Given the huge volume of grant assistance the US is providing under the MCC, Nepal can ill afford to lose it for her development

Even as the government is all set to endorse the Millennium Challenge Corporation (MCC) Nepal Compact Programme by the Federal Parliament during the ongoing winter session, a new debate has now surfaced whether the US assistance is a part of the broader Indo-Pacific Strategy (IPS) put forth by the US. The US is providing US$ 500 million to Nepal under the grant assistance for the construction of high voltage transmission lines and upgradation of the existing strategic roads to give a boost to the national economy. Then finance minister Gyanendra Bahadur Kakri had signed the deal in Washington on September 14, 2017, well before the USA came up with the IPS – an economic, good governance and military and defense cooperation pact among the member states in the Indo-Pacific region. Nepal will also have to contribute US$ 130 million as matching fund to the MCC. The differences of opinion regarding the MCC surfaced during the weeklong standing committee meeting of the ruling Nepal Communist Party. Some of the NCP members claimed that it was a part of the IPS while Foreign Minister Pradeep Gyawali insisted that it was not, as the MCC was envisaged in 2004 while the IPS came into being only in 2017. NCP Co-Chair Pushpa Kamal Dahal said that the MCC could be taken for implementation only after the US clarified that it is not a part of the IPS.

Some of the clauses in the MCC are contentious. The MCC agreement demands endorsement from the Federal Parliament whereas constitutional experts believe it is not necessary to have it passed through the Parliament. Article 7 (7.1), for example, states that after the said agreement comes into force, it shall prevail in case it contradicts Nepal’s law. Likewise, Article 3 (3.8 a) requires auditing of the MCC project be carried out only by a US firm. Since Nepal is also putting in money to the project, Nepal’s Office of the Auditor’s General should also have the right to carry out the project’s auditing. Likewise, Article 5 (5.1 a and b) states that the US government can terminate the deal at any time by giving a written notification to Nepal. But Nepal cannot do so. These are some of the controversial clauses that need to be rectified before Nepal’s Parliament endorses it.

Foreign Minister Gyawali is insisting that the MCC should not be looked at from the IPS perspectives. Some of the countries in Europe, Central Asia, West Africa and Latin America have also joined the MCC in the same manner as Nepal and Sri Lanka have done. As the dispute has already surfaced, both the US and Nepal must sit together and sort out the differences. It shows there are some lapses that should be resolved before it comes into implementation. On the other hand, the US government also needs to clarify the doubts raised about the MCC. As a non-aligned country, Nepal has clearly stated that it cannot be a part of any military alliance. However, given the huge volume of grant assistance that the US is providing, Nepal can ill afford to lose it as it will help overall development of the country, especially in the energy sector and better road connectivity. With the grant assistance, Nepal will also acquire new technology and management skills. The MCC must take off for the mutual interests of both the countries.

Retaining students

The school enrollment campaign might be a success, but retaining the students until they complete secondary school is proving to be a challenge, with children dropping out mid-way, especially those coming from the Dalit communities. This has been the case of children from the Musahar and Bantar communities in the Tarai district of Mahottari. Enrolling and retaining have been particularly difficult in the case of the girl child. Having a provision for free education in the new constitution is not enough to improve learning among the Dalit and poor children if they do not see any value in attending school.

There are many reasons why children drop out of school, and they are not limited to illiteracy among the parents and poverty at home. The attitude of the teachers towards the Dalit children could be a prime factor. Given the family environment back home, such children need extra attention and encouragement if they are to perform at par with their better-off classmates. Mid-day meals for the poor students could be an incentive to attend school. In the later years, a vocational skill will prove much more productive than studying subjects students will never make use of in their life.

Letter to the Editor

Clarification by MCA-Nepal

Our organisation’s attention has been drawn towards an editorial published in your reputed news daily on December 23 entitled “Clear the confusions” that had some factual inaccuracies with regard to the Millennium Challenge Corporation (MCC) Compact clauses.

Firstly, the editorial mentions MCC agreement demands endorsement from the Federal Parliament whereas constitutional experts believe it is not necessary to have it passed through the Parliament. The truth is the Government of Nepal decided to send it for Parliamentary ratification after a well-thought legal opinion and thorough consideration by the Ministry of Law, Justice and Parliamentary Affairs. Additionally, all MCC Compacts worldwide are implemented only after a Parliamentary ratification.

Secondly, it mentions that Article 3 (3.8 a) requires auditing of the MCC project to be carried out only by a US firm. This is totally false. The last sentence of the same article states that the Auditor General of Nepal can audit it at any given time. Also, the Formation Order issued by the Government of Nepal clearly mentions in Section 11 that MCA-Nepal will be audited by the Auditor General of Nepal.

Thirdly, it mentions that Article 5 (5.1 a and b) states that the US government can terminate the deal at any time by giving a written notification to Nepal. But Nepal cannot do so. This is highly untrue. The same article also states that either party can terminate the Compact without cause by giving 30 days’ prior written notice.

MCA-Nepal, established under Nepal’s own legislative process, entrusted with and committed to delivering the Millennium Challenge Corporation (MCC) Compact, requests a reputed daily such as yours to report to the public the above facts with due diligence.

Khadga B Bisht

Executive Director

Millennium Challenge Account (MCA)-Nepal