Ever since it got dragged into the war two-and-half years ago, the Royal Nepali Army has said it needs more soldiers and equipment to fight the Maoists. Today, the army is engaged in the biggest-ever expansion in its history. The country's military spending has shot up to 12 percent of the total budget from 7.3 percent three years ago, according to official figures.

The Royal Nepali Army has nearly doubled its troop strength in the past three years, growing from about 45,000 to 75,000. Under current scenarios, it is expected to reach 150,000 in the next five years. This doesn't include the 20,000 paramilitary Armed Police Force.

Senior army officers defend the expansion, arguing that the forces can't fight a full-scale insurgency on such difficult terrain, guard infrastructure and defend highways with its current strength. "In any classic guerrilla war you need a 10:1 numerical superiority to be able to make an impact," says one senior officer.

However, retired army officers say that given the topography and hit-and-run tactics of the Maoists, no force will be strong enough to win the war. "To believe in a military victory is to live in a dreamland," says one ex-military man. "However large your force, you will still be too thin on the ground."

Despite reports of chronic friction between the militaries of defence and finance, successive governments have denied that the army is putting pressure on the government for more money. Caretaker Finance Minister Prakash Chandra Lohani told us this week: "We have not spent a single paisa more than stated in the budget for security, the army hasn't made any extra demands."

The army says it ideally needs a 800-strong battalion posted to guard each of the 75 district headquarters, but has to make do with a company of 200 soldiers for each. "Nowhere else in the world are companies exposed like this," says one army officer. The army has tried to augment its strength by setting up a unified command and leaving some of its tasks to the Armed Police Force and regular police. The army brass was never happy about being sidelined from the districts by civilian elected governments post-1990, and reluctantly went along with the decision to train and equip the APF.

For the army itself, there is no shortage of recruits. As the numbers of unemployed youth grows, army recruitment centres were swamped last year by men and women eager to enlist. The army is also looking at the post-conflict scenario when it sees a role for itself in inducting ex-Maoists into the ranks.

But even those who agree that a bigger army is needed for security have misgivings that this may make the military politically ambitious. It would not be new in Nepali history, and there is certainly precedence in the region. "There should be no compromise in security," says economist Bishwambar Pyakurel. "But money should not be diverted secretly, everything must be transparent."

The government has admitted that it could only spend 30 percent of its largely donor-sourced budget for development in the last fiscal year. Defence Secretary Bishnu Datta Uprety says the military's expansion is going as budgeted, and denies development monies are being rerouted. "We will continue modernising our troops, and ensure they are well-armed and well-trained," he says. However, independent experts doubt that the official military budget alone could have paid for the huge expansion in men and material over the past three years.

Besides increasing troop size, what is costing a lot of money is new equipment, not all of which is coming in as grants. The army is taking delivery of a second Polish Skytruck ($2.5 million), two Indian Advanced Light Helicopters ($ 6 million apiece) and two Pilatus-BN Islanders with short-landing and takeoff capability for surveillance and special operations. Sources said Nepal will only have to pay 30 percent of the cost of the Indian ALHs, and the Islanders are outright grants from Britain.

Given the vulnerability of the forces to Maoist roadside bombs and remote controlled mines, India has already supplied 70 Mine-protected Vehicles (MPVs) to the army and 30 more are expected soon. India is also taking over as the main supplier of standard issue assault rifles and has already handed over 25,000 Indian-made INSAS (Infantry Small Arms System) rifles with 10,000 more in the pipeline. As with the ALHs, Nepal only pays 30 percent of the cost of the rifles.

Meanwhile, there is a puzzling delay in the supply of M-16s, which the Americans had committed two years ago. After replacing 5,000 of its ageing SLRs with M-16s, the guns suddenly stopped coming. Senior military officers admit privately that they are getting impatient with US dilly-dallying and suspect that New Delhi may have pressured Washington not to go ahead with the deal. The expedited supply of INSAS rifles is seen as confirmation of this.

Army sources we spoke to said the M-16s are much better rifles and its ammunition is more readily available. "The ammunition for INSAS has been a problem," he said.

The Americans get most of the criticism for militarising Nepal, but only a part of the $12 million for rifles, night vision equipment, body armour and military training that the US Senate approved has materialised.

The army has also expanded its ammunition facility in Makwanpur with another plastic explosives manufacturing unit, and senior sources told us some of it is even being exported.