The Tourism Ministry has assured the Asian Development Bank (ADB) that it will tabled the new Civil Aviation Act at the Cabinet by October.

The new Act will split the Civil Aviation Authority of Nepal (Caan) into two entities—regulator and service provider. Splitting of the Caan, which is among the components of the Air Transport Enhancement Project under $4.2 million ADB funding, is aimed at facilitating stringent enforcement of safety measures.

Caan has been functioning both as a regulator and a service provider from the same office, and there is no clear demarcation between its duties and organisational structure. “Delay in approving the new Act has been hampering improvements to address current safety issues and capacity constraints,” said Kenichi Yokoyama, ADB Country Director for Nepal, speaking at the second 2016 Tripartite Portfolio Review Meeting held here on Thursday. “The ministry should fast-track the process to pass the new Act.”

According to the ADB, the capacity development support is to ensure clear functioning air transport regulations and operations entities to be established through the bifurcation of the Caan for self-sustained improvement of air transport.

“The amended bill will be tabled at the Parliament after the Cabinet’s go-ahead,” said Suresh Acharya, joint-secretary at the ministry.

The government has been working on the new law for the last seven years. Ministry officials said if things go as planned, the new Act will come into effect by early 2017. The new Act will replace two existing Acts—Civil Aviation Act 1959 and Nepal Civil Aviation Authority Act 1996.

The International Civil Aviation Organisation’s (Icao) Universal Safety Oversight Audit Programme has recommended that Caan be split to make the aviation sector more efficient.

The new Act will integrate the previous Acts to eliminate conflicts and contradictions between the Caan and the Ministry of Culture, Tourism and Civil Aviation—a situation that has been slammed in safety audits conducted by global aviation bodies.

“A new Act has also become necessary as per the changing context as the old laws do not cover all critical safety oversight issues,” said a Caan official, adding they do not provide a clear legal basis for inspection, regulation and certification in Nepal’s civil aviation industry as pointed out by the Icao and other aviation bodies.

The Icao has expressed grave concerns about Nepal’s air safety, and has placed it among the 12 worst performing nations in the world, which are Botswana, Kazakhstan, Congo, Sao Tome and Principe, Angola, Djibouti, Eritrea, Haiti, Lebanon, Malawi and Papua New Guinea, according to an Icao report.

Nepal has been red-flagged on “operations” among the eight critical elements. In August 2013, Icao identified a significant safety concern with respect to Nepal’s ability to properly oversee the airlines under its jurisdiction.

On December 5, 2013, the European Commission had put Nepal on the European Union air safety list as it found it lacking the ability to oversee aviation safety issues.