Kathmandu, April 5 (IANS) The uproar in Nepal over the government’s decision to award a prestigious passport deal to an Indian company continued Monday with a parliamentary committee summoning Prime Minister Madhav Kumar Nepal for an explanation.

The prime minister, who is facing mounting pressure from the opposition Maoist party to quit, appeared before the Public Accounts Committee of parliament to defend the decision to award the contract for modern passports to the Security Printing and Minting Corporation of India.

Nepal, accompanied by Deputy Prime Minister Sujata Koirala who is also the foreign minister, told the committee the contract had been given to the Indian company due to diplomatic considerations.

The embattled premier also tried to pacify the panel by saying there would be no security lapses.

The parliamentary committee had asked the government twice not to give the contract to the Indian company out of turn but to follow the international bidding procedure it had begun in the past.

Four foreign companies had been shortlisted after Nepal sought international bids to print smart passports – new passports that have to be machine-readable in place of the earlier hand-written ones.

The old passports have to be replaced in order to meet the yardsticks laid down by the International Civil Aviation Organisation (ICAO).

Though the Indian company had quoted a higher sum to print the smart passports, it was backed by the foreign minister, who said going through the tender process would cause a delay and Nepal would miss the ICAO deadline of March 31.

With MPs locking horns with the foreign minister, Nepal failed to meet the deadline. Consequently, from April 1, the government stopped issuing new passports, triggering a fresh crisis in a weak economy that sees hundreds of blue-collar workers going abroad in search of jobs every day.

In a bid to prevent an economic meltdown, the foreign ministry Monday said that new handwritten passports would be issued as a stop-gap measure till the smart passports are delivered.

However, the handwritten passports would have a life span of only five years instead of 10.

An Indian team is already in Nepal to discuss the smart passports. About four million machine-readable passports are expected to be delivered from June-end.

However, the deal may face more hiccups.

The Maoists have threatened they would raise the issue in the winter session of parliament, which started from Sunday.

The former guerrillas are opposing the awarding of the contract to the Indian company.