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Cablegate: Biman Crash Prompts Bdg Approval of New Aircraft

This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS DHAKA 003177

SIPDIS

E.O. 12958: N/A
TAGS: ETRD ECON PGOV BG
SUBJECT: BIMAN CRASH PROMPTS BDG APPROVAL OF NEW AIRCRAFT
PURCHASE

REF: DHAKA 02988

1. Summary: A Biman Bangladesh flight, inbound from Dubai
carrying 215 passengers, crash landed and skidded off the
runway in Chittagong on July 1. Mechanical and pilot error
have been alleged as cause. No one was seriously injured
but, according to Biman officials, the airplane is completely
destroyed. The pilots have since been suspended from their
jobs at Biman pending the conclusion of the investigation.
Civil Aviation Minister Nasiruddin subsequently met with
Finance Minister Saifur Rahman to discuss purchase of ten new
planes. Rahman has reportedly signed off on the purchase of
four airplanes - two each from Boeing and Airbus. End
Summary.

2. The airplane bound for Dhaka experienced mechanical
problems with its landing gear forcing a crash landing. The
plane caught fire and the passengers had to be evacuated.
Six passengers suffered minor injuries. A five-member
inquiry committee headed by Biman's technical safety director
is investigating the cause of the accident. Blood samples of
the pilot to check for alcohol were collected and allegations
persist regarding his lack of experience and drinking prior
to taking off from Dubai. International flights from the
Chittagong airport were suspended for the week but domestic
flights resumed the next day.

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3. Civil Aviation Minister Mir Muhammad Nasiruddin met with
Finance Minister Saifur Rahman on July 6 to discuss purchase
of new planes and stressed the immediate need for new
aircraft following the accident. The Finance Minister
officially agreed to the purchase of four aircraft initially
and left the door open for further purchases. Rahman said
Biman's operations have to be overhauled before more aircraft
are purchased.

4. According to local media, he asked the Civil Aviation
Ministry to submit a "cost-effective plan" outlining ways to
streamline the national airline. He cited lack of funds as
the primary reason for not approving the purchase of ten
planes at this stage. Civil Aviation Minister Nasiruddin
told local reporters that they have been offered short-haul
Airbus aircraft for $90 million each and long-haul Boeing
777s for $129 million each.

5. Rahman told reporters that the decision to go with Airbus
or Boeing will depend on price. The Civil Aviation Minister
told the Ambassador at a late June meeting that the
Cabinet-level Purchase Committee was reviewing the decision
to purchase 10 new aircraft. (Reftel). The ultimate decision
to purchase would be made by the Finance Minister and hinged
on securing adequate financing. The Finance Minister told
reporters that the BDG is prepared to provide sovereign
guarantee for a maximum of $400 million to secure financing
for the airplanes. This concession is definitely a big step
in moving forward with the purchase of the new aircraft.

CHAMMAS

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