Civil Aviation Management and Regulation

Communication and navigation service charge at international airports (Airport Service Charge Regulation, 2078)

The Civil Aviation Authority of Nepal (CAAN) levies airport service charges under the Civil Aviation Authority of Nepal Act, 2053 and the Airport Service Charge Regulation, 2078. The communication and navigation charge pays for the air navigation services CAAN provides to flights using Nepal's international airports (Tribhuvan International Airport, Gautam Buddha and Pokhara International Airport).

Main features of the charge

1. Purpose: it recovers the cost of air traffic services, radio communication, navigation aids and surveillance (CNS/ATM) provided to the aircraft.
2. Who pays: the operator of the aircraft (airline) using the international airport. It is not a charge on individual passengers.
3. Basis of calculation: it is levied per flight movement, and the amount depends on the weight (maximum take-off weight) of the aircraft and the type of flight, international or domestic. Heavier aircraft pay more. The exact rates are those fixed in the Schedule to the Regulation.
4. Collection: CAAN bills the operator and the amount is deposited in CAAN's account. Unpaid charges can be recovered as a condition of further service.
5. Use of income: the amount is spent on operating, maintaining and upgrading communication, navigation and surveillance facilities.
6. Revision: the rates may be revised by amending the Schedule with the approval of the Government of Nepal.

Candidates should memorise the figures in the current Schedule of the Regulation, because the numerical rates are what examiners ask for.

Prospects and Challenges of Air Transport Development in Nepal, and Suggestions

1. Prospects (3 marks)

• Tourism growth: Air transport is the main gateway for trekkers and mountaineers to remote areas (Everest, Annapurna, Mustang), so rising tourist arrivals directly expand domestic aviation demand.
• Geographical necessity: Nepal's rugged terrain and lack of reliable roads in hill and mountain districts make air service the only year-round means of access to remote settlements.
• International connectivity: Open skies policy, new bilateral air service agreements, and growing demand for labour migration and remittance flows support expansion of international routes and airport revenues.
• Infrastructure expansion: Completion of Gautam Buddha International Airport (Bhairahawa), Pokhara Regional International Airport, and upgradation of Tribhuvan International Airport increase capacity and transit potential.
• Regional hub potential: Nepal's location between India and China offers prospects as a transit and cargo hub for South Asia.
• Employment and allied sectors: Aviation supports jobs in airlines, ground handling, catering, maintenance, and tourism, contributing to GDP.

2. Challenges (3 marks)

• Difficult terrain and weather: Short, sloping runways (Lukla, Jomsom), high-altitude operations, monsoon fog, and wind shear make flying risky; Nepal has a poor aviation safety record.
• Infrastructure constraints: Tribhuvan International Airport suffers congestion, single-runway limitation, and terminal capacity shortfall; many STOL airports lack navigation aids and night-operability.
• Regulatory and institutional weakness: Shortage of trained technical manpower, weak surveillance and oversight capacity, and slow reform in CAAN.
• Financial viability: Small domestic market, high operating costs, expensive aviation fuel, and low load factors make many routes and airlines unprofitable.
• Aging fleet and maintenance: Limited maintenance, repair, and overhaul (MRO) facilities force costly foreign servicing.
• Human resource gap: Pilots, engineers, and air traffic controllers are scarce and often migrate abroad.
• External shocks: Pandemics, fuel price volatility, and political instability disrupt operations and investment.

3. Suggestions to Address the Challenges (4 marks)

• Strengthen safety oversight: Implement ICAO standards fully, conduct regular audits, enforce SMS (Safety Management System), and adopt a just culture in incident reporting.
• Upgrade infrastructure: Install RNAV/GNSS approach procedures, runway lighting, and weather monitoring at STOL airports; expand TIA capacity and complete second-runway works.
• Develop human resources: Establish a national aviation training academy for pilots, ATCOs, and engineers; provide scholarships and retain talent through competitive pay.
• Improve financial sustainability: Rationalize route subsidies for remote districts, encourage public–private partnership in airports and MRO, and review fuel pricing and taxes.
• Promote competition and connectivity: Negotiate more bilateral rights, attract foreign carriers, and develop Pokhara and Bhairahawa as alternative international gateways.
• Enhance regulatory capacity: Strengthen CAAN's technical and financial autonomy, separate regulatory and service-provider roles, and digitize licensing and surveillance.
• Adopt modern technology: Use satellite-based navigation, drones for remote delivery, and digital ticketing and cargo systems.
• Ensure sustainability: Integrate environmental safeguards, noise management, and climate-resilient airport planning.

In conclusion, Nepal's air transport sector has strong prospects rooted in geography and tourism, but realizing them requires sustained investment in safety, infrastructure, human resources, and regulation. A coordinated effort among CAAN, the government, airlines, and private investors is essential to convert these prospects into reliable, safe, and economically viable air services.