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🇳🇵 Nepal /Economy & Trade

Finance Ministry delays forwarding MCA Nepal’s request to extend MCC projects

From Kathmandu Post · () English

Summarized and contextualized by DistantNews.

At a glance

News Named sources Ongoing story
  • The Finance Ministry has delayed forwarding a request from the Millennium Challenge Account Nepal (MCA-Nepal) for a one-year extension on US-funded infrastructure projects.
  • MCA-Nepal seeks the extension due to implementation delays caused by the US government's temporary suspension of operations and contract re-tendering.
  • The ministry's delay means the request has not yet reached the Millennium Challenge Corporation (MCC) headquarters for review and approval.

The Millennium Challenge Account Nepal (MCA-Nepal) faces a hurdle in its US-funded infrastructure projects as the Finance Ministry has not yet forwarded a request for a one-year extension. The proposal, sent in mid-May, seeks to push back the completion deadline for a $747 million package including a 315-km transmission line and road upgrades.

It is still under discussion.

— Senior finance ministry officialThe official explained the status of MCA-Nepal's request for a project extension.

MCA-Nepal attributes the need for an extension to a 14-month delay stemming from the US government's temporary suspension of MCC operations and the cancellation and re-tendering of contracts for the transmission line. Bidders quoted prices significantly above the estimated cost in October 2023, necessitating a restart of the bidding process which took nine months to award a new contract.

Due to some reasons, we have already sought a one-year term extension for the completion of the two projects.

— Senior MCA-Nepal board memberThe board member explained the need for an extension due to implementation delays.

A senior finance ministry official stated the request is "still under discussion" but did not specify the reasons for the delay. The finance secretary heads the MCA-Nepal board, highlighting the internal connection. Despite the hold-up, MCA-Nepal believes MCC headquarters is positive about the extension, citing valid reasons and a new US law that could facilitate it.

It has been three months since MCA-Nepal sent such a request to the finance ministry, but there is no information about the term extension.

— Senior MCA-Nepal board memberThe board member expressed concern over the delay in processing the extension request.
DistantNews Editorial

Originally published by Kathmandu Post. Summarized and contextualized by our editorial team with added local perspective. Read our editorial standards.

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