NA opens LC to procure weapons worth Rs 6 billion from China
25th May 2023
The Defense Ministry, the Defense Minister, and the Nepali Army have opened a letter of credit (LC) worth 6 billion to purchase arms from a company under the Chinese government, amid heated controversy. Now is the time to inquire about the reasons behind the army’s decision to buy weapons from a company known for producing controversial and inferior weapons worldwide.
The army intends to procure weapons from China’s North Industries Corporation (NORINCO), and sources confirm that the LC has been opened for this purpose.
On April 17, 2023, the Nepal Army composed a formal letter addressed to Himalayan Bank Limited, seeking to initiate the process of opening a Letter of Credit (LC). However, due to certain imposed restrictions, the bank encountered delays and was unable to commence the required procedures promptly. Consequently, the bank has now approached the Nepali Army, requesting them to promptly submit the essential documentation to proceed with the LC process.
The arms procurement process from China was initiated during the tenure of the former Prime Minister, Sher Bahadur Deuba. However, the process remained incomplete as the government changed. The current government has now resumed the same process.
The Nepali Army plans to acquire 26 Armored Personal Carriers (APCs), 94 tactical vehicles, and 12.7 mm bullets from NORINCO. The payment for these purchases will be made from the welfare fund. Additionally, four APCs will be purchased from India’s Mahindra Company. The Chinese APCs are estimated to cost Rs 775 million per unit, while the Indian APCs will cost approximately Rs 40 million per unit, as per the sources.
For more than ten years, Kenyan soldiers have been battling the Al-Shabaab terrorist group in Somalia, working alongside African Union forces. Following the investigation, it was determined that the APCs provided by Norinco, a Chinese defense contractor, were found to be defective and unsuitable for use in the conflict.
Kenya had purchased a total of 30 Norinco VN4 APCs from Beijing. Experts who examined the procurement process of the APCs reported that the Chinese-made vehicles were incompetent and inadequate for the purpose they were intended for.
The reason for the Nepali Army’s pursuit of weapons from China, despite the aforementioned concerns, appears to be the commission being offered by China. It has been reported that Lokendra Karki, a Nepali agent, is acting as a middleman to bring arms from China at a price higher than the market price. Lokendra Karki is the brother of Nepali Congress leader and former minister Gyanendra Bahadur Karki.
The Nepali Army had previously procured weapons from Korea, but issues with the equipment led to their search for China. Notably, the Chinese company had earlier been represented in Nepal by Umesh Shrestha and Roshan Shrestha before Karki took over their role upon their expiration.
However, Defense Minister Purna Bahadur Khadka is behaving as he is unaware of this particular case. Just a few days ago, he attempted to clarify his non-involvement through a social media post. In his statement, he mentioned that his name had been included in the arms allocation meant for the army, but he emphasized that this assertion was not true.
From the past few days, various news outlets have been linking my name to the purchase of weapons by the Nepali Army, which has drawn my serious attention,” said Khadka in a statement on social media. “I want to make it clear to everyone that since I became the Defense Minister, there has been no decision regarding the purchase of weapons from the Ministry of Defense.” The Army also seems to be unaware about the purchase of weapons.
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Chinese APCs with poor battlefield performance being procured by Nepali Army
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