The Fishtail Air helicopter carrying six passengers lost contact with air traffic control tower shortly after it took off from Gorkha this afternoon.
The chopper, which was flying the new-born for a treatment in Kathmandu with her mother, crashed at Bhatine Danda area in Nuwakot district, 150 km west of Kathmandu, officials said.
All seven people, including pilot Ranjan Limbu, on board the 9N-AKA helicopter were killed, the Civil Aviation Authority of Nepal (Caan) said.
The cause of the crash was yet to be probed. "Without an investigation, we cannot tell what caused the accident," Ramesh Shiwakoti of the Fishtail Air said.
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In Nepal, air travel is hugely popular as there is only a limited road network.
The country has suffered a number of air disasters in recent years, affecting the tourism industry.
In February, 23 people on board a small plane were killed after their aircraft crashed in a remote mountainous region amid poor visibility.