The US government has decided to continue the program in Nepal under the Millennium Challenge Corporation (MCC). Last week, the American government decided to allow the Millennium Challenge Account Nepal Development Committee (MCA Nepal) to operate without interruption, according to the American Embassy in Nepal.

"The US government's foreign aid review has recommended the continuation of the implementation of the MCC Nepal agreement, we have informed the Nepal government about this decision," the US embassy said, "the MCC agreement worth $500 million and the additional $19.7 million contribution of the Nepal government will help in prosperity and regional energy promotion through the construction of electricity transmission infrastructure and improvement of the road network."

The embassy has formally informed the government of Nepal about this decision. The president and finance secretary of MCA Nepal Ghanshyam Upadhyay says that he received information from the American embassy through an official letter regarding the promotion of MCA Nepal. "In the embassy's letter, it is said that the US government's assessment work has been completed and the decision to proceed with the program has been made. Now the confusion regarding the continuation of the program under the MCC has been removed," he said.

On June 19, MCA Nepal welcomed the US government's decision to allow the implementation of the MCA Nepal Compact under a special exemption regarding the suspension of US foreign aid. However, at that time, the US government had not completed the "review" of the MCC program. With the completion of the review, the US government decided to continue the MCA program last Thursday. Based on the same decision, the American Embassy in Nepal informed the Nepal government through a written letter on Friday.

MCA Nepal has completed the procurement process related to the construction of 297 km power transmission line and road maintenance and has coordinated with MCC for the implementation of the project. "MCA Nepal is continuing the work related to the construction of three substations and 18 km cross-border transmission line, which had been started before the review of foreign aid," said a statement issued by MCA Nepal last June.

After the American government decided to suspend foreign aid for 90 days in February 2025, the project run in Nepal under MCC was also confused. On February 2, MCC sent a letter to the Nepalese government informing them of stopping the payment. But last June, the US Embassy in Kathmandu issued a statement saying that the US government had given special concessions to Nepal and expressed hope that the MCC project would continue. The statement of the embassy was welcomed by MCA Nepal. Now the US government has officially decided that the project will continue.

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 American 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 dollars 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 for the Butwal-Gorakhpur transmission line. Detailed survey, geotechnical investigation and preliminary work of site construction of new 400 KV capacity Damauli substation under construction in Tanahun is going on.

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, preparations are being made to finalize 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). Within 39 months  The substation with the goal of completing the

was contracted for 35.5 million 10 thousand dollars. MCA Nepal has already paid Rs 47 crore 27 lakh 70 thousand 576 to the company that got the

contract. MCA Nepal had invited bids again on December 12 to construct 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.