Army seeks law revision to widen its investments

Aug 23, 2018-he Nepal Army has approached the Defence Ministry to revise Army Act (2006) that would enable it to widen its investments, a senior official of army welfare forum said on Wednesday.

enable it to widen its investments, a senior official of army welfare forum said on Wednesday.

Speaking to journalists at a press conference in the Capital, Nepal Army Welfare Fund Director (NAWF) Brigadier General Raghu Bhandari said, “The existing Act prevents us from investing as promoter. This is a barrier in widening our investments.”

The NAWF seeks higher return on investment to support incumbent and retired army personnel’s welfare activities, he said.

The Army wants to revise the stipulation in the Act that prevents it from investing funds in energy, financial, business and other sectors, he said.

It is unhappy with the limited interest it earns from the deposit of billions of rupees of NAWF in various commercial and development banks.

The NAWF currently has cash deposit of Rs35.77 billion and investments worth Rs5.52 billion in various sectors.

With the current deposit, it wants to invest in two hydropower projects and in Treasury Bills that would give the welfare fund more returns than it now earns from banks.

It has proposed Department of Electricity Development to build 25 MW Dudh Khola and 32 MW Bhimdang Khola hydropower projects before authorities amend the Act.

Between the two Manang-based projects, the department is willing to open Bhimdang Khola for investors.

A security expert said there should be clarity on where the Army can invest. He said the Army should focus on producing the things it needs rather than engaging in commercial activities. The money it has can be used in manufacturing arms and ammunitions, uniforms and other necessary items.

Security expert and member of House of Representatives Dipak Prakash Bhatta told the Post, when the proposal to amend the Act reaches Parliament, there would be thorough discussion on the issue. The Cabinet has to approve the amendment to the Act before the federal parliament endorses it.

Bhatta said the Army, whose primary job is security, should not pursue activities that expose it to controversies. Its acts of leasing Tri-Chandra Military Hospital for business, running petrol stations in the country and selling land plots to its staff have exposed it to controversies and accusations of ‘focusing on commercial gains’.

Amending the Act would increase the Army’s commercial activities, the expert said.