‘Government should have maintained an alternative way to import essential goods’
Just before the arrival of the festival and tourist season, the domestic airline sector is facing shortage of Aviation Turbine Fuel as a result of the ongoing protests in the Tarai region of the country. This is a time when passenger movement goes up significantly and generally compels operators to increase the number of flights to different parts of the country. Ramesh Shrestha of The Himalayan Times spoke to Rameshwor Thapa, President of Airlines Operators Association of Nepal on different issues including the fuel crisis, ticket booking for Dashain and flight operation plans, among others. Excerpts.
The domestic airline sector that was gradually picking up after the earthquake has again faced a problem. How do you evaluate the situation at the moment?
There was a drastic decline in the movement of passengers in domestic and international flights after the April/May earthquakes because of the fall in arrival of tourists and people being scared to come to Kathmandu from different parts of the country. We were just starting to gradually come back to normal and the protests against the constitution started in the Tarai. This has portrayed Nepal’s image among potential international visitors as ‘scary’ due to which the number of tourists visiting Nepal has come down as safety is the prime concern of any tourist. After the promulgation of the new constitution, there were expectations that things would be better and this was even reflected in the stock market and travel advisories. However, the unrest in the Tarai has continued affecting surface transport. It resulted in blockade in supply of essential goods including fuel. The main business season is starting very soon but due to the continued strikes the number of cancellations by tourists has increased. Of the total annual average passenger movement of 700,000 to 800,000 in domestic airlines, more than half of the business is done during this season.
What do you say about the current crisis of Aviation Turbine Fuel (ATF)?
There is a big problem of fuel shortage due to the blockade. The Civil Aviation Authority of Nepal has also issued a notice asking international airlines to carry enough fuel to return from Nepal or get the aircraft refilled on the way to Nepal. We, domestic airlines, too have been preparing to operate flights in an economic way to save fuel and merge flights where possible. At the same time the country’s biggest festival is just a few weeks away when normally demand for air service goes up heavily. It may be because of the current situation of the country that we have not felt any pressure from passengers like in the previous years. We have taken the current situation as an emergency and an alarming one.
What will the scenario be like if the situation does not improve anytime soon?
Obviously, if there is no supply, the situation will get worse. Actually, we never thought that India would stop supplying essential goods to Nepal going against international law. And, I think the government had not imagined of this type of situation either. The situation resulted due to some political reasons and the unrest in the Tarai. India has also said that it has not able to ease supply due to the ongoing protests in the Tarai. It would have been better if the government had maintained an alternative way to import essential goods including fuel from China to ease supply when there are such problems or temporary closure of border points during special occasions like elections in India. I think we do not have any policy or strategy so far to deal with such types of situations.
Movement for Dashain is all set to start soon. How is the situation of air ticket booking?
Ticket booking is going on. We are hopeful that the current situation of fuel shortage will not last for a long time. Discussions on how to use the stock that Nepal Oil Corporation (NOC) currently has in an effective way, economising fuel use, and other alternative means are also going on among stakeholders including Airlines Operators Association of Nepal, Ministry of Culture, Tourism and Civil Aviation, and NOC. We believe that high level government officials are also working seriously towards ending this problem.
NOC has also instructed domestic airline operators to refill their aircraft at airports in the Tarai to save fuel in Kathmandu. What do you have to say about it?
Not all airports in the Tarai have the capacity to maintain stock. Only the airports of Bhairahawa, Biratnagar, Nepalgunj, Dhangadhi and Jhapa have fuel facility. But the main thing is that those airports too must first receive fuel. They will also not get fuel until the border is open and refilling from these airports can just be a temporary solution till the time that they have stock. Since the Minister of Commerce and Supplies is all set to leave for India on Monday, let us hope that the supply situation will improve and there will not be any difficulties during Dashain.
Could you please share about the contribution of the movement during Dashain in the annual turnover of domestic airlines?
We do not have any exact data. Normally, as it is also the tourist season, the flow of passengers goes up by 15-20 per cent as compared to the average flow of passengers. In sectors like Lukla and Jomsom, the number of passengers increases by as much as 50 per cent during this season. Due to the increase in demand, airline companies also feel the pressure to increase the number of flights. There is a problem in surface transport due to the strike in the Tarai and demand has gone up for air service but let us see what happens to the fuel supply situation. We have a plan to provide maximum service as per demand during the festival time and even operate night flights to airports where facility for night service is available.
Could you please tell us for how long domestic operators will be able to provide service if the fuel supply problem continues?
We will be able to provide service for a maximum of 15 days if the supply situation remains the same. We have been discussing with government officials informally regarding the current situation. The fuel shortage would have an adverse impact on the domestic airline companies that have invested over Rs 16 billion. There are also complaints regarding domestic air service providers charging higher for chartered flights.
Is there any plan for a review?
Chartered flight service basically means negotiations between two parties and their agreement to give and take service at an agreed amount. If a party approaching any airline company to avail chartered service is not satisfied with the price that has been quoted then the concerned party has the option to go to other operators. It is a kind of competition among operators. So, it has not been regulated till date and should not be regulated in the future too. We have not charged higher fares for scheduled flights. On scheduled flights, there are two types of fares — upper limit and lower limit. We have so far not reached the upper limit fixed by the government.
‘I would rather quit than take back the decision of sending workers abroad under free visa and ticket rule’
What do you have to say about the ongoing protest of manpower agencies?
As I myself was previously involved in the foreign employment business, I know where things went wrong in the past. The free visa and ticket provision for the seven countries has been implemented after doing the required homework and consultations with labour ministers of the concerned countries. We also held discussions with Nepali manpower agencies. The seven destinations have over 2.5 million Nepali workers and they are also the countries where workers have faced more problems. Definitely, new rules will reduce the income earned by agencies as they used to charge higher fees from outbound workers by just sitting at their offices and paying commissions to sub agents. It might take a maximum of three months to see things getting back to normal to send workers under the new provision which is good for outbound workers as well as for agencies who are transparent in doing business.
But manpower agencies have stated that they will not send workers until the government rolls back the decision or keeps it on hold for some time for additional study through a high-level commission. What do you have to say?
They are in protest and have even demanded my resignation. But as the decision has been taken after extensive preparations and consultations with Prime Minister Sushil Koirala and other top political leaders, we will not go back on our decision. Agencies should promote the potential of Nepal and deal directly with employers who provide free visas and tickets to workers and commissions to agencies directly. Under this provision, agencies can collect up to Rs 10,000 as service fee and this is what the agencies want us to increase. Basically, we want to control the expenses being borne by workers and the commissions being sent illegally by agencies to agents abroad. About Rs 40 billion to Rs 50 billion that is currently being sent annually as commission to agents abroad through non-banking channels will be blocked by this new provision.
Since Nepal has already been able to create a name for itself as the best labour supplying country, isn’t there a risk of labour shortage in the domestic market if this new provision attracts more Nepalis to foreign employment? Moreover, the government is also preparing to send female workers at free of cost as domestic helps.
Nepal has a good brand name when it comes to supply of workers. But due to the bad competition prevalent, there were instances whereby agencies brought in demands for any kind of work by paying a commission to agents in labour destination countries and workers were being sent at fees that were higher than what the government had permitted. This is one of the reasons why we find Nepalis facing enormous difficulties. Once the new rule is fully implemented, the trend of sending workers only to big and reputed companies agreeing to fund all the costs required to hire workers will increase, whereas demand from small companies that cannot fund hiring expenses will come down. This means less number of workers will be able to go for work. The decision of free visa and ticket was introduced taking into account the possible shortage of workers that the country could face during the reconstruction works in the country.
Do you mean to say that the quota for Nepal will come down?
As all the demands from the seven countries will require free visa and ticket facility for workers, this will reduce the quota and it will be beneficial for outbound workers. It is better to send 40 workers under this provision than sending 100 workers as per the old provision. Of the total demand being received by Nepal, 20-30 per cent have facility of free visa and ticket but manpower agencies are charging as high as Rs 90,000 from outbound workers. Expenses of manpower agencies have gone up mainly because they are paying commissions to four-five sub-agents by just sitting in their offices without doing any marketing. Those agencies which cannot abide by the new provision should be shut down. There are many other agencies that have welcomed our decision. Based on the new provision, we will also start marketing and promoting Nepal’s potential in the seven destinations along with agencies and journalists.
There are allegations that you imposed the new provision based on the interest of Bangladeshi manpower agencies and Malaysian companies that want to implement bio-metric medical test. What do you say about it?
The new provision was introduced solely for the benefit of workers and to help develop a proper system in the foreign employment sector which is in a mess at the moment. I have the support of the general public. I am clean and I am ready to face any allegation when working for a good cause. I challenge those who accuse me of working as per the interest of Bangladeshi companies to come forward with proof. Even the prime minister called me two to three times and enquired on whether the new provision was implemented without proper preparations. I informed the prime minister about the homework that we had done before bringing the new rule. If I do have a personal interest in it then definitely it will be exposed one day. If this decision is going to really hurt the sector as some people say then it can be changed later on. Countries like Qatar, Saudi Arabia, Kuwait and Israel have been showing interest in implementing ‘government to government’ approach to hire workers, instead of involving manpower agencies.
What will be the next step if manpower agencies continue with their protest and it starts affecting foreign employment and those who are already in the process to leave for jobs?
We have already invited manpower agencies for talks. Informally, they have agreed to sit for talks only if I resign. There is no option other than mobilising the security forces if the obstruction in the regular work to send workers continues. Issuance of final approval for workers has been affected and workers who were supposed to leave for jobs have been stranded due to the ongoing protest. Before July 6, the date when the new provision came into effect, the government had issued 92,000 pre-approvals. So, manpower workers right now should concentrate on getting final approvals and sending workers as per the old provision first than making baseless allegations against me. I am confident that there will be no political pressure on me to withdraw the decision. And doing so would make the poor people who have been eyeing foreign employment unhappy. I do not have any personal interest in implementing this provision. There is no possibility of taking back this decision. If there is undue pressure and I have to withdraw the decision then I would rather quit this job and return to my private life.
What do you say about the possibility of illegal departure of general workers via India?
Mainly this is a risk related to female aspirants leaving for jobs as domestic workers. As we are preparing to send such workers under the new directive, the trend of illegal departure via India will get discouraged. As per the plan, workers looking to go abroad as domestic helps will be sent only if the employers agree to provide a minimum salary of $300 per month in Middle East countries. Workers will be first sent on a trial basis for nine months and after that such workers will be sent to only those countries that sign a memorandum of understanding with Nepal.
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When it comes to implementing national pride projects, there has always been slow progress due to multiple problems, including land acquisition, lack of coordination among government agencies and government apathy. The Mechi-Mahakali Electric Railway, also known as East-West railway, is one of the 21 national priority projects that aims to connect Kakarbhitta in the east with Gaddachowki in the west. Ramesh Shrestha of The Himalayan Times spoke to Ananta Acharya, Director General of the Department of Railways, the implementing agency of the proposed electric railway project regarding low progress, problems and planning for next fiscal year. Excerpts:
Why is the progress of Mechi-Mahakali Electric Railway so sluggish?
It is a mega project and despite being a national pride project, we aren’t getting support from other governmental agencies to speed up work related to it. We have limited staff and there’s also lack of training for capacity building of officials, as railway development is new to us. Basically, we are in a phase of preparing detailed project report (DPR) of different sections. And, we’re hopeful that we’ll be able to spend around 80 per cent of the Rs 1.4 billion budget allocated for the current fiscal by year-end.
So what is the status of development so far?
We completed DPR preparation of Bardibas-Simara section, the segment of the East-West railway that holds the most potential. Based on the target of the government, we’re all set to start construction of the track bed, a basic work for laying railway track in five-km stretch in Bardibas-Simara section. Moreover, we’re preparing to hire contractors for track bed construction of around 25-km stretch of this section. DPR study of Tamsaria-Butwal is in the final stage and Simara-Tamsaria section’s DPR has not moved ahead effectively due to a dispute regarding alignment that passes through the Chitwan National Park (CNP) area. Recently, the park officials asked us to stop all works regarding survey citing biodiversity issues.
CNP authority says that since the park is a protected area, the development of railway alignment through it will have a negative impact on endangered animals and environment there. What is your say?
In a way, development is not possible without destruction. But, by that I don’t mean that we aren’t concerned about preserving the park and biodiversity. We feel as accountable for safeguarding the park as the CNP authority. We are planning to build a railway network through the park while keeping any adverse affects to the surroundings to a minimum, on the basis of the feasibility study. Now, we are not being allowed to carry out DPR study there. Earlier, the park authority had suggested we also explore other alternatives, but had allowed us to carry out the survey. This shows that there is lack of coordination among the government agencies while carrying out big projects.
Do you mean to say that there is no alternative for linking Simara with Tamsaria?
No, that’s not what I mean. However, the proposed alignment is more feasible and requires comparatively low cost for development. I think this issue wouldn’t have come up if the feasibility study and proposed alignment were discussed with the concerned stakeholders well ahead. There is also pressure from political party leaders and locals to change the alignment in Butwal and Bardaghat of Nawalparasi saying that the alignment is too close to the highway. If the same problems persist and there is non-cooperation, frankly, I don’t see any point in carrying out this project.
What should government do to speed up the project work?
Problems related to big projects need to be addressed from the prime ministerial level. We are likely to face problems in track bed construction as contractors are supposed to collect 80 per cent of construction materials like stone and soil from local rivers, as per the contract signed with them. Many rivers also require environmental impact assessment (EIA) to dig soil there. Bardibas-Simara alignment also passes through a protected forest area. Since the railway project is a huge national project, there must be support from the general people, political parties and other government offices to resolve problems, mainly related to land acquisition and alignment dispute. Everyone should realise that the whole concept of the project is to develop a cheaper alternative mode of transport.
Since you are also the new chief of railway department, what will be your focus?
As I told you earlier, we’ll be intensifying track bed construction and starting work to build bridges that are also a major part of the whole project. It will take a maximum of five years to complete track bed construction in Bardibas-Simara and its link Simara-Birgunj. Contract for 5-km track bed construction has already been signed and contractors are expected to start work before monsoon starts.
If the government is taking five years only for track bed construction of a section, when can we expect the project to be completed and the railway service to begin?
It’s hard to say when project will be completed. I said five years for track bed construction of Bardibas-Simara based on the current working style. If the government allocates enough funds and prioritises construction, we’ll be able to expedite the track bed construction, completing at least 100-km within a few years. Then we will have to award contract for railway network construction like track, sub-station, etc. Since India is helping to extend Janakpur-Jayanagar railway up to Bardibas, we have been giving first priority to Bardibas-Simara section.
'Let's first focus on 3G experience before going for 4G'
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| Ananda Raj Khanal, officiating chief Nepal Telecommunications Authority |
Why hasn’t NTA Board been able to hold meetings?
We haven’t been able to hold the board meeting due to ongoing strike by NTA employees’ union who are demanding that the MoIC give concurrence to staff’s facilities as was proposed by the NTA. The deadline for renewing NT’s mobile permit is also nearing and I’m hopeful that at least the decision regarding it will be made soon.
What are the demands of NTA employees’ union and are they genuine?
Since I’m also a beneficiary of their demands, I may be biased in my opinions. But after the MoIC gave a go ahead with small modifications, I personally feel the union should have relented and taken up the issues again in the next fiscal.
The union said that the MoIC intervened in autonomy of the NTA. Is it so?
Yes ... people have this opinion. But, we have to ask — does the NTA exist in isolation?
If not, it might not be fair to allege that the government is intervening. There’s nothing wrong with the NTA’s annual programmes needing MoIC’s nod. But requiring government approval for salaries, benefits and organisational structure of the NTA could raise these questions because autonomy is also related to these issues.
NTA is accused of being weak in regulating its licensees. What is your say?
There’s no point in denying that the NTA has been a very weak regulator. NTA hasn’t been able to perform its activities based on the term of reference given to it as per Telecommunication Act. We’re focusing only on facilitation. There’s a need of re-engineering in structure and a paradigm shift in the whole organisational development. We can’t regulate the vast telecom sector with this kind of structure.
Why is NTA not auctioning high value spectrum?
Let’s evaluate this from a different perspective. I don’t think there is real demand for 3G spectrum because two major operators — NT and Ncell — who already have 3G spectrum, are deploying services aggressively. The remaining four operators are ineligible for 3G service as per the spectrum policy. It’s already been a year since Smart Telecom acquired unified licence, but it hasn’t been able to roll out the services due to their internal problems. United Telecom Limited (UTL) hasn’t claimed its unified licence so far. We’d planned to auction 3G spectrum after issuing at least two unified licences.
Why hasn’t UTL taken unified licence till date?
It could be their business decision. They’ve said that they’re waiting for full verdict from the Supreme Court, which we expect within next week — although it has already given a go-ahead to the unified licence regime. The NTA’s priority is to bring all operators in equal level playing field. We also know that there’s no market for six operators, with liability of Rs 20 billion licence renewal fee. That’s why we also have a merger and acquisition policy or regulation in the pipeline. The main thing is that we don’t have a chairman and a post of a member is also vacant at present. We need a full fledged board with a chairman to be able to make decisions with long-term impacts.
What about the 4G spectrum?
Ncell and NT have asked for it, but let’s look at their 3G services first. The 3G should reach at least major cities of the country and people should demand more bandwidth in mobile. Only then can we say that we’re ready for 4G. I don’t think it would be a mature decision to assign spectrum just to boast that Nepal has launched 4G. There are no mobile broadband services for 4G. So, we’ll have to wait for some time.
But isn’t it up to the operators’ to decide what type of services to offer? Besides, won’t the delay in assigning spectrum mean revenue loss for the government?
Yes it would’ve generated the revenue. But, if there is no demand and no good supply, how will the operators make profits? Not every other country in the world has 4G. Even in India, it’s been deployed recently and the response has only been lukewarm. Let’s first focus on the 3G experience before going for 4G. Our first priority is migration of telecom operators’ permit to unified licence.
http://thehimalayantimes.com/fullNews.php?headline=%27Let%27s+first+focus+on+3G+experience+before+going+for+4G%27&NewsID=413736
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'Truth will be revealed when we get
investigation results'
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| Jayaram Lamichhane, President of Federation of Contractors' Association of Nepal |
What are the reasons for the collapse of Sunkoshi bridge that was under construction and delay in its completion?
Bridges like Sunkoshi and Bheri are considered ‘chronic’ in our country. As far as I know, the delay in construction of Sunkoshi bridge is due to change in its design time and again by the government, while the contractor might also be responsible. But the government was primarily at fault because the first design of the bridge was not feasible for that location. It took over six years to prepare a new design and get it approved, resulting in the delay.
As for the collapse, initial reports suggest that a heavy windstorm and lightning strike at the same location affected the temporary supports for the bridge. As it was a steel truss bridge, it was yet to be fitted fully with nuts and bolts for full strength. The bridge might have collapsed mainly for two reasons — first, the carelessness of contractors to give good temporary supports to the steel truss and secondly, due to the windstorm and lightning strike. I think truth will be revealed when we get the investigation results from the government team.
In terms of quality, Nepali contractors are also criticised of providing poor output. What do you have to say about it?
Contractors are responsible for giving quality work while abiding by the given cost and project deadline. And, those failing to do so should not be allowed to work as contractors. When talking about quality, there are many reasons for low quality in construction of projects, and low bidding is a major one. The government has to take action if a contractor is found to be involved in constructing low quality infrastructure project. The government should also compensate the contractor if the project gets delayed because of lack of necessary support from the government. Though there is no provision as such yet, the state should take action against engineers coming up with inappropriate designs.
You said that low bidding is one of the main reasons for low quality in projects. Could you elaborate on it?
The existing Public Procurement Act says that a project has to be assigned to a contractor placing lowest bid, which is the biggest mistake. Hence, 17,000 contractors are forced to bid at low price while cutting corners. Even a project that is estimated to cost Rs 100 million by engineers are being developed at Rs 30 million. The government needs to make sure that the contractor bidding the lowest price has the capacity to invest fully in the project so that in case the contract amount is insufficient, the contractor can still complete the project. It has been awarding the project to any company placing the lowest bid without checking its capacity. For this, the existing procurement Act needs amendment. We have demanded that the government make changes in the law to award contract based on average bidding cost, rather than the lowest. This has been the best practice in South Korea too.
As the umbrella organisation, what plans does FCAN have to motivate contractors in giving quality output in infrastructure projects?
I can’t take responsibility of all, but I assure you that 90 per cent of contractors of the country follow the principle of completing contract with quality performance within stipulated time. Delay in completing the project means increase in cost too, so construction companies don’t want to prolong it and spend more resources. If any contractor delays project intentionally, its licence must be cancelled. The government should also blacklist it and seize the bank guarantee. We have also circulated this message to all 75 districts. The government too should ensure conducive environment at the project site. Normally, locals start protests only after contractors reach the site. This type of common problems also pushes the project completion date back.
What is happening regarding full implementation of the 45-point agreement reached with the government?
The agreement reached four years ago had decided to end the practice of seeking pre-qualification for carrying out project costing up to Rs 20 million. But, so far, the government has not been able implement it. Similarly, the trend of handing over small projects costing up to Rs six million to consumer committees had to be cut down. We’ve demanded that the government give small projects worth up to Rs 500,000 to such committees so that some 16,000 small contractors also get projects. But what’s happening is that based on the political interest, even projects worth Rs 60 million are being divided into 10 parts to assign them to consumer committees. If the government continues to neglect our woes, we will launch a protest, for which, a struggle committee under my coordination has already been formed.
- See more at: http://thehimalayantimes.com/fullNews.php?headline=%27Truth+will+be++revealed+when+we+get+investigation++results%27&NewsID=411601#sthash.bJWIILe4.dpuf
NT will cut 1,500 jobs in next 2 years
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| Anoop Ranjan Bhattarai, Managing Director, Nepal Telecom |
It has been 10 years since NT went public. How do you evaluate these 10 years?
We have witnessed a significant change in NT in the last 10 years as the company was restructured. NT has evolved into a matured institution ready for any competition in the market and regularly catering to the needs of the customers. This has resulted in growth in the number of subscribers as well as income.
NT’s service quality has remained poor. Perhaps, voice quality is NT’s biggest weakness. How do you plan to address this issue?
There used to be a problem of call failure until three weeks ago, forcing customers to dial up to four-five times. This problem has now been resolved. I agree there are complaints such as no call success, call break and disturbance. Generally, users experience these problems in areas where our signal strength is week. In the last few weeks, we have identified such locations where we will be installing 60 base transceiver stations. I believe this will surely reduce the problems.
Two-three telecom companies are planning to enter the GSM segment which would heat up the competition. How do you plan to steer NT in a competitive environment?
NT will give priority to data service as we believe there is a huge scope to grow. There is no doubt that data is a key segment for telecom companies. Currently, we have data services under WiMax, GSM and CDMA categories. We are coming up with two new services—WiFi and Fibre to the Home (FTTH). We have completed installing equipment in eight core areas of Kathmandu, making available the FTTH service. In the first phase, we will be focusing on core business areas and housing and colony locations. We hope to cover all district headquarters with WiFi within this fiscal year. Data consumption in Kathmandu has increased 60 percent after we improved 3G service. More customers are buying our 3G data packages as they are comparatively cheaper. Data service mainly helps increase average revenue per users. Once our 3G network goes nationwide, we hope to see our revenue going up remarkably.
Prices of voice service have come down significantly in the last five years. Will it go down further?
Voice has already started to become a secondary service for subscribers having access to data as it also enables voice calls through applications like Viber. We think voice service should be free. We recently launched a scheme to CDMA users under which customers paying only Rs 20 a month can make as many as calls they want during night time 10:00 pm to 6:00 am. It is a kind of free voice service and I think, if the same trend continues voice service in a way, will be free service within next two years to customers buying other services.
Where has the plan to bring a strategic partner in NT reached?
The government has intensified the process. We will float an expression of interest within a month to hire a consultant for two tasks—prepare the request for proposal for a strategic partner and carry out NT’s evaluation. To make NT an attractive partner, we will also be restructuring it. Since it will take two years to bring in a partner, we will be launching new services as per the need in 2015 and 2016 with a new network, besides brining NT in a good shape.
Do you mean NT is laying off employees under the restructuring plan?
Yes, the number of employees will come down. We will be launch voluntary retirement schemes and all the departments will be transformed into business units for effective operation. Each unit will be able to carry out marketing and promotional activities itself to increase revenue. As per our restructuring plan, I think we will be able to reduce 1,500 employees in next two years. In a bid to enhance employee performance, we have also started signing performance contract with deputy managing directors and project managers. We are hiring a consultant to evaluate the performance of employees, starting from peon to managing director, and offer incentive under the performance-based incentive system as per our bylaw.
NT has long been planning to diversify its investment, what is happening on this front?
A study to this effect is under way. However, I think we should first focus on our own service areas than thinking beyond. I have a plan to open a company for managed service which can also work on installation and maintenance of telecom service networks of other operators as well. There is also possibility of opening a software company, which can develop local contents for internet users. This will help reduce internet bandwidth costs going abroad. We plan to launch a local networking site which will also contain videos.
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We have to serve customers even better to stay ahead
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| Johan Dennelind, President and CEO of TeliaSonera |
It’s been six years since TeliaSonera entered Nepal. How do you evaluate Ncell’s performance over the period?
I must say, it has been transforming not only for TeliaSonera and Ncell, but also for many aspects in Nepal. Ncell has been a catalyst for taking telecom penetration to over 50 percent. And, it has also done well financially. We have invested a lot of money in networks and those investments also go back to customers as corporate social responsibility. So performance has been really good, but that is not enough. Now we need to look ahead and strengthen ourselves even more.
Would you please tell us why TeliaSonera sold its stake in Nepal Satellite Telecom?
One of my first decisions was to exit Nepal Satellite because I wanted to focus on Ncell. Ncell is our star and we need to focus our energy, investment and management capacity on Ncell. So that was the background for the decision.
With the Nepal government coming up with unified licence, new operators are also coming in the GSM mobile segment. This is expected to heat up the competition. What would be Ncell’s strategy amid increased competition?
We think competition will increase and it is increasing already now. But it will intensify going forward so we will be telling Ncell and Erik (Erik Hallberg, president of Business area Eurasia who was also present during the interview) to invest in the business and to make sure that we are prepared for competition. It means we need to serve our customers even better. We need to reach more places. Whenever there are complications and changes, we should be ready.
The demand for broadband internet is growing in Nepal. How Ncell will cater to this growing demand?
I think we’ve been able to meet the customers’ demand. Just to give you an example, I met a young person here three weeks ago and I talked about how much do they spend and how they (the new generation) are using the internet. He said he is using it almost every day. That means the internet or mobile data is important. We need to make it affordable for everyone in one way or the other. Price is already coming down gradually and if we do not make it affordable, they will not buy it.
Ncell has been ranked as one of the best performing brands in the Eurasia region. What do you think made Ncell one of the best performing brands under TeliaSonera?
In my perspective, the Ncell team has been very passionate in developing Ncell as a brand. And, it has paid off. The next phase will be different, especially how we develop the brand and move forward. Ncell is now very known brand in Nepal. With this comes great responsibility and that is to care for the brand and develop the company.
TeliaSonera is being run under a new model from April 1, 2014. What should a customer expect from this change, especially in Nepal?
I would say that Ncell, in many aspects, is already running according to new model because it’s the local mandate, where we infuse, inject new practices where we see need for it. The new model also wants us to learn better from Ncell to bring experience and learning into other companies. In many areas, Ncell is our best performer, so we hope to learn more from Ncell in the new model.
The Nepal Telecommunications Authority has come up with draft paper which says private telecom companies should go public. Is Ncell ready for this change?
I think it is good that the government is thinking ahead for the industry and nation. We are ready to be part of such a discussion and we are open to such discussions and suggestions. We have seen in other markets where we operate that public offering can be a way to broaden your ownership for a company. We are curious to find out more and I would be looking for dialogue here. We have done it in other companies already. We did it in Kcell, Kazakhstan, last year.
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IT industry mainly driven by private sector
President, Computer Association of Nepal
KATHMANDU, JAN 2--CAN Info-Tech, the country’s premier information technology (IT) event, will be entering its 20th year on Thursday. Ramesh Shrestha from The Kathmandu Post talked with Binod Dhakal, president of the Computer Association of Nepal (CAN), about the 20th edition of CAN Info-Tech, the status of the IT industry in the country and its future. Excerpts:
This is the 20th edition of CAN Info-Tech. How would you review its history spanning the last two decades?
Started in 1995, CAN Info-Tech is undoubtedly the pioneer in developing the IT sector in the country. The fact that CAN Info-Tech has been transformed into a national event with a huge number of people visiting it annually shows that there is tremendous interest in IT. And the credit for this goes to the previous executive committees of CAN. We’ve witnessed significant changes in the domestic IT sector in the last two decades which is mainly driven by private sector.
Our IT industry is predominantly hardware driven. Our IT companies are yet to come up with products that can be sold globally. What would be the areas where Nepal can show its presence on the global IT map?
There is huge potential for developing Nepal as a destination for IT services like business processing outsourcing (BPO) and software development. Many local companies are now doing BPO related work. This indicates that Nepal has possibilities mainly in the BPO sector to earn foreign currency and generate more employment opportunities in the local market. However, the government should come up with flexible policies like waiver of capital gains tax, tax holiday or other incentives to promote BPO. This will help encourage Nepali companies and international companies to invest in Nepal.
So you mean to say that the existing IT policy is discouraging?
Well, there was a revision of the policy in 2012. The policy, as such, is fine for the development of the sector if you go through it. But the government has failed to come up with plans based on the policy to take the sector ahead. It has remained as just another policy of the government lacking an integrated action plan. The government was supposed to devise short- and long-term action plans. When it comes to economic development, we always talk about agriculture, tourism and remittance; but if the government pays a little more attention, IT could be the number one sector for the overall development of the country. It can be applied in many sectors like agriculture, education and health.
Coming back to the annual Info-Tech, what is new this year?
New products and services are of interest every year. Basically, Info-Tech is the only event where you can see, touch and feel the developments taking place in the sector at the local and international levels. The huge response we have been receiving from visitors also reflects how much the people are concerned about IT as it has now become like a part of their daily lives. People get more information about the services and products they want and even buy products on the spot. This year, amid increasing impact of mobile phones on daily life, we will also be organising a conference about mobile technology and society. Local and international experts are scheduled to present papers about mobile technology.
Could you tell us about the investment made in the sector, its contribution to the economy and the employment generated?
The technology is connected with every sector in the country and at the household and individual levels, so it is clear that this is a big sector. But it is also a bitter fact that neither the government nor CAN has any data about the amount of investment in sector and its contribution. We are planning to conduct a survey within a year which will, in a way, at least show the shape of the IT scenario in the country. A memorandum of understanding to this effect has been signed with a company to do the survey.
Of late, it seems that the government’s focus on the IT sector is going down. Don’t you think that it should be proactive to promote this sector?
The dissolution of the High Level Commission for Information Technology (HLCIT), a body which was dedicated to the IT sector, was the most tragic episode in Nepal’s IT history. It was building international relations and slowly moving ahead for the development of the sector. Also, there was a dispute in the past regarding which ministry should oversee the IT sector. It has now been resolved with the Ministry of Science, Technology and Environment being assigned the responsibility. However, it is still not clear whether the Communications Ministry or the Technology Ministry governs the IT sector. When it comes to policy-level issues, it is related with the Technology Ministry, but in practice, ICT is under the Communications Ministry. When a donor wants to support the government, they don't know which ministry they should approach. It is a fact that no project has come to support the sector. Now, the new government should clearly differentiate the jurisdiction of the two ministries with long-term vision.
Is it correct that there is also an IT Council and an IT Department? Are you a member of the council?
The council was formed after the dissolution of the HLCIT, and the IT Department exists under the Technology Ministry. But I do not know what the council has been doing even though I have been a member for the last one and a half years as the president of CAN. As far as I know, the IT Department which is stationed at IP Park is also not doing anything special. The private sector is moving ahead, but the government has lagged behind in coming up with timely policies and prioritising the sector.
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We will also bring tourists from Myanmar
CEO of Amtrip
KATHMANDU, NOV 12--Amtrip, a subsidiary of Amravati Travels, has launched a tour package targeting Nepalis visiting Myanmar on vacation or pilgrimage. The company plans to send its first group of Nepali tourists on a charter flight on Dec 1. The Post talked to Jugesh Shrestha, CEO of Amtrip, about the tour package, potential tourism to Nepal from Myanmar and future possibilities. Excerpts.
Tell us about the tour package which Amtrip has introduced?
Well, this is the first time that we are sending a tour group to Myanmar on a charter flight of Nepal Airlines from Kathmandu to Yangon. Our package includes seven nights and eight days accommodation and sightseeing in different tourist and pilgrimage destinations. We have tried to make the package economical and comfortable as far as possible. We will also bring Burmese tourists here.
How much does the tour package cost and what places will tourists get to see in Myanmar?
A seven nights and eight days package costs Rs 350,000 per person on twin-sharing basis in a five-star hotel. We also have a lower priced package costing Rs 218,000 per person with accommodation provided in three- and four-star hotels. The package offers visits to six destinations including the capital Yangon, Mandalay, Bagan, Inle and Pindaya. The price includes airfare, airport taxes, food and accommodation. We also have a similar seven nights and eight days package for Burmese tourists costing US$ 1,160 which covers visits to important places like Lumbini in Nepal and Bodh Gaya in India.
Why should Nepalis visiting Myanmar on pilgrimage and vacation go with Amtrip?
The first thing is convenience. Nepali Buddhists visit Myanmar on pilgrimage by spending more than Rs 150,000 and they stay in monasteries. They normally reach Myanmar via Bangkok. They take a bus from Yangon to Mandalay which takes around 16 hours. As our price also includes domestic airfare, it is more beneficial for the customer to choose Amtrip. We have visited Myanmar and checked out everything from tourist destinations to hotels and food. People will have a very comfortable stay.
When will Amtrip’s first group of Nepali tourists leave for Myanmar?
We have received very good response from customers. So far, 511 persons have made reservations for the trip. Out of the total 190 seats on NAC's aircraft, 186 seats will be available on our charter flight. Based on the volume of bookings, we will have to make three trips. The first flight is scheduled to leave for Myanmar on Dec 1 and the group will be back by Dec 8. There are some problems regarding currency exchange. So we will decide the departure date for the second tour group based on the pattern of passport submission and payment. Our flights will be scheduled for only Sundays and Wednesdays when NAC operates only one flight to Kuala Lumpur.
You said that Amtrip would also bring Burmese tourists to Nepal. What is your plan?
Normally, Buddhists from Myanmar visit mainly Lumbini via Sunauli in India. We have prepared tour packages for Burmese tourists under which they will visit Lumbini via Kathmandu and even Bodh Gaya in India in partnership with a local agency, Top Travel. We have priced the package at a rate lower than what it would cost a Burmese tourist to visit Lumbini via India. Pink Lotus of Myanmar has partnered with us to send tourists to Nepal. Similarly, a local travel company named Journeys will handle Nepali tourists visiting Burma.
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Relief fund for migrant workers will be set up within a week
President, Non-Resident Nepalese Association
KATHMANDU, OCT 22 -Australia-based Non-Resident Nepali Shesh Ghale was elected new president of the Non-Resident Nepali Association (NRNA) on Sunday. Ghale, 55, is the CEO and Executive Director of MIT Groups Holdings, which is also investing in Nepal in a five star hotel project. The Post talked to Ghale on his plans, investment promotion and possibilities in Nepal, and the first-ever election that took place to elect an NRNA chief. Excerpts
What are your plans as the new NRNA president?
This is an opportunity for me. Now, my first priority will be preparing an action plan based on my commitments in my election manifesto. The plan will have short-, mid- and long-term plans to bring investment in Nepal in potential areas. As I believe in team work, I will be visiting many countries to collect advice from NRNs living there. The action plan will be realistic and visionary for the next executive committee to follow. With the registration of the NRNA on Sunday, our association has received legal recognition. We will also be focusing on building our own office in Nepal. The registration has also made it easy for us to purchase assets. We also have some funds. It seems the newly elected executive committee will have the chance to carry out many financial activities.
For the first time, an NRNA president was elected through competitive electoral process, breaking away from the tradition of electing the head through consensus. How do you plan to take ahead the NRN movement?
I have underlined the spirit of unity and inclusiveness in my manifesto. In the past, the NRNA president used to be selected through consensus, and we tried to do so this time as well. But we had to go for an election after Tenzi Sherpa did not withdraw his nomination even after other three candidates of the president supported me. However, this is a democratic practice and election was
held under a fair process. This is not only my victory, but also my rival Tenzi Sherpa’s, as the focus of all of us is on the unity among Nepali diaspora.
It is said that the NRNA has failed to walk the talk when it comes to bringing investment to Nepal. What is your evaluation of the last 10 years of the NRNA?
Our effort regarding the investment in Nepal is a continuous process. In the last 10 years, NRNs have invested Rs 30 billion in different sectors in Nepal, as per the Federation of Nepalese Chambers of Commerce and Industry. This indicates that we can do more in the coming days. We have started off with baby steps. I do not see huge investment coming to Nepal soon. But when it comes to knowledge and skill transfer will help the country.
What are the hurdles in attracting investment in Nepal?
There are some key hurdles like the lack of investment friendly policies, delay in amendment to the antiquated Foreign Investment and Technology Transfer Act 1992, and the attitude of bureaucrats towards the NRNs. The NRNA is a bridge to attracting foreign direct investment. In my view, joint venture with foreign companies is the best way to bring in investment rather than direct involvement of foreign investors. Local partners can help international partners in dealing with local matters in the primary level. The NRNA, as a social organization, can only explain and promote Nepal’s investment potential in the international market. Besides, we are also working on making collective investment in the mother country.
There are reports about exploitation of Nepali migrant workers. What will the NRNA do for them?
Our new executive committee will very soon come up with a decision to establish an NRNA fund dedicated for the welfare of Nepali migrant workers. The fund will be utilised for providing immediate relief to Nepali workers facing difficulties abroad. Hopefully, we will reach a conclusion on the matter within a week. However, the size of the fund, the sources and the operation modality will be decided later. We are much aware that Nepalis are facing problems in international labour destinations. Many take the NRNA as a savoir of Nepalis facing problems, but it is misconception. We can network with international communities like International Labour Organisation regarding Nepali migrant worker issues.
It is said that you had strong backing from the UCPN-Maoist and the Nepali Congress for the election. What do you say on this?
More or less, the result of the election is the outcome of my visit to 25 countries in last six months. I had self confidence as I received goodwill from many NRNs wherever I reached. Since there were so many participants, around 1,000, they may have their own political belief and affiliation. I am not associated with any political parties. The NRNA should remain above the politics. Since I was fighting for the NRNA presidency, I had sought support from all sectors.
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VAS will play a dominant role for up to 10 years
Managing Director, Nepal Telecom
Amar Nath Singh is managing director of Nepal Telecom (NT), the largest tax paying company of the country. He is also the senior most employees serving the state-owned company for last 35 and half year. The company’s major projects like 10 million GSM mobile line, 2 million IP-CDMA and WiMax internet service are in implementation phase. Singh’s interview about the company’s projects, current market situation, competition and its strategies for voice and data market expansion.
NT some how lost the market share for the competition. What could be the reasons?
We do always come with better plans and programme, however, when they failed to be implanted on time for different procedural delay being a state owned company, such things leave negative impact on the company’s growth. As the chief of the company, I am concentrating on projects like 10 million GSM mobile line. The implementation of this project delayed for the requirement to follow the government rules and regulation which is must to our company. You know that there are other five telecom companies in market, I think if required they can take decision within a week.
Despite these problems, we signed agreement for 4.8 million mobile lines in the first phase. Another 5.2 million mobile line packaged took bit more time for being a legal issue. Now, finally both the packages are in implementation phase.
How do you take the increasing penetration rate in telecom service?
The telecom service penetration rate of the country now has reached to 70 percent plus. Except in Maldives and Bhutan, other major countries like Bangladesh, Sir Lanka, India and Pakistan are heading toward market saturation. In Nepal context, we have 10 million mobile lines project and other companies are also working their own, it indicate that we are in the path which will make mover 100 percent penetration in coming days. And, if you see average revenue per user (ARPU) is has come down and after implementation of new projects it would decline further. For this reason, we are also focusing to come up with value added services (VAS) for urban users.
Do you mean to say that Nepal Telecom will focus mainly on VAS?
Yeah, we are expecting to bring more VAS and start providing them to customers of urban areas and gradually in rural areas too. That is not all, we are also focused to take broadband service to all 75 districts of the country.
Tell us what shorts of VASs are being planned for urban and rural areas?
There can be different schemes. What is main thing is that we want customers to avail services as per their need apart from the basic voice service. As voice has become the traditional business, VAS will be a help to run the business in profit.
There are complains of service quality. What do you say?
There are some times problems like call drop and poor voice quality while talking about service in Kathmandu Valley. Actually, we have 500 plus base transceiver stations in the Valley under the old project of 3.5 million GSM line. What happened now is demand has increased even in the areas which use to be thin in the past. In such areas, network strength gets poor for the lack of tower in nearby areas for which customers face problems. In the 4.8 million line packages, we have broader plan for Kathmandu which will help improve the service quality. There will be additional 1,039 towers for 2G and 3G service in 508 locations. Further more, this time our agreement also include manage service based on which Huawei Technologies will also work for maintenance to ensure quality service.
What is your plan to make the company more productive and smart one?
At the when we transformed from the public corporation to a company, there were 4,900 employees now there are around 5,760 work force with addition of 850 staffs. Other companies hire and fire staffs are per their requirement, but being a company which has long history we can not cut the employees. If someone in the company is not capable of doing the job assigned he or she can be taken to another department with proper training. The main strength of the company which has help run the company effectively is engineering skill. If you see the trend, we have come up with so many types of services along with the entry of private sector telecom operators after being changed in to a company. We brought, CDMA, ADSL and expanded GSM service in big way in this period for the contribution of workers we have.
There are different options for taking the company ahead with new changes. Some asks to set up a subsidiary company and we also considering for that. However, being a government company we have responsibilities to take services in areas wherever the government wants without thinking of the profit. What I am trying to say is the type of changes which you can see in private companies for re-structuring or re-forming is not possible without big change in Nepal Telecom. And, I think we are not ready for that.
What is happening for long proposed strategic partner?
As a part of planned change for Nepal Telecom, we had proposed the government two things— management improvement and strategic partner with 25-30 percent stake. A report has also come regarding the plan of seeking partner to the company. If the dominance of the government continues and same old public procurement rule has to be followed there is no use of strategic partner.
It will make things easy for Nepal Telecom if a partner is brought with aim of revitalising the company. We have been asking time to time to the authorities concerned about it but it has not reached in the conclusion so far. Lets hope the government will decide on it soon. Generally, when there is competition in market, it become hard for government companies which have to follow the rules. You can take example from India.
How do you see the market dynamics if small players join GSM mobile service creating stiff competition further?
In India, for the increased competition and matter of survival, companies there have started demanding that the government increase tariff. In China, there are only two operators in such a big market. In Nepal’s context, even if there is 100 market there we do not have capacity for service distribution to more than 27 million customers and there are six operators. In my personal view, there is no need of additional operators. Normally, the more operators mean more competition. Now, tariff for calling to counties like the USA, Canada and the UK has dropped to Rs 1.75 per minute for the competition. Competition in market in a way is good in consumer perspective but the situation should not arise for which companies find it hard for existence.
What do you say about the new spectrum policy that has fixed higher fee and requires Nepal Telecom to return extra frequency in CDMA band?
There are some points in which we have requested the government for revision in the policy. It does not mean we are completely against it because the company has also paid spectrum fee partially based on the policy to the government. We have requested the government to limit the minimum frequency in the GSM 900 band at 7.2 Mhz which is assigned to Nepal Telecom. In 3G, we have been asked to pay Rs 1.44 billion spectrum but the revenue earned from this service is hardly Rs 350 million. As a responsibility of the government company, we had started the service with 8 towers in Kathmandu. If we were aware of such huge fee for 3G spectrum, we would never have thought of bringing this service in the country. We should get rebate for this and we are hopeful the government will come up with appropriate solution.
What is the plan regarding data service expansion?
Our WiMax is purely data service. That is not all, we also have EVDO in IP-CDMA technology what allows users to have good data connectivity regardless of the country’s terrain. We took ADSL service nationwide effectively and we are targeting to take WiMax in all parts of country too. Very soon WiMax service will be offered among general customers. We could not do it as per our original plan for the delay in procurement of consumer premise equipment. In our country, data is popular mainly in urban areas. I hope our projects on data will help make internet service easily available in rural areas too. If you see the trend globally, data has the future market. But, in Nepal’s case, VAS will play a dominant role for up to 10 years and gradually shift to internet.
When talking about data, what is company doing to introduce 4G?
Definitely, we have a plan to start 4G or LTE in 2015. We have also formed a committee to carry out study about it. We are also considering of operating 4G service with some improvement in the existing network, if possible and our 10 million GSM lines also include 4G lines. We hope that since Nepal Telecom board also has officials representing the government, we are hopeful that there will be favorable policy for this new service.
Being the cash rich company, what is the plan of the company for investment?
Our first focus is telecom sector. In a bid to see potential investment areas, the company board has also formed a committee. We have already invested in hydro power sector like Rs 6.6 billion in Tamakoshi and half of the investment in Trishuli B.
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President of Business Area Eurasia, TeliaSonera
KATHMANDU, AUG 28 -Tero Kivisaari is the president of Business Area Eurasia, TeliaSonera, the fifth largest telecom service provider in Europe. Kivisaari looks after 10 Eurasian countries where TeliaSonera is present. Kivisaari was recently in Nepal with top TeliaSonera officials. Ramesh Shrestha from The Kathmandu Post caught up with Kivisaari to talk about TeliaSonera’s investment in Nepal Satellite Telecom and future plans. Excerpts:
How do you review the last two years for TeliaSonera in Nepal?
I review the last two years as being very positive and am very pleased with the growth we have achieved on Ncell. We have invested a lot of money during the period that has enabled us to increase our network coverage and capacity. I am very encouraged by Ncell’s mobile data offerings. We have been building the organisation and the company.
How much has TeliaSonera invested in Ncell during the last year?
I do not want to comment about the last two years, but altogether we have invested something like US$ 450 million.
What about the next investment plan for Ncell?
I cannot spell out the exact numbers. However, we will continue investing in Ncell. The investments will be focused on the infrastructure side.
Which is the growth area for Ncell between voice and data?
We are enjoying a growth in mobile data users. I think data will definitely be growing in popularity. There is a large number of Nepalis who want to have internet access. We will continue data service with your 3G network. The quality of data is really important for us. We are able to offer good quality data for our consumers.
Do you think that future growth will be more from data?
It is going to be both voice and data definitely.
Can you tell me the objective of this particular visit to Nepal?
We wanted to see the management and meet different political parties here. It can be taken as just a visit to make sure that we are visible here.
There is a lot of speculation regarding TeliaSonera’s acquiring a majority stake in Nepal Satellite Telecom. Tell us what is the reality.
Nepal Satellite is a complementary asset to Ncell. And, it will enable us to roll out fast in rural areas and we will keep the brand as a regional brand focus for rural customers. We analysed the whole telecom market and found that investment will be complementary energy to Ncell. That was the main logic we had. I know there has been speculation, but it is very clear and simple.
Will there be a merger between Ncell and Nepal Satellite Telecom?
Time will tell. Whatever we do, we do within the regulations and rules of the country. Let’s see how we start to develop. We have not decided finally how the structure will look like.
Don’t you think that having two brands, Ncell and Nepal Satellite, will make your group a very dominant player in the local market?
It will make us a stronger player. I don’t say a dominant player as it has a kind of controlling the market sense. It is a very competitive market. You have all the players here, Nepal Telecom and other regional players, so you know I would not say dominant. We say strong. We have two brands in many markets. There is nothing strange in that.
TeliaSonera has recently changed the top management of Ncell, transferring Pasi Koistinen to Georgia. What was the rationale behind this change?
We are updating our management as a regular practice. The same CEO has been staying for more than two years in a country, and now we are changing the CEO here. We are bringing a CEO who has worked in Georgia. And Pasi Koistinen who was really successful here will go to Georgia.
Published on : 2012-08-29
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Minister for Physical Planning and Works
OCT 20 -The government is currently carrying out a few mega infrastructure projects, including the Kathmandu-Terai Fast Track Road and Mid-Hill Highway. These projects, once completed, will have a huge impact on the country’s transport sector and economy. Ramesh Shrestha caught up with Minister for Physical Planning and Works Hridayesh Tripathi about sustainable road development and ongoing big projects. Excerpts:
Of late, roads are being constructed at a fast pace, but they are not sustainable and returns are low. What do you say about this trend?
Roads have always been the first demand for infrastructure development. A lot of progress has been made in the development of road network in the country. However, there is also a negative trend of opening roads, especially in rural areas, neglecting engineering aspects and economic viability. These roads are constructed based on politically driven demands. Therefore, about two-third of the roads opened are not functional. Similarly, there is a trend of constructing roads in low-cost tender basis, compromising quality. There is also a need for revising policies as per the need of time, as land acquisition has emerged as a major problem for road projects.
Land acquisition has emerged as one of the major problems in transport infrastructure development. What is your ministry doing to address this problem?
There are mainly two main reasons behind this problem. First, we are going through a transitional phase, and second is the land acquisition law. There are land acquisition problems in the Kathmandu Terai Fast Track Road, Mid-Hills Highway and railway development project. We are now considering forming a powerful high-level authority that acquires land for infrastructure development projects. We have started talks in this regards. A committee formed for land acquisition for the Fast Track road has also recommended formation of a powerful central authority.
Why is the much talked-about Fast Track project not moving ahead?
We are now concentrating on track opening and land acquisition. We are currently studying whether to build the road under the build-operate-transfer (BOT), build-operate-own-transfer (BOOT) or using the government’s funding. Although it has not been fixed yet, it will be better for the government if it builds the road on its own. Work on project has not been carried out undergoing proper homework. The Parliamentary Public Accounts Committee has asked to continue the project only after carrying out thorough homework and also include Nepali companies. Therefore, we should look for a model that accommodates Nepali companies as well.
Where is the ambitious railway development heading?
We are just at the preliminary stage of railway development. We are planning to link main transit points with India. We have already set up the Railway Department to look after it and soon its responsibility will be defined. In some places, we have already acquired land. Work on the East West Electric Railway and metro railway in Kathmandu is underway.
Earlier, the government had planned to reintroduce the trolley bus service in Kathmandu. What do you say about the idea of bringing more environmentally friendly vehicles in the Valley?
In the present energy crisis situation, I do not think reintroducing the trolley bus service is a better idea. Talking about the metro railway in the Valley, it is just in its preliminary feasibility study stage. I tell you frankly that the time has not come to adopt eco friendly means of transportation as there is scarcity of electricity in the country. Rather, we should think of building short routes like the Fast-Track Road, travelling through which will lessen fuel consumption and carbon emission. We will also learn from the experts from various countries taking part in the Sustainable Development of Transport System in the Capital to know more about sustainable transport development.
Published on: 2011-10-21 08:42
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Philips vows to re-infuse life into Nepali market
Senior Customers Marketing Manager, Asia Pacific, Philips
KATHMANDU, APR 30 -Philips, one of the world’s noted electronic manufacturers, organised its Asia Pacific distributors’ meet and Philips Consumer Lifestyle Exhibition in Kathmandu this week. Boby Johnson, senior customers marketing manager-Asia Pacific of the company, talked to the Kathmandu Post about the events and Philips’ plans for Nepal. Excerpts:
How were the distributors’ meet and the exhibition?
Holding distributors’ seminar in Nepal for the first time was a tremendous experience. In terms of business too, both the events were successful, as Nepal holds huge business potential. We had put on display a wide range of our proportions and they were well received by Nepali consumers. I am going back well motivated.
How do you rate the Nepali market for Philips?
Nepal is one of the key countries for us and has a lot of opportunities. Obviously, how you tap these opportunities is a big challenge. For the last couple of years, business here is facing some difficulties because of the political situation. Now, with the changing market scenario, we and our local partner Sykar Company are very much hopeful that the market will get a boost. We are pretty much confident that we will be able to grow the business this year again. The distributors’ seminar was also for the same reasign—re-igniting the Nepali market.
What are Philips’ business targets for Nepal this year?
Well, it is not all about target, but doing the right thing based on the needs of Nepali consumers. Main things are marketing, planning and distribution, and if these things are in place, we do not need targets of doing business of this or that volume. We see a lot of opportunities here in Kathmandu Valley as well as outside. And, with Sykar Company, we will definitely capitalise these business opportunities. First of all, we will start looking what are there in the market. We will also look what Nepali consumers want. From the next month, we will launch new products and go for marketing with Sykar Company.
What do you say about competition in the Nepali market?
As you know, Philips is more than a century-old company having a very good brand heritage. We are pretty much sure that with our experience, we will produce, promote and bring innovative products. Yes, we face a stiff competition, especially in the Asian market, as the region is led by Asian brands such as Sony, Panasonic and Samsung, but we believe that with our propositions, we can compete with them and get a good market share. Each year, we have been coming up with new products designed for making the daily life easier.
What are your new products?
Airfryer is coming to Nepal soon. We have received orders for more than 400 units through the exhibition. We have a fantastic camera—easy pocket camera—coming soon. These are high tech products, but easy to use as which one does not need to have technological knowledge. We believe in bringing hi-tech products that can be used easily. We also have other new products such as cinema
proportioned 3D TV, new steam iron and vacuum cleaner, and these will hit the Nepali market soon.
Tell us about the 3D TV. What is so special about it?
We have come up with a 3D TV for Nepali consumers who had long been waiting for this product. We are the first to introduce the 21:9 proportioned 3D TV in the world. All movies in Hollywood are recorded in 21:9, so we are the only one to bring such TV for giving a complete theatre experience with clear picture quality and amazing sound in your living room.
Published on: 2011-05-01
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Managing Director, Nepal Telecom
KATHMANDU, FEB 11 -Nepal Telecom (NT), the state-owned telecom giant, is mulling massive expansion of its services, particularly the GSM segment. Amid growing competition, it has also demanded that the government bring in a strategic partner. Amar Nath Singh, managing director of the company, talked to The Kathmandu Post about the company’s current issues related to services and future plans. Excerpts
What is NT doing to hold its position as the market leader in Nepali telecom industry?
With the entry of private telecom service operators, the sector has become very competitive. It is natural too. In initial phases, we were more concentrated on fixed line. Now, our subscriber base has increased to 6.4 million including GSM, CDMA and PSTN customers. The growth is also the result of competition. We will continue to come up with new plans to stay at the top position.
Tell us about NT’s GSM service expansion plans?
GSM is our main service and a majority of revenue comes from GSM segment. For the next fiscal year, keeping in mind the competition, we are going to expand the service massively. We are in process to come up with a big project that will help us distribute 6 million GSM connections in the next fiscal year. We will also determine target areas of the country soon to provide these connections. Currently, we are in discussion phase of this project. We are also preparing to start distributing 1.5 million GSM connections by late March or early April this year.
What efforts are being carried out to bring in a strategic partner?
We made a presentation in this regard to the Ministry of Finance twice. The issue is being discussed by the government. As the market is growing rapidly, there is a need of a strategic partner to whom we can offer 25-30 percent of stake. There are cases of telecom companies facing hardships in India, Sri Lanka and Pakistan due to their inability to compete in the market.
The country’s laws should also be changed before bringing in the strategic partner. If we bring in a partner to work under the same old rules and regulations, it will be meaningless. We have already turned to a company, but the functioning has not changed completely. This has created problems for free growth.
What projects is NT introducing soon?
We plan to expand the Base Transcriber Stations (BTS). It will definitely help us offer better quality service for our customers. We will also focus on voice service in rural areas where 85 percent of the total populations live. For urban population, we will come up with advance voice services with value added services. I think the rural sector lacks fast expansion of voice services. In the coming days, the Nepal Telecom will work on taking voice services in deeper areas of rural Nepal. In urban areas, value added services will be more focused.
Do you have any plans for advance services like long term evolution (LTE) and IMT Advance?
As a market leader, we will continue introducing new and contemporary services at low price. However, with problems like load-shedding up to18 hours per day, how will our service run? We will surely bring advance technologies like LTE. This technology will be new till 2015, even though technologies keep changing by the day. We have also called tender for NGN and IP-CDMA again with 3.5 million line capacity. At the same time, we are coming up with a bridging project, under which 80 optical network units will be set up across the country to offer voice and data services. Later it can be connected to NGN network.
ADSL has now reached 75 districts. Do you have any further plans?
Well, we have covered all districts of the country. Now, we are increasing ADSL’s bandwidth. We will also continue its expansion for more customers in the Kathmandu Valley and other parts of the country. We plan to expand its capacity for 20,000 new users.
Recently, Public Accounts Committee directed NT to improve service quality. What are you doing on this front?
Well… quality is always measured based on comparison. Wireless service cannot be compared with PSTN service. To tell you frankly, even I am not satisfied 100 percent with the quality of GSM service. It depends on where a consumer is calling from, capacity of tower, load-shedding and power back ups. We are coming up with new plans to improve the service quality. As we have major problem of load-shedding, we will increase the power back up capacity of our towers using generators. We will follow all process to improve quality.
How far has NT’s optical fibre expansion plan reached?
The expansion from East-West is almost complete. North-South is also in our priority. Now, we are planning to expand 3,000 km optical fibre in collaboration with Nepal Electricity Authority and 800 km by ourselves. We have already expanded optical fire to Khasa, Tibet. However, we need to develop an alternative route to benefit from China and India. We have also called a tender for 250 km optical fibre expansion to develop it as a pilot project. If it succeeds, we will massively increase the expansion of optical fibre to develop Nepal as a transit route between China and India.
Published on: 2011-02-11
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Director, Nepal Telecommunications Authority
KATHMANDU, FEB 04 -Ananda Raj Khanal Director, Nepal Telecommunications Authority Allocation of spectrum to telecom service operators has emerged as a controversial issue with the growth in the telecom industry. The government is being pressurised to auction spectrum allocations as it is a limited resource. Ramesh Shrestha of The Kathmandu Post talked to Ananda Raj Khanal, director of the Nepal Telecommunications Authority, about auctioning spectrum, its availability for new operators and preparations for new services like WiMax and 4G. Excerpts:
What is the current situation of spectrum and its management?
The government has formed the Radio Frequency Policy Determination Committee headed by the Minister of Information and Communications based on the Telecommunications Act 1997. This committee gives a framework for spectrum management including allocation, pricing and assignment criteria. When spectrum is allocated for telecommunications applications, then this comes under the jurisdiction of the Nepal Telecommunications Authority. So far, we have been assigning frequency to operators on a first come, first served basis.
There are other methods used globally, and auctioning is one of them. This is the most transparent and most revenue generating method for the government. Another method is called beauty contest in which the regulator evaluates the applicant based on a number of criteria. Under the first come, first served basis used in Nepal, frequency is assigned in the license itself or at a later date.
Is there any possibility of auctioning spectrum?
Let us divide this issue into two parts. One, the spectrum already assigned to existing operators; and two, the spectrum available with the government or the regulator. With regard to the spectrum already assigned, we can not go for an auction or we can revise the pricing policy to reflect the market price. Now, we cannot take it back and auction it. It is not possible. The second thing is the spectrum we have in hand which has not been assigned to any operator. For example, we have spectrum for WiMax. We can create spectrum for fourth generation technology (4G) like long-term evolution (LTE) and international mobile telecommunications (IMT) advance. For these types of services, spectrum can be auctioned if the government thinks that is the proper thing to do.
Is there spectrum available for new operators in the GSM segment?
Well, you see currently, for the GSM system we have two bands—allocated by the committee—one in 900 MHz band which has 25 MHz and another in 1800 MHz which has sufficient spectrum. But in 900 MHz band, we do not have any spectrum left for any new operator. In 1800 MHz, currently we have 7 MHz band available and with this band one can operate the service in urban areas where the population is dense.
How many operators can provide services with 7 MHz band?
We already have five GSM operators in Nepal. Two of them are operating services with only 2.4 MHz and with the increasing subscriber base, they are going to require more bandwidth and we do not have this spectrum in 900 MHz band. So if they fulfil our criteria, we have to give it from 1800 MHz. I do not think that it is advisable to bring new operators with 7 MHz band because there will be nothing left. UTL is going to vacate spectrum from 1800 MHz band within two or three years so with that lot of spectrum for 3G and 2G and GSM will be available.
What about revoking the extra spectrum provided to Nepal Telecom and Ncell?
We have already made spectrum re-farming related to CDMA, GSM and 3G. Refarming is already complete, but revoking spectrum which the operators are already using is not a very straightforward action. They require a number of capacity changes, a number of additional infrastructure development so they require some time. The NTA has given two years’ time to either fulfil the requirement set in this bylaw or leave that spectrum or pay a very high amount. However, the pricing has not been approved by the committee. It is still difficult to revoke that spectrum. But I think both Nepal Telecom and Ncell will fulfil the criteria to retain the extra spectrum.
Do you mean that there is no spectrum left for new players?
Out of the six operators, three are in rural areas and three at the national level. Thus, six operators with 30 million people in a country which is least developed, we have to think what is the level of competition that we want to bring in.
How about making spectrum available for new service like 3G and 4G and make these services cheap and accessible to the people?
As far as 3G is concerned, two major operators Nepal Telecom and Ncell are already offering the service. Regarding 4G, WiMax is taking a long time for its allocation and for LTE service the band has not been allocated. We have already initiated work to identify the band for LTE because Ncell has already requested a trial.
LTE, I think is a long way to go for Nepal because this has not been launched in many countries. When LTE becomes very popular, we will be able to allocate LTE spectrum to interested operators. New operators by that time can also compete for LTE.
Tell us about the fees that the government charges from telecom operators for obtaining spectrum.
Spectrum pricing has not been very efficient in Nepal. It is bundled with the license, so as long as they have this service license, the spectrum is under them. They do not need to pay renewal charges; but they need to pay an annual spectrum charge based on the use, not on how much they hold. All the operators are paying annually except Nepal Telecom. It has started paying annual spectrum charge from this year.
It is said that the NTA has assigned spectrum to some operators under political pressure. Is it true?
It is a very difficult question. Well, you see, it is policy and regulatory intervention for telecom growth in rural areas. Now we have liberalised the market, and we have introduced private, foreign and domestic operators. We witnessed that rural areas are still not served well.
We realized that specific intervention has to be made by the government and the regulator so that operators are motivated to go to rural areas. If we had not introduced rural operators with specific targets, the telecom sector would not have developed the way it has.
Published on: 2011-02-04
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Mid-Hill Highway can be completed in 3 years
Dinesh Prakash Basnet
Project Manager, Mid Hill Highway
KATHMANDU, JAN 27 -Dinesh Prakash Basnet is project manager of the Mid-Hill Highway Project which was started four years ago. Last Monday, the project made a presentation on its detailed project report to seek funding. Basnet talked to The Kathmandu Post about the amount of funds needed, the project’s progress and the importance of the highway. Excerpts:
How is the Mid-Hill Highway Project progressing?
The work is going smoothly so far. We are very hopeful that the track opening of the remaining 226 km will be completed on time within this fiscal year. Our plan is to start the blacktopping after the opening of the track from the next fiscal year. Last Monday, we also made a detailed project report (DPR) presentation at the Ministry of Finance to start looking for interested donor agencies to invest in the project.
How much money would you need to complete the project?
A total of Rs 43.38 billion has been estimated for the construction of the highway. It includes the cost for blacktopping, track opening, construction of 48 bridges and culverts and pavement works. The DPR has underlined what types of other development works can be carried out along with this highway.
Why has the project recommended to the government to maintain the standard width of 8.5 m?
It is a highway; hence its width should be 8.5 m. Last year, we had opened 200 km of track with a width of 8.5 m. The remaining 226 km to be opened in this fiscal year is also 8.5 m wide. The 160 km Bhojpur-Diktel segment completed last year under the first phase will also be widened to 8.5 m. In other sections, we have urged the government to expand the highway to 8.5 m. Except the Sindhuli segment, all the other sections of the highway will be widened to 8.5 m. We have also talked to the government for expansion of the Sindhuli segment.
When is the project going to be completed?
If the government funds the project itself, it can be completed within the next three years. However, it is a big project that needs huge resources. Donors like the Asian Development Bank, World Bank, Japan International Cooperation Agency and Export Import Bank of India are interested in investing in various segments of the highway. If we look for donors, it may take around four years to complete the project. The Chinese are interested in the Bhojpur and Surkhet portions. We have also provided them the report. The ADB has agreed to work on the Leguwaghat-Bhojpur section under its road connectivity project. Blacktopping will start from next year. The Ministry of Finance has forwarded the DPR to the ADB and the World Bank.
Is the project facing any problem with regard to land acquisition and compensation?
Till now there have been no major problems. Since we are carrying out the opening of the track, we have not provided any compensation. People have easily allowed us to open the track through their land. There were some small problems in a few places like near Khurkot and Rukum created by local political leaders, but we have convinced them. We did not face many problems as most parts of the road pass through forests.
Tell us about the bridges that fall on the highway.
There are altogether 48 bridges, and they are all double-lane. Construction of 12 bridges on the Sindhuli section will start soon as we are all set to call for tenders within a week.
What are the potentials of the Mid-Hill Highway? How will it change the lives of people in the hills?
The highway will change the lives of the people in the mid-hills of Nepal. The main aim of this highway is to divert traffic from the East-West Highway. Tourism, hydropower and agriculture in the region will benefit after the project is finished.
Published on: 2011-01-28
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BlackBerry is more than a device
Project Manager, Mid Hill Highway
KATHMANDU, JAN 27 -Dinesh Prakash Basnet is project manager of the Mid-Hill Highway Project which was started four years ago. Last Monday, the project made a presentation on its detailed project report to seek funding. Basnet talked to The Kathmandu Post about the amount of funds needed, the project’s progress and the importance of the highway. Excerpts:
How is the Mid-Hill Highway Project progressing?
The work is going smoothly so far. We are very hopeful that the track opening of the remaining 226 km will be completed on time within this fiscal year. Our plan is to start the blacktopping after the opening of the track from the next fiscal year. Last Monday, we also made a detailed project report (DPR) presentation at the Ministry of Finance to start looking for interested donor agencies to invest in the project.
How much money would you need to complete the project?
A total of Rs 43.38 billion has been estimated for the construction of the highway. It includes the cost for blacktopping, track opening, construction of 48 bridges and culverts and pavement works. The DPR has underlined what types of other development works can be carried out along with this highway.
Why has the project recommended to the government to maintain the standard width of 8.5 m?
It is a highway; hence its width should be 8.5 m. Last year, we had opened 200 km of track with a width of 8.5 m. The remaining 226 km to be opened in this fiscal year is also 8.5 m wide. The 160 km Bhojpur-Diktel segment completed last year under the first phase will also be widened to 8.5 m. In other sections, we have urged the government to expand the highway to 8.5 m. Except the Sindhuli segment, all the other sections of the highway will be widened to 8.5 m. We have also talked to the government for expansion of the Sindhuli segment.
When is the project going to be completed?
If the government funds the project itself, it can be completed within the next three years. However, it is a big project that needs huge resources. Donors like the Asian Development Bank, World Bank, Japan International Cooperation Agency and Export Import Bank of India are interested in investing in various segments of the highway. If we look for donors, it may take around four years to complete the project. The Chinese are interested in the Bhojpur and Surkhet portions. We have also provided them the report. The ADB has agreed to work on the Leguwaghat-Bhojpur section under its road connectivity project. Blacktopping will start from next year. The Ministry of Finance has forwarded the DPR to the ADB and the World Bank.
Is the project facing any problem with regard to land acquisition and compensation?
Till now there have been no major problems. Since we are carrying out the opening of the track, we have not provided any compensation. People have easily allowed us to open the track through their land. There were some small problems in a few places like near Khurkot and Rukum created by local political leaders, but we have convinced them. We did not face many problems as most parts of the road pass through forests.
Tell us about the bridges that fall on the highway.
There are altogether 48 bridges, and they are all double-lane. Construction of 12 bridges on the Sindhuli section will start soon as we are all set to call for tenders within a week.
What are the potentials of the Mid-Hill Highway? How will it change the lives of people in the hills?
The highway will change the lives of the people in the mid-hills of Nepal. The main aim of this highway is to divert traffic from the East-West Highway. Tourism, hydropower and agriculture in the region will benefit after the project is finished.
Published on: 2011-01-28
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CEO, Ncell
KATHMANDU, AUG 21 -Last week, Spice Nepal, the first private operator of GSM mobile services, introduced BlackBerry solutions in Nepal. Ramesh Shrestha from The Kathmandu Post talked to Pasi Koistenen, chief executive officer of Spice Nepal about the rationale behind launching BlackBerry, its security issues and Spice Nepal’s future plans. Excerpts:
Why did Ncell introduce BlackBerry solutions in Nepal?
Actually, there are two reasons. First, we want to bring the best quality services available worldwide to Nepal and BlackBerry is one of them. Secondly, there is a sizeable number of people in Nepal with good purchasing power and who are willing to pay for this premium service. The corporate people wanted this product in Nepal to keep them connected to their office even if they are out of the country. We want to have a big foothold in the corporate sector and BlackBerry is the ideal medium for this.
How is BlackBerry is so special compared to other smart phones?
BlackBerry is more than a device. It is a solution. The device is just a tool to get the solution. While talking about the solution, it is an end-to-end special service to begin with emailing and communication. When I buy a set, it is a tool but behind it there are services that really matter. In Nepal, we offer two services — BlackBerry Internet Service (BIS) for small businesses and individuals and BlackBerry Enterprise Server (BES) to our corporate clients with BlackBerry Bold 9700 model.
How about the monthly charge and services by Ncell for BlackBerry users?
In BIS, we will offer email and internet service but not full service at the Rs. 999 monthly charge. It is designed for small businesses and individuals users. Then, you have BES with monthly subscription charge of Rs. 1,499. It has secure email service, calendar, address book and other services. The monthly charges are only for BlackBerry services. Customers are liable to pay normal charge for making calls. The solution is available for post-paid users only.
Do you have plans to take the Blackberry solution to general people by offering instalment facility?
That’s a good point. We have good examples from Turkcell of Turkey, where people are using Blackberry. Nowadays, Blackberry has become a service for the general people. In the case of Nepal, it is expensive for ordinary and middle class people for now. Currently, we have targeted premium customers for premium services to begin with. One day, of course, we will be reaching lots of general customers too.
Tell us about Ncell’s future plans.
This is always the biggest issue. We will continue good quality services and innovations in the market. When the time is right, you will hear what our next step will be.
Blackberry, in recent weeks, is in the news for security issues in some countries with it issuing threats to stop services. What do you have to say regarding this?
Well, there is a clear borderline; we are here as a service provider company. There has been much talk about the technology and encryption between end-to-end. Actually, it is good for customers too. If Nepali authorities seek information, we need to sit and talk. We have got all the necessary approval from Nepal Telecommunication Authority. One very important thing for TeliaSonera and Ncell is that we really appreciate the privacy of our users.
Published on: 2010-08-22
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‘We have invested around $80m in Nepal’
President, TeliaSonera Eurasia
Why TeliaSonera found it necessary to re-brand Mero Mobile to Ncell?
Tero Kivisaari: We wanted to refresh the whole image of our company in this country. Our aim is to make Ncell the number one 1 player in Nepal's telecom market making inroads even into the rural areas. We will offer international standard quality service at low price and expand our network coverage in a big way.
How long it will take to re-establish the brand image in the market?
The launching has been very good. It will take some time and money. I think we will re-establish it within this year.
How difference will Ncell bring in for subscribers?
Better quality and better customer experience. When I came to Nepal for the first time, I could not make even one call abroad. Now look at the quality of service of our company. It is perfect and we will keep on improving. We have to make sure that the service is affordable to everybody in Nepal.
What's the plan of TeliaSonera for Nepal?
I believe we've covered around 62 percent of the population here and our target is to cover 99.9 percent with quality service at low price to become number one in the market. It might be tough but we will continue to work and meet our target. Our investment in telecom infrastructure will increase with focus on rural areas. We're planning to develop new packages so that the people can afford our service. New changes will definitely come. Nepal is great opportunity for TeliaSonera.
How much do you plan to invest in Nepal this year?
We have already invested around US$ 80 million in Nepal. This country needs investment and infrastructure development. And we want to be part of that, building the infrastructure for Nepal and Nepali people.
What do you think of infrastructure sharing with other telecom service operators in Nepal?
Obviously, we can share infrastructure with other operators but it depends on proper commercial terms and negotiation.
What is the penetration rate of Ncell?
It is just below 25 percent. We will also start providing data services. It means people should have access to internet from mobile. For this happen you need to have smart phones and 3G network. And I assure you we will make it happen.
When will Ncell start 3G service?
There is time for everything. Our team has a road map for the whole year. And if they follow that road map, 3G service will definitely come. 3G will be here in the near future, that's for sure. We can also introduce 4G service which we've been offering in some of the countries where TeliaSonera has presence.
Des that mean 4G is also on the cards?
It depends on the regulatory body. For 4G, we need the frequency and also the license. I believe in some of the big cities of Nepal, 4G can be a reality in a couple of years. It will happen faster after 3G. But you need to have a regulatory body with vision in order to get there.
Tell us about the number of countries covered by TeliaSonera and total subscribers?
We have covered 20 countries and I'm responsible for 10 countries including Russia and Turkey, the biggest players in the markets in terms of subscribers. We have over 100 million subscribers in Russia. As of now, TeliaSonera's total subscriber is 147 million, of which 120 million are from Eurasia.
Published on: 2010-03-14
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