Narayan Upadhyay

Even as a section of people and leaders have raised hues and cries over the Millennium Challenge Corporation (MCC) Nepal Compact, many in the country believe that cash and resource-strapped Nepal should accept the compact and implement the projects under it wholeheartedly to develop its key infrastructure sectors - power transmission lines and road maintenance.  Any failure in accepting and ratifying the significant grant would send ripple across the donor nations that have been extending support to Nepal for decades.

Many political leaders and entrepreneurs have asked Nepali authorities to get the compact endorsed by parliament so that the two sides can kick off the projects of expanding transmission lines and upgrading road networks. Several leaders cutting across the political spectrum have opined that no one should create confusion and controversy, as the MCC is an infrastructure project, for which the Nepal government had signed an agreement on it in September 2017.

No military connection
Former Prime Minister Dr. Baburam Bhattarai went on saying that the MCC had contained no military element. He also assured us that we could cancel the compact with a notice of 30 days if any military or anti-national elements emerged while implementing the project. Nepali Congress senior leader and former Foreign and Finance Minister Ram Sharan Mahat opined the American grant was provided purely for building infrastructure and therefore no one should create controversy over it. 

According to him, all past governments, led by the CPN-Maoist Centre, CPN-UML and Nepali Congress, had expressed their commitments to approve the grant and implement projects under it, therefore the grant with a significant sum must be accepted. Former Foreign Minister Pradeep Gyawali expressed the MCC compact should be brought before parliament and parties should hold free discussions on it.

Several business organisations and their representatives want the compact's early endorsement and implementation. They expressed their dissatisfaction over what they termed "over politicisation of the compact." Nepal Chambers of Commerce, FNCCI and the Confederation of Nepali Industries (CNI) have called on the concerned parties to approve the compact at the earliest because the compact is in the favour of Nepal's development. The compact's vital projects, which aim to expand power supply lines and enhance road networks, which they require promoting products in the country, have encouraged business community representatives.

All these individuals appear correct if we give a cursory glance at the American projects under this grant to launch in Nepal. The $630 million compact programme, which contains $500 million US grant and $130 million investment from Nepal, would complete Nepal’s 400KV East-West transmission line and the Nepal portion of the second cross-border transmission line with India, totalling approximately 300 km of transmission lines. 

Such construction would enable Nepal to provide reliable electricity to homes and businesses, modernise the electricity grid, and support the increased trade of Nepal’s surplus energy. Upgrades to roads accessing the various locations abutting the transmission lines will also take place. Another key part of Nepal receiving the grant is that the world's oldest democratic country offered the huge grant money to Nepal, as the Himalayan nation has met the MCC's requirements of having strong democratic credentials and vibrant human rights records. This announcement from the American grant provider should make everyone happy back home.

However, ever since Nepal signed an agreement to receive the MCC grant, the issue has been blown out of proportion. Although the MCC and American government officials have visited the country for umpteenth of times to clear the air of confusion, some elements of the country are ill at ease over the MCC endorsement. It is interesting to note that almost all major parties and their top honchos, when they took the helm of the government, expressed commitment to endorsing and implementing the MCC projects. But the same leaders expressed their reservations against it once they were out of power. 

It can therefore be called pure politics over a grant that can, according to many, do wonders in expanding Nepal's power transmission lines and road networks. The partners of the ruling coalition have had different views on the grant's ratification. While the Nepali Congress and Prime Minister Sher Bahadur Deuba want the compact to be tabled in the House for its ratification within the deadline, the other two alliance partners - the Maoist Centre and CPN-Unified Socialist - want it to defer at least until local elections that are due in May this year. The main opposition, CPN-UML, first wants to settle its old score - dismissing the Speaker before it okays the tabling of the compact in the House.

MCC Board of Directors Vice President Fatim Z. Sumar, during her visit to Nepal in October last year, had clarified that the MCC grant has no association with the Indo- Pacific Strategy or has any military components. The US government assistant minister, Donald Lu, who visited the country in December last year, also declared that the compact had no military component and asked the Nepali stakeholder to pass the compact or risk losing a huge amount of the grant. Other US government and MCC representatives warned their authorities could scrap the proposed MCC grant to Nepal if the latter failed to ratify it within the extended deadline of February 26 this year.

Common ground
Many think that at this crucial juncture, when MCC has been blown out of proportion by some elements inimical to the idea of receiving any grant from the West, leaders should work out for common ground for ratifying the compact. If Nepal cannot ratify it, it would send the wrong message to America, which has been a close development partner of the country ever since the two countries established their diplomatic relationship way back in the 1950s. In the future, the Americans would think twice before sending their assistance to Nepal. In the meantime, many of the Western countries that have been extending financial and other support to Nepal during fair and rough weather too would see this failure as an act of betrayal to the trust of donor nations. 

(Upadhyay is Managing Editor of this daily.  nara.upadhyay@gmail.com)