Nepalese, U.S. aviation companies launch air cargo venture [VIDEO]

Nepalese Simrik Airlines and U.S.-based Sapphire Global Airways have signed a memorandum of understanding (MoU) to establish a dedicated, international long-haul cargo airline in Nepal.

The agreement marks the establishment of Nepal’s first such cargo operation, said Rahul Puranik of Sapphire Global. “We plan to operate in Southeast Asia in the first phase with two Boeing 777s,” he said, adding that “in the second phase, expansion will be made to European countries.”

The new carrier, tentatively named “Simrik International Cargo Airlines/Sapphire Global Airlines,” will cater to the increasing demand for cargo transportation in the country, which is struggling to right its economy after last year’s devastating earthquake, which left at least 8,000 people dead and hit the country’s vital tourism sector especially hard. Cargo held up at the Nepal-India border has also hurt businesses.

The new carrier will make Kathmandu’s Tribhuvan International Airport (TIA) its cargo hub. The airport, Nepal’s largest, is already a growing destination for air cargo. According to figures issued by TIA, cargo movement in 2015 was up 23.6 percent to 24,513 tonnes per year. More than half of this figure was imports, at 14,611 annual tonnes. Export cargo for the year totaled 9,902 tonnes.

While the new venture has some lofty goals, considering that Sapphire Global itself is a startup airline that has yet to launch, Puranik said that there were extensive opportunities for air cargo business in landlocked countries like Nepal. Given the country’s mountainous terrain – much of it lies in the Himalayas – and poorly maintained roads, air transport is a vital economic link.

Sapphire Global Airways will hold a 70 percent stake in the joint venture, valued at US$150 million. According to Kathmandu Post, the airline is expected to be operational within a year.

Simrik Airlines currently operates Beech 1900Ds and Do228s on regular passenger flights within the country, often to small, hard-to-reach outposts, such as Jomsom, far up in the mountains. The airline, and other small operations like it derive a significant part of their revenue shuttling tourists between Nepal and the country’s major tourist destinations. Given the small passenger twin-turboprops that the airline uses, ramping up operations to the use of 777 freighter jets on much longer hauls will necessitate significant resources and scaling up of operations, making this an especially ambitious undertaking.

Below, one of Simrik’s Dornier 228 twin-turboprop planes lands at the high-altitude Jomsom airport: