Says agreement cannot be amended at this time


Millennium Challenge Corporation of United States today sent its responses to the questions from Nepal government clarifying that Nepal's constitution prevailed over the MCC agreement, but the agreement could not be amended at this time.

The US Embassy in Kathmandu made available the contents of the US responses sent to Minister of Finance Janardan Sharma.

Fatema Z Sumar, Vice-president of Department of Compact Operations, US, wrote to Sharma saying the MCC remained committed to having open and transparent dialogue with the people of Nepal and saw this exchange as a positive step towards ratification of the MCC Nepal Compact.

She said MCC Nepal compact was a continuation of US-Nepal mutual friendship and underscored the government of Nepal's commitment to democratic principles and building a better future for all Nepalis. Grants, assistance, gifts, etc. do not generally come with conditions between the donor and recipient countries, she stated.

The US side responded to each question of Nepal government stating there was no connection between Nepal MCC compact and military alliance or defence strategy. Nepal was selected for the project on the basis of its scorecard that focused on just and democratic governance, investing in people and economic freedom.

Stating that all the projects were selected by Nepal, the US said the constitution of Nepal prevailed over the MCC agreement.

The status of international agreement means implementation of the agreement will proceed in accordance with the laws of Nepal, except in the rare instance where local law conflicts with a specific provision of the compact.

In such a case, compact provisions will be implemented according to mutually agreed upon terms and the constitution of Nepal. Nepal's Ministry of Law, Justice and Parliamentary Affairs concluded that the agreement should be ratified by the Parliament.

The US said the MCC agreement signed in 2017 cannot be amended at this time. MCC is not an agreement under Indo-pacific strategy, nor is it any part of US military strategy. It said the Auditor General of Nepal can conduct audits of MCA Nepal and has already done so.

The US side clarified that MCC Nepal compact did not affect or limit Nepal's sovereign right to sign assistance or investment agreements with any other country. Both US and Nepal have the ability to terminate the agreement with 30 days' notice.

The US stated that immunity for MCC employees was the standard in diplomatic relationship and that immunity from court jurisdictions applies only to claims and losses arising out of activities or omission under the compact.

The US side has also sent a copy of the response letter to Prime Minister Sher Bahadur Deuba.

A version of this article appears in the print on September 9 2021, of The Himalayan Times.