A Nepali parliamentary committee's investigation uncovered significant irregularities and corruption in the construction of Pokhara International Airport, a $216 million project undertaken by China CAMC Engineering Co. The report details how the Chinese contractor failed to meet contractual obligations, including tax evasion, incomplete work, and use of substandard materials.
The inquiry highlights the role of corruption and insufficient oversight by Nepali officials and lawmakers in enabling CAMC's actions. The Civil Aviation Authority's reluctance to challenge Beijing's interests exacerbated the issues.
The airport, funded by a 20-year loan from the Export-Import Bank of China, has become a financial burden for Nepal. The project's failure to meet passenger projections and the looming loan repayment create significant economic challenges.
Pokhara International Airport serves as a cautionary tale about the risks associated with accepting large infrastructure loans from China. The situation underscores the need for greater transparency and stricter oversight in future projects to avoid similar outcomes.
A government inquiry into a new $216 million international airport in Nepal’s second-biggest city found that “irregularities and corruption” by officials and lawmakers allowed a Chinese state-owned contractor to ignore its obligations and charge for work it never completed.
In a 36-page report released Thursday, a parliamentary committee’s investigation into the airport in Pokhara found that China CAMC Engineering Co., the construction arm of a state-owned conglomerate Sinomach, failed to pay taxes, did not finish the project to specification, and used poor quality construction, all because of corruption and a lack of oversight.
In 2023, The New York Times reported that CAMC had inflated the project’s cost and undermined Nepal’s efforts to maintain quality control, prioritizing its own business interests. Nepal’s Civil Aviation Authority, the agency overseeing the airport’s construction, was reluctant to upset Beijing on an important project for both countries, The Times found.
Shortly afterward, an 11-member parliamentary committee started investigating the airport’s construction.
The international airport in Pokhara, a tourist destination at the foothills of the Himalayas, has become a financial albatross for the impoverished country, serving as a cautionary tale about the consequences of borrowing heavily from China for major infrastructure projects.
The airport was built with a 20-year loan from the Export-Import Bank of China, a state-owned lender that finances Beijing’s overseas development work. Nepal must soon start repaying the loan using the profits generated by the airport, which opened in 2023. The airport has fallen well short of its projections for international passengers. There is only one weekly international route landing in Pokhara.
If you often open multiple tabs and struggle to keep track of them, Tabs Reminder is the solution you need. Tabs Reminder lets you set reminders for tabs so you can close them and get notified about them later. Never lose track of important tabs again with Tabs Reminder!
Try our Chrome extension today!
Share this article with your
friends and colleagues.
Earn points from views and
referrals who sign up.
Learn more