The US government has indicated that it will continue to support the Millennium Challenge Corporation (MCC). In a statement issued by the American Embassy in Nepal on Wednesday, it is mentioned that the MCC Nepal program is expected to continue.

In February 2025, the US government decided to suspend foreign aid for 90 days. In that decision, a special exemption was given for MCC Nepal Compact as an exception.

According to the concession, the MCC Nepal Compact has been given the right to continue with its full implementation.

Earlier last March, MCA Nepal had said that the American government had granted permission to proceed with the project under MCC. "The US government has given permission to proceed with some of the activities under the MCC Nepal Compact, this permission does not indicate any specific outcome of the review," said a statement issued by MCC Nepal.

Following the order of US President Donald Trump, the project of Nepal was confused due to the steps taken by MCC. On February 2, MCC sent a letter to the Government of Nepal and informed that the payment would be stopped. Last March, MCC Nepal said that the same postponed project would be restarted.

MCA Nepal is a program under MCC. According to the agreement between Nepal Government and MCC on August 29, 2074, the project implementation started from August 13, 2080. In the initial agreement, it is mentioned that the US government will bear 500 million dollars and the Nepal government will bear 197 million dollars for the 697 million dollars (about 92 billion) project. Last December, the US government announced an additional $50 million for the project.

Under MCA Nepal, 18 km Butwal-Gorakhpur transmission line, 400 kV new Butwal substation, 400 kV new Damauli substation and 400 kV Ratamate substation are under construction. According to MCA Nepal, the proposal received by calling for 297 km transmission line and 40 km contract from Dhankhola to Lamahi is being evaluated.

MCA Nepal signed an agreement with Transrail Lighting Limited on August 14, 2081 for 12.23 million 60 thousand US dollars to build an 18 km transmission line in Nepal under the Butwal-Gorakhpur international transmission line. According to MCA Nepal, the initial phase of the transmission line is being completed in 21 months.

MCA Nepal says that it has paid 167.9 million 32 thousand 962 rupees to Transrail Lighting Company so far for Butwal-Gorakhpur transmission line. Detailed survey, geo-technical investigation and preliminary work of site construction of the new 400 KV capacity Damauli substation under construction in Tanahun is underway. 

An agreement was signed with India's Techno Electric and Engineering Company on July 16, 2081 for the construction of the new Damauli substation. 52 crore 21 lakh 5 thousand 354 rupees have been paid to the company that got the contract. 

An agreement was signed on June 1, 2081 with India's Techno Electric and Engineering Company Limited to build a 400 KV Ratamate substation in Nuwakot. The substation was built within 39 months for 50.16 million US dollars. According to MCA Nepal, work is being done to finalize the preparations before proceeding to the design and construction of the substation and the company has been paid 6997,732 rupees so far.

An agreement was signed with Linkson India on 27 Baisakh 2081 to construct a new 400 KV Butwal substation at Nawalparasi (Bardghat Susta West). The substation, which aims to be completed within 39 months, was contracted for 35.5 million 10 thousand dollars. According to MCA Nepal, 47 crore 27 lakh 70 thousand 576 rupees have been paid to the company that got the contract.

MCA Nepal had invited bids again on December 12 to build 297 km of electricity transmission line. The bid had a deadline of February 7, 2081. Nine companies have submitted bids to construct three transmission lines, and the proposal is currently being evaluated.