VZCZCXRO0801
OO RUEHBI RUEHDBU
DE RUEHKT #0743/01 0751118
ZNR UUUUU ZZH
O 161118Z MAR 06
FM AMEMBASSY KATHMANDU
TO RUEHC/SECSTATE WASHDC IMMEDIATE 0772
INFO RUEHTA/AMEMBASSY ALMATY PRIORITY 0029
RUEHBJ/AMEMBASSY BEIJING PRIORITY 4054
RUEHEK/AMEMBASSY BISHKEK PRIORITY 0021
RUEHLM/AMEMBASSY COLOMBO PRIORITY 4322
RUEHKA/AMEMBASSY DHAKA PRIORITY 9401
RUEHDBU/AMEMBASSY DUSHANBE PRIORITY
RUEHIL/AMEMBASSY ISLAMABAD PRIORITY 2305
RUEHBUL/AMEMBASSY KABUL PRIORITY 0141
RUEHLO/AMEMBASSY LONDON PRIORITY 3713
RUEHNE/AMEMBASSY NEW DELHI PRIORITY 9380
RUEHBI/AMCONSUL MUMBAI PRIORITY 3618

UNCLAS SECTION 01 OF 02 KATHMANDU 000743 
 
SIPDIS 
 
SIPDIS 
 
DEPT FOR SCA/INS, 
DEPT PASS TO USTDA (MBASSETT) 
 
E.O. 12958: N/A 
TAGS: ECON EAIR EINV ELTN NP
SUBJECT: NEPAL DELEGATION TO USTDA TRANSPORTATION 
CONFERENCE IN MUMBAI SEEKS FOREIGN INVESTMENT 
 
 
BACKGROUND 
---------- 
 
¶1. (U) Embassy Kathmandu was pleased to have one of its 
Emboffs accompany a two-member government delegation from 
Nepal to the United States Trade and Development Agencies' 
(USTDA) "Transportation Solutions for South Asia Trade" 
conference held in Mumbai, India, March 7-9, which 
highlighted transportation infrastructure development needs 
in South Asia.  The conference brought together government 
delegates from Afghanistan, Bangladesh, Bhutan, India, 
Maldives, Nepal, Pakistan and Sri Lanka, as well as 
representatives from 18 U.S. companies and the Asian 
Development Bank and World Bank.  Government delegates 
presented transportation infrastructure projects for their 
respective countries in group sessions and U.S. companies had 
the opportunity to schedule one-on-one appointments with the 
delegations of their choosing.  (Delegates from Kazakhstan, 
Kyrgyzstan, and Tajikistan attended the conference as 
observers.) 
 
NEPAL DELEGATION OUTLINES AIRPORT UPGRADE PROJECTS AND 
CHINA-INDIA LINKS 
--------------------------------------------- --------- 
 
¶2. (U) Mr. Kamal Kumar K.C., Officiating Director General of 
the Civil Aviation Authority of Nepal (CAAN), and Mr. 
Radakrishna Pradhan, Under Secretary, National Planning 
Commission, outlined a number of possible projects in Nepal 
open to foreign direct investment.  Mr. K.C. explained 
Nepal's major airport improvement projects, which included: 
upgrading Pokhara (central Nepal) airport from a domestic to 
international airport with a longer runway; extending the 
runway at Bhairawaha (southwest Nepal) airport; and upgrading 
to Nepal's only international airport, Tribhuvan 
International Airport (TIA), located in Kathmandu.  Mr. 
Pradhan explained His Majesty's Government of Nepal's (HMGN) 
plan to become a trade and transit link between India and 
China by building eight north-south roads through Nepal to 
link the two major economic powerhouses.  He also noted plans 
for direct road and rail links between the major Indo-Nepal 
trade border town of Birgunj and Kathmandu.  Building an 
approximately 12 kilometer tunnel would reduce to around 
three hours the current eight-to-ten hour trip over 
mountainous roads between Birgunj and the capital.  The 
airport and road/rail projects all require significant 
funding to be implemented and Nepal is seeking foreign direct 
investment for them. 
 
U.S. COMPANIES INTERESTED IN SELLING TECHNOLOGY AND EQUIPMENT 
FOR NEPAL'S AIRPORTS 
--------------------------------------------- ---------------- 
 
¶3. (U)  Four U.S. companies, which requested meetings with 
the Nepal delegation during the scheduled one-on-one 
sessions, were primarily interested in selling information 
management technologies and security equipment for use in 
Nepal's airports.  While the technology and equipment offered 
by the U.S. companies would be beneficial to Nepal, the lack 
of HMGN funds would likely prevent any significant purchases. 
 A representative from Lockheed Martin was marketing 
Lockheed's air traffic management technology.  Mr. K.C. 
lamented the decaying state of TIA's Japanese radar system 
and explained that CAAN would like to be in a position to buy 
a new radar system along with air traffic management 
technology.  Oracle offered an information management 
software solutions package for airports, which Mr. K.C. said 
would be beneficial for TIA's billing systems as all bills 
for landing rights were currently done manually.  A 
representative from the security company Ingersoll Rand 
inquired whether CAAN was interested in purchasing electronic 
access equipment to complement the wiring Ingersoll installed 
at TIA in 2000.  The actual electronic access equipment was 
never purchased due to lack of government funding.  Mr. K.C. 
explained that electronic access equipment had yet to be 
acquired and remained an item on CAAN's wish list.  The 
railcar brake manufacturer Ellcon-National was curious if 
Nepal had any plans to develop freight rail beyond the border 
 
KATHMANDU 00000743  002 OF 002 
 
 
towns of Nepal.  Mr. Pradhan explained there were no such 
immediate plans. 
 
COMMENT 
------- 
 
¶4. (SBU) The two delegates from Nepal actively participated 
in the conference and networked with U.S. company 
representatives and government officials from the other 
countries.  Mr. K.C. was planning to follow up with 
representatives from Oracle and Ingersoll Rand on cost 
proposals.  Nepal's lack of national funds and currently 
unfavorable investment climate however, will continue to 
dampen HMGN plans for its aviation, road and rail 
infrastructure projects. 
SCHLOSSER