Zurich International asks for extension following court order to stop felling trees at NijgadhThe Swiss company, which was supposed to submit a business proposal by March 1, will be developing Nijgadh International Airport on a public-private partnership model.
Following the Supreme Court’s orders to halt the felling of trees at the proposed site of the Nijgadh International Airport, Zurich Airport International AG, which was asked to submit a business proposal for the development of the airport by March 1, has officially requested an extension.
Zurich had been selected as the concessionaire to develop the troubled $3.45 billion Nijgadh International Airport, billed to be the largest airport in terms of area in South Asia upon completion, after the Swiss company outbid competitors, including the GMR Group, an Indian infrastructure giant.
“Zurich requested an extension after the Supreme Court issued interim orders to the government to stop felling trees at the airport construction site,” said Maha Prasad Adhikari, chief executive officer at the Investment Board of Nepal, a high-level government body facilitating foreign investments in Nepal. “The Switzerland-based firm has asked for time until the issue is cleared at the courts.”
The deadline to submit the business proposal for the development of the airport project ended on Sunday.
Although the Investment Board has decided to provide an extension, the decision will only be final once the agenda is tabled at a board meeting chaired by the prime minister, said Adhikari. There, however, is no certainty when the board meeting will convene, as Prime Minister KP Sharma Oli is currently in hospital after undergoing a kidney transplant on Wednesday. Even if he is discharged in a week, doctors say it might take some weeks for Oli to return to regular work due to the risk of infection.
Officials said since the matter is still in court, they cannot say when there will be a final decision.
On December 6 last year, a single bench of Supreme Court Justice Tanka Bahadur Moktan issued a stay order asking the government to immediately stop felling trees at the site. Again, on December 22, a division bench of Chief Justice Cholendra Shamsher Rana and Justice Kumar Regmi continued the interim order issued on December 6.
However, the Investment Board had decided to move ahead and invite potential bidders on the grounds that the court orders only mandated that trees not be cut down, not that all work should come to a halt.
On January 17, the Investment Board formally asked Zurich to submit its business proposal after it was shortlisted in September last year as the sole company to work in a public-private partnership model for the international airport in Nijgadh.
Under the public-private partnership model, the Swiss company will fully fund the project. The cost of the first phase of the development alone has been estimated at $1.2 billion.
The project modality is ‘build, operate and transfer’ under the public-private partnership arrangement. The Swiss firm will propose, in its business document, how long it will operate the airport before handing it over to Nepal.
Nijgadh airport, about 175km from the Capital, is expected to serve as an alternative to congestion and winter fog at Kathmandu’s Tribhuvan International Airport, the country’s sole aerial gateway. The government had decided to develop Nijgadh International Airport, among its most ambitious projects, in 1995.
But the timeline for the airport has been pushed back on multiple occasions amid concerns about financing and legal issues over its environmental impact.
According to an environmental and social impact assessment carried out by the Tourism Ministry in February 2017, more than 2.4 million small and large trees will need to be felled to build the international airport. In the first phase alone, the project will require clearing 769,691 trees on 2,500 hectares. The plan has drawn criticism from various quarters. Environmentalists say that the felling of so many trees will drastically affect the biodiversity of the area. The results could be catastrophic for many animals that call the Nijgadh forests home, they say.
But the Civil Aviation Authority of Nepal, the project executing agency, said that they have reviewed the plan to reduce the environmental impact.
“As per our internal review, the project will use 1,900 hectares in the first phase and will only require cutting down 500,000 trees [135,000 big trees] now,” Rajan Pokhrel, director general at the civil aviation body, told the Post in a recent interview.
The forest ministry will conduct a review and after assessing the number of trees that will need to be cut down as per the assessment, it will table a proposal at the Cabinet seeking approval to cut trees, said Pokhrel.
“We have also identified sites for the compensatory tree planting in Bara,” he said.
The Nijgadh international airport is planned to be the largest in South Asia in terms of area, covering 8,045.79 hectares when completed. The airport will be developed in three phases, with the first phase alone expected to take 10 years to complete.
Once the first phase completes, the airport will be able to handle 15 million passengers annually and accommodate the Airbus A380 superjumbo. By the end of the third phase, the facility will have a parallel runway enabling it to handle 60 million passengers annually. A 76-km Kathmandu-Tarai expressway will link the Capital with Nijgadh.