Tribhuvan International Airport Gives Air Asia X 3 Months to Pay Rs. 400 Million Due

Tribhuvan International Airport (TIA) has given Air Asia X three months’ extra time to pay its dues of around Rs. 400 million, reports The Kathmandu Post.

The Details:

• Air Asia X is a Malaysian-based low-cost carrier that has the highest amount of dues among the domestic and international airlines with outstanding payments to TIA.
• According to officials, the company has asked for some more time and TIA has agreed to it.
• The company has been given the deadline extension because it requested to reconcile its Nepal transactions. The purpose of reconciliation is to provide consistency and accuracy in financial accounts, explaining the difference between competing financial records.
• However, TIA has asked for a bank guarantee for Rs. 250 million by Sunday. If they fail to do so, the operations will stop from Sunday.
• This year Air Asia X saw a sharp 50.69 percent drop in passenger numbers to 43,375 individuals.
• Nepal and Malaysia are connected by Malindo Air, Malaysian Airlines, Nepal Airlines and Himalaya Airlines. The Kathmandu-Kuala Lumpur sector has become an important and competitive route among international airlines connecting Nepal.

Why it matters:

• According to the Airport Service Charge Regulation, if an airline fails to pay its dues by the stipulated time, there is a provision for charging a penalty of 5 percent for 15 days, 15 percent for 16-30 days and 30 percent for the rest of the period.
• In total, the company owes TIA Rs. 270 million in fees and Rs. 130 million in fines.

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