By Our Reporter
Despite strong opposition from a few leaders of the ruling parties and many of those associated with the Socialist Front of the four ruling parties, the Millennium Challenge Corporation (MCC)-Nepal Compact, a U.S.-funded project to develop 315 km transmission lines and upgrade 300-km long road project, entered into force from August 30.
Although Netra Bikram Chand of the Nepal Communist Party one of the components of the Socialist Front threatened to quit the Front if the MCC got endorsed and Jhalanath Khanal of the CPN (Unified Socialist) strongly objected to the implementation of the MCC, it has finally come into force, and it will remain for the next five years.
MCC Vice-president of Compact Operations Cameroon Alford arrived in Kathmandu for the inauguration of the MCC, just days before Prime Minister Pushpa Kamal Dahal was to fly to China on a visit.
Finance Minister Dr. Prakash Sharan Mahat and Alford exchanged a memorandum of understanding on Wednesday last week and announced the official launching of the US$ 697 million ($500 million U.S. grant and $197 million matching fund from Nepal government) project, 18 months after Nepal’s federal parliament endorsed the MCC pact on February 27, 2022, along with a 12-point controversial interpretative declaration.
In a press statement, the U.S. Embassy in Kathmandu said that Nepal’s constitution would prevail while implementing the MCC projects. The projects should be completed within five years, failure to which will lead to the closure of the fund to be provided by the U.S. government. However, both Nepal and the MCC officials are silent about the future of the projects if they are not concluded within the time.
As per the understanding, the allocated fund will be utilised to build a 315-km-long 400kV transmission line from Lapsiphedi in Kathmandu to New Butwal via Ratmate in Nuwakot and Damauli in Tanahun.
The MCC was dragged into controversy stating that the US could make the project a pretext to stay in Nepal forever. They also argued that the project would irk China, the northern neighbor unnecessarily. There were even some who claimed that China had funded the anti-MCC protest in Nepal.
But, now it has come into effect.
Moreover, the Nepal visit of MCC Vice Chair Alford in the name of launching the project, which happened on the eve of PM Dahal’s China visit, looks meaningful.
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