High demand + lower supply = higher fares. This is the standard theory in the airline industry.

Mismanagement + poor planning + high demand + low supply = super high fares, and passengers suffer. This is the case in Nepal.

Flight prices are leaving travellers frustrated in a country that aspires to attract 1.6 million tourists by the end of this year to come to the aid of its ailing economy.

Airfares have increased nearly fourfold in Southeast Asia, while they have more than doubled for flights to the West.

For instance, travel agencies say a one-hour and 15-minute Kathmandu-Delhi flight will now cost Rs80,000 one way from the first week of November, which is the highest rate of a flight based on the Reservation Booking Designator (RBD).

Airlines just don’t hike fares arbitrarily. Through the RBD, the selling fare follows a stair-step pattern, ranging from the lowest to the highest fares, with a difference of $15 to $100 for each step.

The lowest fare, rarely available in the sector, is Rs42,000.

Nepal Airlines, which has hardly increased its rates, has issued a Rs48,000 fare for its business class ticket, as economy class seats are sold out for the Delhi sector.

But inbound flights or Delhi-Kathmandu flights cost Rs17,500.

This is because, from November 8, Kathmandu’s Tribhuvan International Airport will be closed for 10 hours a day, from 10 pm to 8 am, for five months until March 31, to expand the taxiways.

September-November is Nepal’s peak tourist season and the time when migrant workers and other Nepalis studying and working abroad return after celebrating key festivals at home.

Two parallel taxiway projects are ongoing at the Tribhuvan International Airport in Kathmandu.

As part of the improvement plan, a 1,140-metre-long parallel taxiway is being built on the runway’s southern side, or the Koteshwar end. This will connect the existing international apron to the end of runway 02.

Similarly, another 450-metre-long parallel taxiway is being constructed at the northern end of the runway.

Travel trade entrepreneurs say it is an unplanned construction that is taking way too long and will extend to another peak tourism season in spring (in March).

“As a result, ticket prices are now at all-time highs,” said Shyam Raj Thapaliya, managing director of Osho World Travel Nepal, one of the leading travel agencies.

He said airlines must cut 50 percent of flights, so demand has risen exponentially.

“Airlines are scrambling to manage the slots as they have already sold tickets to foreigners a year in advance,” said Thapaliya.

Travel trade entrepreneurs said the civil aviation body’s mismanagement could shave at least Rs50 billion in revenue from the airline and tourism industry, even as the government struggles with revenue generation.

What is the airfare in other sectors?

After Kathmandu-Delhi flights, Sydney is the most frequented at this time and the most in-demand sector in November.

The upper fare in the Kathmandu-Sydney sector is Rs217,000, and the lowest is Rs114,000. The normal one-way airfare on the route used to be Rs85,000.

Flying to Washington, D.C., the US, from Kathmandu will cost Rs192,000 for a one-way at the higher end. The standard fare for this route used to be Rs100,000.

Similarly, the Kathmandu-London fare has climbed to Rs217,000, and the lowest ticket price is Rs142,000. The normal airfare used to be Rs72,000 on this route.

Ticket prices in the labour destinations have also spiked.

According to travel agencies, the Kathmandu-Dubai ticket has jumped to Rs171,000 at the higher end, while the cheapest option is Rs82,000. The normal fare used to be Rs35,000 in this sector.

Likewise, the Kathmandu-Kuala Lumpur flight will cost Rs54,000, while the cheapest option is Rs39,000. The normal fare in the sector used to be at Rs29,000.

The airfares started rising before the airport construction.

Rama Sharma booked a flight from Kathmandu to New Delhi on Monday, for November 5, and the cheapest option she found was Rs67,000 for an economy return ticket on an Air India flight.

Sharma says that two-way tickets used to cost roughly Rs40,000. “For those prices, I should be able to fly two round-trips in this sector,” she adds, expressing her frustration.

“Passengers are being victimised from all sides.”

“A friend of mine from Bombay called to say that the direct flight cost to Kathmandu is almost the same as the cost of direct flights to Athens. Any reason why the price of Bombay-Kathmandu flight tickets have skyrocketed?,” Prajwal Raj Gyawali wrote in X, formerly Twitter, on October 23.

“Cost of Delhi-Kathmandu return ticket by @IndiGo6E reaches nearly 1 lakh rupees [Rs 100,000]. What kind of tourism promotion is this?” an X handle Kamala93 wrote. “@PM_nepal_The govt should immediately see why this is happening?”

Mani Raj Lamichhane, director of the Research, Planning and Monitoring Department of Nepal Tourism Board (NTB), the country’s tourism promotional body, said that airport construction for long hours in the peak season would be a big setback as it would reduce flight frequency, increase airfare, and keep tourists from coming to Nepal.

“Raising airfare fourfold will make a big dent to any country’s tourism."

He said most hotels have started receiving cancellations for November due to the high airfares and the possibility of chaos at Kathmandu airport. “Most airlines connect Kathmandu at night to manage their connecting flights. Closing an international airport for 10 hours is not a wise decision.”

The tourism board has also revised its tourist arrival numbers for 2024, to 1.1 million from the projected 1.3 million.

“The planned construction will also affect spring tourism next year.”

Worried tourism entrepreneurs, who have seen tourists coming to Nepal despite repeated plane crashes, have urged the government to reduce the construction time to five hours from the proposed 10 hours.

The Civil Aviation Authority of Nepal has been ordering international airlines to make some flight arrangements from Pokhara and Bhairahawa international airports to reduce pressure.

However, airlines are reluctant to fly from those airports, as they don’t consider it technically and financially feasible.

A senior official of one international airline told the Post that the civil aviation body has been forcing airlines to fly from Bhairahawa, regardless of their refusal. “It’s a punitive measure.”

The International Air Transport Association (IATA), a trade association of the world’s airlines that advocates for travellers’ safety, security, and efficiency, issued a letter to the Civil Aviation Authority of Nepal on October 1 after plans to close the airport evoked concerns from multiple sides.

The letter, obtained by the Post, said the reduction in operating hours is causing airlines to cancel flights at short notice, inconveniencing passengers who booked tickets a year in advance.

“IATA has been informed that Tribhuvan International Airport will reduce its operating hours from 8 November 2024 to 31 March 2025 to facilitate runway maintenance. Additionally, IATA has noted that there has been no proportional reduction in established schedules. Some airlines have received schedule approvals during the affected period, while others have not.”

IATA has suggested conducting a comprehensive demand and capacity assessment.

Kathmandu airport was designed as a Level 1 airport, which should theoretically meet airline demand. The Level 1 category means that airport capability is generally adequate to meet demand.

However, airlines have reported that their schedules cannot be accommodated during maintenance. IATA has recommended that the civil aviation body reduce the daily closure period by two hours and avoid closure on the week's busiest days.