MCC fund will be accepted only after ratification: Finance Minister

MCC Compact

KATHMANDU, June 1: The government will accept the fund from the Millennium Challenge Corporation Compact only after it is endorsed from the parliament, clarified Minister for Finance Yuba Raj Khatiwada.

Although the US Program is yet to be approved by the parliament, the government has included the MCC in its budget for the fiscal year 2020/21. The MCC has gained a place in Nepal’s budget for the last two years since the $500 million grant deal—highest ever US grant– was signed in 2017.

The projects Lapsiphedi-Ratamate-Hetauda and Lapsiphedi-Ratamate-Damauli-Butwal 400kV transmission lines under the MCC deal was included in the government’s policy and programs for the fiscal year 2020/21.

“The budget and programs related to the MCC Compact will be implemented only after the parliament ratifies the deal,” said Khatiwada responding to lawmakers’ question on inclusion of the deal in the budget on Monday.

After the MCC was included in the budget, the ruling Nepal Communist Party Secretariat Sunday decided the put the MCC projects on hold unless ratified and had asked the Finance Minister to clarify the issue in the parliament.

“The MCC was included in the budget in the previous years as well. The deal has been included in the budget 2020/21 as well. But it will remain as it is if the parliament does not ratify it,” he added.

The MCC was sent to parliament for ratification in June last year but the deal has not been tabled due to the sharp divisions in the ruling party over the US program.

Especially NCP leaders Bhim Rawal and Jhala Nath Khanal are against endorsing the deal in its current form.

But Prime Minister K P Sharma Oli and the main opposition party Nepali Congress has stressed on it ratification without further delay.

The entry into force date for the MCC Compact is set for June 30.