Even as construction of the much-awaited Nagdhunga Tunnel Road nears completion, its commercial operation remains stalled, with uncertainty over the selection of a service provider. Ten foreign companies have now expressed interest in operating and managing the tunnel, highlighting both the project’s strategic importance and the complexities delaying its launch.

According to Sanjay Panthi, undersecretary of the Nagdhunga Tunnel Road Project, applications were submitted by six Chinese companies, three Indian companies, and one Turkish company within the stipulated deadline. “The evaluation process to select one company is currently underway,” Panthi said, adding that a decision is likely within a month.

Under existing provisions, the selected foreign company will be required to partner with a Nepali firm - a mandatory condition intended to ensure local participation in the tunnel's operation and management.

The process, however, has not been straightforward. The Department of Roads (DoR) had to extend tender deadlines several times in its attempt to appoint a service provider. While the final deadline was set for mid-January, earlier deadlines had been fixed for December 17 and later extended to December 31, reflecting the challenges faced in finalizing an operator.

Adding to the uncertainty are differing accounts regarding conditions imposed by project financiers. A departmental source claimed that the Japan International Cooperation Agency (JICA) - which provided loan assistance for the tunnel - has stipulated that a Chinese company should not be selected as the operator. A senior DoR official said that although two Chinese companies submitted bids, JICA’s alleged condition has complicated the selection process.

The official further said JICA has urged the department not to select companies that have been blacklisted internationally. However, Panthi dismissed claims that JICA had formally imposed a restriction against Chinese companies, insisting that such allegations are not true.

Meanwhile, the Tunnel Operation and Management Procedure, prepared by the DoR to govern the operation, maintenance, and management of the Nagdhunga tunnel road, was approved in October last year, laying the legal groundwork for the project’s eventual operation.

Senior officials acknowledge that delays are partly due to Nepal’s lack of prior experience in operating tunnel infrastructure. “This is Nepal’s first tunnel operation, and that itself has been a learning process,” a senior DoR official said. “Now we have gained experience. Future tunnel projects will not face such delays.”

Initially, officials believed that the Road Division Kathmandu could temporarily operate the tunnel. However, that plan proved impractical. “Operating the tunnel requires at least 120 permanent staff,” the official said. “With the current workforce, this is not possible. Creating additional posts is a complicated process. That is why operating the tunnel through a service provider company has become the only viable option.”

Despite more than 98 percent of construction work being completed, the tunnel has yet to come into operation solely due to delays in selecting an operator. Panthi said the construction work reached 98 percent completion about one and a half months ago, a stage that effectively marks the completion of construction. An engineer at the Ministry of Physical Infrastructure and Transport (MoPIT) noted that infrastructure projects are generally considered complete once 90 percent of the work is finished.

Construction of the Nagdhunga tunnel began six years ago with the aim of easing chronic traffic congestion at Thankot and Nagdhunga, one of the busiest entry points into Kathmandu Valley. The government had earlier announced plans to open the tunnel on a trial basis during Dashain and even carried out promotional activities. However, that plan fell through. A subsequent announcement to begin commercial operation from January 1 also failed to materialize. The government now says it is preparing to open the tunnel from the Nepali New Year 2083 BS.

Once operational, the tunnel is expected to significantly ease traffic flow, eliminating hours-long congestion for vehicles entering and exiting Kathmandu. Vehicles using the tunnel are expected to cover the stretch in about half an hour, offering a major improvement in travel time.

According to the DoR, the tunnel will shorten the route by 2.5 kilometers, reducing the distance between Balambu and Sisnekhola from 7.5 kilometers to five kilometers.

Under Cabinet-approved guidelines, toll charges for vehicles using the Nagdhunga–Sisneri tunnel road will range from Rs 50 to Rs 500, depending on vehicle type. Motorcycles and vehicles carrying flammable materials such as petrol and diesel will not be permitted. Proposed toll rates include Rs 50 for small vehicles, Rs 200 for buses, and up to Rs 500 for large trucks. Different charges have also been proposed for vehicles entering and exiting through the tunnel.

The guidelines further specify that the company or entity collecting tolls will be responsible for managing critical facilities inside the tunnel, including electricity supply, oxygen and ventilation systems, fire control, security, and communication services.

A MoPIT official said delays in drafting regulations were inevitable, given that this is Nepal’s first experience operating a tunnel of this scale. “We are learning from this project,” the official said. “It will make future tunnel projects easier and faster.”