Aviation experts say high taxes on aviation fuel dissuade international airlines, which magnify downstream benefits to Nepal’s economy through tourism promotion, cheaper travel for Nepali migrant workers, and by making air cargo competitive.
“The way to make money from airlines is to encourage cheaper flights so there are more tourists. It is counterproductive to squeeze carriers through higher fuel costs and airport fees,” says the representative of an Asian airline.
Besides fuel costs, charges for ground handling, parking and landing fees are also costlier in Kathmandu than in other South Asian airports. A widebody operator with 290 passengers pays $6,000 for ticketing and ground handling per flight at Kathmandu airport, which is twice the cost in New Delhi or Bangkok. Landing and parking charges in Kathmandu are $2,800 for heavies like the A330 or B777, which is 20-30% higher than other airports in the region.
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“Kathmandu has the highest cost among all the airports in our network, but in return we get poor quality of service and bad infrastructure,” said an airline source, who did not want to be named because he was not cleared by headquarters to speak to the media.
He added: “The automatic doors on ramp buses don’t work, the airport is overcrowded and inefficient, but we take that as given. We just wish there is better communication and ample notice from CAAN and the airport management about disruptions.”
Nepal Airlines Deputy Managing Director Ganesh B Chand maintains ground handling charges for widebodies are the same in Kansai as in Kathmandu, adding: “Our costs are high because the taxes for ramp buses and other equipment make them five times costlier than in Delhi.”
Conclusion: operating costs for airlines at Kathmandu airport is the highest in the world because of abnormally high taxes needed to subsidise domestic air travel and the public’s use of LPG cylinders.
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