June 18: Preparations are underway for the full implementation of the projects under the US-funded Millennium Challenge Corporation (MCC) from mid-August this year. The Millennium Challenge Account Nepal (MCA Nepal), which has been entrusted with the responsibility to implement the projects, has expedited the work from acquiring land to selecting companies to participate in the construction works under the MCC.

Khadga Bahadur Bista, executive director of MCA Nepal, said that they are actively involved in advancing the construction works under the project from the mid-August. According to him, MCA Nepal is about to complete the contract process for starting the projects. Executive Director Bista informed that although other preparatory works have been completed, the land acquisition and compensation has not been finalized.

According to him, notices have been published in nine districts for land acquisition. Meanwhile, there is an ongoing dispute between the Nepal Electricity Authority and the locals of Lapsifedi. Bista said that they are making efforts to resolve the dispute and carry out the work related to the project.

The transmission line under the MCC will spread across 10 districts namely Kathmandu, Sindhupalchok, Nuwakot, Dhading, Makwanpur, Chitwan, Tanahun, Palpa, Nawalpur and Parasi. In some of these districts, after completing the compensation work, it is ready to go into full implementation. The process of land acquisition in nine districts except Kathmandu has already progressed.

Bista said that a committee will be formed to fix the criteria for determining compensation of land after they receive copies of land ownership certificate from the land owners who will be displaced due to the project.

He said that the MCC project will be implemented as soon as possible after determining the price of the land.

According to MCA Nepal, selection of the company to build the transmission line under MCC is also underway.

Six proposals have been received for the construction of transmission lines. In the globally announced tender bids, MCC received applications from Mega Engineering and Infrastructure Limited and Power Mech Projects Limited, a joint venture of Kalpataru Power Transmission Limited, KEC International Limited, Transrail Lighting Limited, Tata Projects Limited and Larson and Turbay Limited.

Officials of MCA Nepal say that it will take 90 days to study the proposals. The company will be selected after completing the study.

About Rs 5.5 billion have already been spent on the project with a grant of USD 500 million from the American government and USD 130 million from Nepal (Rs 82.5 billion according to the current exchange rate).

The expenditure on the project so far is more under the heading of current expenses than on the capital expenditure. The government has allocated Rs 10.84 billion for MCA Nepal in the upcoming fiscal year’s budget. The government will contribute Rs 2.21 billion while the MCC will fund Rs 8.63 billion for the next fiscal year.

During this period, Rs 1.17 billion will be spent as current expenditure while Rs 5.36 billion has been earmarked for building transmission lines and substations and Rs 1.4 billion for road construction. Similarly, Rs 1.28 billion has been set aside for consultation.

Under the MCC project, a cross-border electricity transmission line will create from Nepal to India. The infrastructure will facilitate the transmission of electricity from Butwal to Gorakhpur, India, which will be jointly invested by Nepal and India.

Three new substations of 400 KV capacity will be constructed under the 315 km long double circuit 400 KV transmission line.

Some critics suspect that the project will be completed within the timeframe of five years, saying that the preparatory works of the project have not progressed as expected.