KATHMANDU: The Nepali Army has unveiled plans to mobilize its Welfare Fund in a way that contributes to national development, with an initial focus on investment in hydropower and solar energy projects.

Speaking at the Ministry of Defense’s fourth-quarter and annual progress review meeting on Thursday, Chief of Army Staff General Ashok Raj Sigdel said the Army is exploring ways to ensure that the Welfare Fund supports both national development and the long-term sustainability of welfare programs.

“We are looking for options to spend our Welfare Fund in a manner that contributes to national development,” General Sigdel said. “Our objective is to ensure that the nation benefits while the fund is also utilized in a productive and meaningful way.”

He said the Army plans to begin with pilot investments in hydropower and solar projects aimed at electricity generation. If the model proves successful, the fund could later be invested in broader infrastructure and development projects.

According to General Sigdel, the Welfare Fund currently holds assets worth approximately Rs 97 billion, including about Rs 91 billion in cash deposits in banks and around Rs 6 billion in existing investments. The fund is legally allowed to spend up to 90 percent of its income, but declining bank interest rates have created challenges in sustaining welfare expenditures.

At present, around one million beneficiaries receive health services through the fund, while approximately 11,000 students benefit from educational support. Major beneficiaries include soldiers, former servicemen, and their families. Educational assistance covers schooling up to Grade 12 as well as higher and technical education, including MBBS and engineering studies.

General Sigdel stressed that expenditures from the Welfare Fund remain primarily focused on the welfare of serving and retired military personnel.
He also expressed confidence that progress on the Kathmandu–Tarai/Madhes Fast Track project, which is being constructed under Army management, would improve significantly in the coming year as efforts are underway to resolve existing obstacles.

Contractors failing to meet deadlines will be given a limited period to improve performance, he said, warning that contracts could be terminated if progress remains unsatisfactory.
The Army chief said early approval of the third revision of the Detailed Project Report (DPR) and the launch of remaining construction packages are essential to complete the project on schedule. Delays in land acquisition and compensation distribution in the Khokana section have affected overall implementation.

According to the ministry, project progress has also been hindered by delays in land acquisition, tree felling, compensation payments, contractors’ design submissions, equipment management, and the inability to begin construction in the Khokana segment.

General Sigdel said the Army has the capacity to utilize a larger capital budget effectively and argued that adequate funding would enable faster progress on strategic roads and development projects. He noted that limited budgets have prevented full utilization of the Army’s manpower and equipment in some road projects.

In the last fiscal year, the Fast Track project achieved 63.70 percent physical progress and 71.82 percent financial progress against annual targets. Cumulative progress has reached 48.72 percent physically and 50.62 percent financially.

The ministry said seven development projects under its jurisdiction achieved 100 percent progress during the previous fiscal year. These include the Khadbari–Kimathanka Road, Karnali Corridor, Benighat–Arughat–Larke Bhanjyang Road, Darchula–Tinker Road, Bunker to Barrack Program, National Defence University, and the President Chure Conservation Program.

Of the Rs 66.88 billion allocated to the Ministry of Defence and its agencies for recurrent and capital expenditure last fiscal year, Rs 63.54 billion was spent, resulting in about 95 percent financial progress. Capital expenditure reached 74.6 percent, while recurrent expenditure stood at 97 percent.

Army-managed development projects provided employment to 1,127 people, and hospitals operated under the Army delivered health services to 976,286 individuals.
Outstanding audit arrears up to fiscal year 2082/83 stood at Rs 10.70 billion, of which 54 percent has been settled. The remaining unsettled amount is Rs 4.94 billion, according to the ministry.
Defense Secretary Kedar Nath Sharma said progress on the Fast Track, a national pride project, has not met expectations and directed officials to accelerate construction to achieve future targets.

He thanked the Army for meeting targets in other national corridor projects and praised its work in disaster search, rescue, and rehabilitation operations.
The meeting was attended by representatives from the Office of the Prime Minister and Council of Ministers, the Ministry of Finance, the Ministry of Industry, Commerce and Supplies, the Ministry of Forests and Environment, the National Planning Commission, and chiefs of various development projects under the Nepal Army.