Bijay Damase

July 31: The funds maintained by security forces have around Rs 75 billion. The welfare funds of the Nepalese Army, Nepal Police among other security agencies have such a huge fund which is not invested anywhere.

The security agencies are unable to mobilize the fund even during the time of financial crisis because of a provision that does not allow the security forces to invest the fund in profit-generating ventures.

The size of army’s welfare fund, which was established  years ago with just Rs 12. 4 million, has currently expanded to Rs 69 billion. Out of the total amount, Rs 62 billion has been deposited in various banks. The Army Act has a provision under which the national army itself cannot invest its funds in profit-generating business.

Therefore, the army which has been paying an annual tax of Rs 500 million has not invested its money in any business, informed any army source. Next year, the army’s welfare fund will get an additional fund of Rs 20 billion.

The Nepalese Army has invested around Rs 6 billion to operate medical college, school, petrol stations and drinking water for the army in line with the Army Act.

Around Rs 900,000 generated from such non-profit business is used for the welfare of the families of serving and retired army personnel.

Around 5,400 army personnel deployed in 12 different missions of the United Nations bring around USD 150 million back to Nepal each year.

The recent report of the Auditor General states that the army’s petrol station and fair-price shops operated under the welfare fund do not go through annual audit. The report also suggests that the  income generated from the fund should be invested in productive sector.

Nepalese Army Spokesperson Brigadier General Narayan Silwal says that the army has been investing the money of the welfare fund in necessary areas in line with the Army Act.

“The army is ready to invest in the productive sector if the government amends the law,” said Silwal.

Similarly, Nepal Police also has its welfare fund worth around Rs 3.61 billion. This amount is also yet to be invested in productive sector. The fund is deposited in bank and the police force reaps the benefit of interest.

The Armed Police Force also had established its fund almost two decades ago. The welfare fund of APF has around Rs Rs 2 billion. This amount is also not invested anywhere.

Although efforts have been made to bring these funds in the capital market, it has not been possible so far.