 thousand 2 hundred and 31. However, according to another data made available by the Ministry the government distributes elderly citizen allowance to only 380,599 elderly citizens. The government has allocated a total of Rs 530 million for elderly allowance for the current fiscal year.

MPs lobby against home minister

By a Post Reporter

KATHMANDU, June 6 - Lawmakers of the ruling Nepali Congress (NC) have appealed the Prime Minister to remove Home Minister Govinda Raj Joshi from office charging him of being unable to maintain law and order in the country.

According to MP Ram Janam Chaudhary, 22 NC legislators including himself have been coercing the Prime Minister "verbally" to depose Joshi alleging that "the state of law and order in the country is in complete disarray and the Home Minister does not also behave properly."

"We have told the Prime Minister that law and order situation cannot improve as long as Joshi holds the post of Home Minister and you (PM) will not be able to live up to the commitments that you made with the electorate," Chaudhary told The Kathmandu Post. "We asked him (PM) to remove Joshi as soon as possible."

He also said that the PM has taken their appeal positively.

Chaudhary accused Joshi of not meeting the MPs and being non-receptive to their problems. The MPs who reached PM’s residence at Baluwatar Tuesday included Ram Janam Chaudhary, Duryodhan Singh, Mangal Prasad Tharu, Kashi Poudel, Sarbadhan Rai, Dil Bahadur Gharti, Janakraj Giri, Damodar Bastakoti, Tek Bahadur Chokhyal and Binay Dhoj Shahi.

Chaudhary added that the MPs are planning to ask for Joshi’s resignation during the NC parliamentary committee meeting slated for tomorrow.

Chaudhary also claimed that the number of MPs going to pressurize the Prime Minister will be increasing in the days to come. "Most of the MPs have gone to their home districts at the moment," he said. "But this number will increase in the days to come."

Koshi hospital services resume

BIRATNAGAR, June 6 (PR)- The three-day-long shut-down called by the doctors at Koshi Zonal Hospital has finally come to an end.

The agreement to resume the hospital services and medical clinics in this industrial town was reached Tuesday noon after the district administration decided to compromise on the conditions put forth by the agitating doctors.

The closure came in the wake of the accidental death of Sudeep Subedi and the subsequent beating of the doctor on duty by the agitated mob late Saturday.

"The deadlock was finally resolved after the meeting comprising Nepal Medical Association (Morang), district and hospital administration unanimously agreed to tighten hospital security and arrest the culprits within three days," hospital in-charge Dr Gyanendra Giri told The Kathmandu Post.

Meanwhile, the hospital and other urban clinic services have been restored to normalcy and the doctors have collectively withdrawn their resignation.

Doctors of the hospital had earlier demanded a tight security cover and a stern legal action against Umesh Yadav who had mercilessly beaten surgeon Dr. Narayan Basnet on grounds of negligence Saturday late night within the hospital premises.