हामी सबैकाे संसारन्यूज

The Millennium Challenge Corporation is a grant given by the United States to developing countries. For a country to be chosen, it must go through several measures to ensure that they are eligible to receive the grant. There are three types of grant that a country can get, of which Nepal has received the Compact grant. A country is a candidate of eligibility for the MCC grant primarily when there is democratic governance, investment in people and economic freedom. To read more thoroughly, you can read the steps for the selection process here: https://www.mcc.gov/who-we-fund

There are many countries that have formerly received this grant. Nepal is in the last stages of implementing this project; however, for the MCC grant to step in power, it needs parliamentary ratification. The US government states that the $500 million is a grant with no strings attached that is based on transparency and true partnership.

Nepal is categorized to be one of the least developed countries yet has internal plans to become a middle-income country by 2030. In order for this to happen, it seems obvious for the government to take the grant and use it to develop the country; however, the grant faces opposition by the Nepal Communist Party (NCP). Nepal requested a grant in 2012 where all parties were in unanimous support for the move. In 2017 Nepal was found to be eligible to receive the $500 million Compact grant, resulting in the Nepalese government accepting the agreement in order to develop its economy and reduce poverty in which the Nepalese government accepted and signed the agreement.

Within the NCP members oppose the MCC as they see it as a part of US Indo-Pacific strategy (IPS). The IPS is a fairly new term that has been coined within the last decade. The Indo-Pacific region is a geographical location which consists of countries in the Indian Ocean and the Pacific Ocean.

This dispute about MCC ignited when the Acting Deputy Assistant Secretary for South Asia at the US Department of State, David J Ranz, stated that Nepal receiving the MCC grant is one of the most important initiatives under the IPS. In the upcoming years, the Indo-Pacific region is expected to be the epicentre for economic development and geostrategic competition. Scholars see the US IPS as a means to contain China and their response to Chinas Belt and Road Initiative (BRI). However, China, a big opposition of the IPS, has stated that it welcomes any aid that will help develop Nepal economically. This is at odds with Nepal’s several communist parties, whose members believe that when the MCC gets implemented, Nepal’s relationship with China will deteriorate. China is essential in this discussion, as they share the Nepali border and have helped Nepal previously in times of need.

The basis for this discussion is due to the military component within the IPS. The NCP leaders have always been against the US and their imperialistic moves and see the MCC as a strategic entering point for the US military. The MCC, however, does not, in fact, consist of any military components, as stated by the US and in the compact agreement. There are however underlying sections that people should be aware of before they want the project to be implemented in Nepal. In the agreement, Article 7, Section 1, states that:

 The Government will proceed in a timely manner to complete all of its domestic requirements for this Compact to enter into force. The Parties understand that this Compact, upon entry into force, will prevail over the domestic laws of Nepal.

This ultimately means that the MCC law will always be superior to the Nepali law if there were to be a dispute. This contradicts with the national constitution and eliminates the sovereignty of the state.

Nepal has to find the best solution between two big rocks – the US and China. The MCC is a part of broader US foreign policy and the IPS. Nepal, however, cannot afford to lose their relationship with China as it is more vital than the grant received from the US. Is the MCC really worth Nepal’s sovereignty over $500 million? If Nepal built a system where businesses paid taxes properly and tax evasion was not possible, $500 million would be generated in no time. If the country could collect the money nationally, then it would not be in need of being dependent on foreign aid. How long should Nepal be in the shackles by the imperialistic global superpowers and their foreign policies?