Defense Ministry for paying up Rs 2.4 b for arms from India

Published On: June 15, 2016 12:55 PM NPT By: Kamal Pariyar

Wants to purchase arms, logistics on price-ceiling basis

KATHMANDU, June 15:The Defense Ministry is preparing to clear long pending dues of Rs 2.4 billion for arms and other military purchases from neighboring India, in an attempt to expedite a new purchase model based on a price-ceiling approach.

After repeated follow-up by the Indian authorities to pay the amount due, the Defense Ministry is preparing to press the Ministry of Finance over the matter after briefing Defense Minister Bhim Rawal at the earliest. 

Ministry of Finance had been lingering over the payment for the procurements, considering that the dues could be waived by the government of India as in the past once Nepal makes an official request. India had waived about Rs 2 billion in due amounts during a visit there by then prime minister Girija Prasad Koirala.  
The government of Nepal, during the 12th meeting of the Nepal-India Bilateral Consultative Group (BCG) on security issues held in India on 9th June, assured India about payment of the due amount before initiating a new deal with India for military procurements. 

"During the BCG discussions, we floated a new procurement model for military supplies and assured them of payment of the existing dues before initiating any new deals,” said Joint Secretary Shiva Prasad Shimkhada, the Defense Ministry spokesperson and one of the participants in the bilateral talks.

Nepal had been purchasing arms and other military supplies from India for the past several years in a uniform formula that includes 60 percent grant and 40 percent cash payment. "We have now  requested India to raise the ceiling of their grant to 100 percent beforehand and we will use the 40 percent amount for purchase of other military supplies from them," he said. 

But Nepal is not bound to purchase the supplies from India if those items can be purchased at cheaper rates from other countries as per the Procurement Act, spokesperson Shimkhada said.

“The Indian authorities are yet to respond to our proposal,” the official said.

During the BSC meeting, Nepal also made clear its stance on not purchasing the India-made Insas rifle that is considered to be outdated and third rate. Nepal has asked the Indians to offer a better alternative to the Insas, which is  now in use by the Nepal Army and the Armed Police Force.   

The bilateral meeting has also discussed issues relating to trainings and joint exercises, information sharing between the two militaries, exchange of experts and instructors, cooperation in disaster management, and other matters of mutual security concern. 

The Nepal delegation was led by Joint Secretary Prakash Kumar Subedi of the Ministry of Foreign Affairs and the Indian delegation by his counterpart, Joint Secretary Abhaya Thakur.

The delegations comprised officials from the Defense Ministry and representatives of the Nepal Army and the Indian Army.

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