Thursday 25th April 2024
The Nepal government submitted a USD 500 million grant agreement in the Parliament Secretariat on July 16, 2019.
The grant agreement signed by Nepal and USA is a part of the Compact Program designed by Millennium Challenge Corporation (MCC) – an independent foreign aid agency of the US Government.
It was originally signed by then Nepal Finance Minister Gyanendra Bahadur Karki and MCC CEO Jonathan Nash in Washington DC on September 14, 2017.
The grant will be used to build energy and transport network in Nepal, helping the country draw more foreign and domestic investment.
The grant has to be approved by the Federal Parliament before being implemented.
As per the agreement, MCC will provide Nepal with USD 459.5 million as program funding and USD 40.5 million as compact CDF. The US grant will support two projects in Nepal:
Electricity and road infrastructure are the two main obstacles in the path of Nepal’s development.
Besides, the fund can also be used for financial management and procurement activities; administrative support expenses, such as rent and several other areas that go into implementing the agreement in accordance with MCC.
The MCC board of directors chose Nepal for the compact program because of the country’s efforts to establish rule of law and democratic institutions. Nepal’s strong performance on all MCC policy criteria was another factor why MCC chose the Himalayan nation for this special program.
The Nepal Government will also be investing USD 130 million for the specialized program.
