The government has floated a preliminary draft of the new Aviation Policy, 2025, for public consultation, outlining ambitious measures to boost international connectivity, promote investment and modernize the aviation sector. The draft prepared by the Ministry of Culture, Tourism and Civil Aviation, will replace the Aviation Policy, 2006, once it is finalized.
The government plans to establish a permanent and independent accident investigation mechanism, ending the long long-standing practice of forming commissions after every aviation accident. This move is expected to strengthen Nepal’s commitment to international aviation safety standards.
The draft includes a proposal to grant fifth freedom traffic rights to international carriers operating from Gautam Buddha International Airport of Rupandehi and Pokhara International Airport of Kaski.
These two international airports, which are built using foreign loans, have been struggling to get international flights.
Fifth freedom rights authorize an airline to fly passengers and cargo between two foreign countries as part of a route that originates or ends in its own country. Bhutanese airlines are currently flying passengers between Kathmandu and New Delhi on flights that originate in Paro using the fifth freedom flights granted by Nepal.
The draft proposes stricter rules on aircraft imports. As per the draft, pressurized aircraft that have completed more than 50 percent of their economic design life or over 35,000 pressurization cycles cannot be imported into the country. This is a stricter standard than the current thresholds of 75 percent life and 45,000 cycles. For non-pressurized aircraft, the maximum age limit allowed for imports is 20 years. The draft also allows Nepali citizens and institutions to own private aircraft. Such aircraft, however, cannot be used for commercial purposes.
The policy also signals a shift toward more liberal and reciprocal air service agreements, with the aim of gradually adopting an open skies policy. Third-party code-sharing and transparent allocation of routes and flight frequencies based on the capacity of Nepali carriers are among the features aimed at enhancing competitiveness.
Similarly, the draft proposes to raise the ceiling for foreign investment in international airlines based in Nepal from 80 percent to 90 percent. However, the cap for domestic airlines will remain unchanged at 49 percent. In addition, the government plans to provide land at non-operational airports to institutions engaged in aircraft maintenance, pilot training, or aircraft design and manufacturing.
To support aviation training, the draft offers tax exemptions for flying schools during their first three years of operation. It also proposes a co-investment model involving federal, provincial, and local governments for new airport construction. However, new airports will be approved only if their long-term operational viability can be ensured.
