NEPAL'S FLEDGLING airline industry is looking for more modern aircraft, in response to market deregulation, growing competition and new regulations forcing the retirement of older equipment.

The number of fixed-wing Nepali carriers has grown to four since deregulation of the country's domestic services in 1992. State-run Royal Nepal Airlines (RNAC) is now forced to compete with newcomers Everest Air, Necon Air and Nepal Airways.

While RNAC for now retains a monopoly on international routes, the Government is initiating moves to revise its bilateral air-services agreement with neighbouring India. Proposals include increasing capacity, adding new carriers and opening up regional destinations.

Nepal's airlines are also being encouraged to re-equip their fleets by a Department of Civil Aviation order requiring the withdrawal from service of aircraft more than 20 years old. The age rule is due to come into force within two years.

RNAC is planning to replace its last two surviving British Aerospace 748s over to next 18 months, according to corporate director T P Gauchan. The airline is looking for a medium-range 50-seat aircraft, offering high performance and the ability to operate from Nepal's 1,200m (4,000ft )-long airstrips.

The flag carrier's more immediate priority is to find a replacement aircraft for its single leased Airbus A310-300, due to be returned to General Electric Capital in May. It has issued a request for tender for a 200-seat aircraft to be either wet- or dry-leased for a period of two and/or five years.

Everest is negotiating with Saab to lease-purchase two 340As. The turboprops are needed to supplement the carrier's unpressurised Dornier 228s and compete against 748s on lucrative scenic mountain flights. Everest wants the first aircraft now and a second by August, says chief executive R P Pradhan.

Necon will probably opt for secondhand Fokker 50s, as replacements for its three 748s, suggests chairman Anoop Rana.

Source: Flight International