Controversy Over Government’s Decision to Allocate Two Percent of Hydropower IPO Shares to Security Personnel

Experts have expressed concerns that advancing the legal process to allocate two percent of the initial public offering (IPO) shares of a hydropower project to security personnel deployed in post-flood relief and rescue operations is inappropriate. Energy, Water Resources and Irrigation Minister Biraj Bhakta Shrestha praised the work of serving security personnel and stated that the legal steps to grant such a benefit are underway. However, experts argue that providing this measure just to appease those assigned various responsibilities is misguided.

Following the devastating flood in Bhote Koshi-Trisuli on September 10, a large number of security personnel were deployed for rescue and search operations. According to the National Disaster Risk Reduction and Management Authority, approximately 21,000 security personnel from the Nepal Army, Nepal Police, and Armed Police Force were mobilized. Addressing the House of Representatives on Wednesday, Minister Shrestha remarked that the scheme was being introduced to acknowledge the security forces’ role during the catastrophic flood along the Bhote Koshi-Trisuli river.

Former Finance Minister and Secretary Rameshwar Khanal disagreed with providing such benefits to the security personnel, stating that this approach goes against their best interests and cannot be justified. Similarly, former Chief Secretary Bimal Koirala characterized the decision to allot two percent of the hydropower IPO shares to security personnel as merely an attempt to appease them.

Companies issuing shares to the general public is referred to as a primary share issuance (IPO). Former Finance Minister Khanal explained that in Nepal, people are particularly attracted to IPOs because shares bought at 100 NPR often increase in value rapidly, yielding profits. Although it is not certain that security personnel would benefit financially from the IPO shares, providing them with this privilege is viewed as granting a concession and preferential treatment.