With the order of US President Donald Trump, the Nepal project of Millennium Challenge Corporation (MCC) is in confusion. 10 billion has been spent on the title of MCC so far, but now the payment has stopped.

The Millennium Challenge Account (MCA), which operates the MCC project, has spent 71.7 million dollars so far, 24.9 million dollars from Nepal and 46.7 million dollars from MCC. The mentioned expenditure is up to last mid-December (December 2024). 

The agreement signed between the Government of Nepal and MCC on August 29, 2074 has been implemented since August 13, 2018 after it was approved by the Parliament in 2078. About 5 billion 76 million was spent on both sides in the operation of MCA Nepal office for about 6 years after the agreement. 

In the five years from 2075/76 to 079/80, an average of 88 percent of the total current expenditure has been spent on services and consultancy (consultancy). In the year 2075/76, the total was 898.4 million. This year, the Government of Nepal contributed 9396 thousand and MCC contributed 889 million. Of this, only 317 million was spent on consulting. 

In the year 2076/77, 1 billion 24 million was spent, 93 million 99 million was contributed by Nepal and 30 million 12 million by MCC. Current expenditure this year was 41.64 million out of which 35.48 million was spent on services and consultancy. In the year 2077/78, a total of 2.33 billion was spent, and 1.62 billion was incurred by Nepal. It had running expenses of 382.2 million. Of this, 331.11 million went to the title of services and consultancy. 

In the next year 2078/79, out of a total expenditure of 57 crore 33 lakh, Nepal incurred 19 crore 72 lakh and MCC 376 crore. Out of this, 41.44 million was spent and 35.17 million was spent on services and consulting. In the year 2079/80, out of a total expenditure of 71.74 crores, Nepal incurred 2.49 crores and MCC 69.25 crores. Current expenditure was also high this year. Out of 489 million current expenditure, 405.7 million was under the heading of services and consultancy.

In the initial agreement, it was mentioned that the American government will pay 72 percent, i.e. 500 million dollars, and the Nepalese government will pay 197 million dollars for the project worth 697 million dollars (about 92 billion). In December last year, the US government announced an additional 50 million dollars for the project. 

Transmission lines and substations under MCA have been contracted. A budget of 13 billion 36 crore rupees has been allocated for this project this year. According to which there is 1 billion 238 million rupees current and 12 billion 12 million 15 million rupees capital expenditure. Out of the budget allocated for the current year, the government of Nepal had 3.45 billion 1.8 million rupees and the US had 9.9 billion 90.8 million rupees. But only 8.32 percent of the budget allocated for this year has been spent in the first six months. 

There is a plan to expand about 315 km long electricity transmission line and 70 km road within 5 years under MCC. According to MCA Nepal, contracts have been signed for three substations.

according to which a contract agreement was signed on 081 Baisakh 27 to build New Butwal (Nawalparasi West) substation for 35.5 million 10 thousand dollars. Similarly, a contract agreement was signed on 081 June 1 to build the Ratamate-Nuwakot substation at a cost of 50.16 million dollars. Construction of new Damauli-Tanahun substation at a cost of 38.8 million 90 thousand dollars is being done after signing the contract on 081 July 16.

Under the power transmission project, the contractor has been selected for the 18 km long cross-border power transmission line in July 081. Tenders will be invited again this year for the 297 km transmission line,' MCA Nepal's progress report states, 'Tenders will be invited this year for the 40 km long road section to use full depth reclamation (FDR) technology from Dhan Khola to Lamahi. Two potential road sections have been identified and approved for periodic maintenance. The

road project includes programs such as laboratory upgrading, testing equipment and technical training. According to MCA Nepal, training has been provided to 270 people through the livelihood restoration program, determination committees have been formed in 9 districts to determine land compensation, land compensation has been determined in 3 districts namely Dhading, Makwanpur and Nawalparasi West and the first phase of tree counting has been completed in 9 districts.

After Trump's order, the Ministry of Finance informed that the MCA Nepal program has been stopped in the first week of February. "In the email sent by MCC on February 2, it is informed that the activities to be paid from MCC funds related to the project being implemented under the agreement between the Government of Nepal and the said body on August 29, 2074 have been stopped according to the executive order of the American President on 90 days of suspension issued on January 20, 2025," the Ministry of Finance officially informed in the first week of February. Since then, the work under the MCC has been suspended, said Shyam Prasad Bhandari, spokesperson of the Ministry of Finance. "Since then, nothing new has happened, the same situation as it was then, is still the same," he said. MCC sources said that although the new work has been postponed, the old work is scheduled. President Trump's order has not been paid, new work has not started. But, the old works are being done,' said an official. 

Similarly, economist Rameshwar Khanal says that it cannot be said that the MCC will be stopped because of the support of the US Congress (Parliament) without the support of the US government. In a detailed interview with Kantipur, Khanal, who is also the chairman of the High-Level Economic Reforms Suggestion Commission, said, "The US President's views on issues such as third-sex communities, sterilization, and family planning are somewhat traditional, but there is no need to panic and say anything about the MCC." There is a provision in the contract that either party can withdraw by giving sufficient notice. Now the US is just about to review its cooperation policy. In some cases, we also did such a review. If the program is canceled even after 90 days, Khanal says that Nepal has the legal basis to be part of the liability created by the US government and demand its payment.