Millennium Challenge Account (MCA) Nepal, an entity formed to oversee the implementation of US government-funded projects worth $630 million, is

planning to request the government to include its Electricity Transmission Project in the list of national pride projects.

A board meeting of MCA Nepal held on Friday decided to request the National Planning Commission (NPC) to list the power line project being developed with a US government grant as a national pride project.

MCA Nepal was established by a Cabinet decision in April to execute projects being developed by a grant provided by Millennium Challenge Corporation (MCC), an independent US government agency.

“We will soon write to the NPC asking it to list the project as a national pride project so that it becomes one of the priority projects and gets proper attention from the government,” said a board member.

After the project is named a national pride project, it will get due attention from the government with a high-level mechanism to clear obstacles that might crop up during its implementation.

The Electricity Transmission Project being executed by MCA Nepal includes the construction of approximately 300 km of double-circuit 400 kV transmission lines in central Nepal.

There are five components in the project—one segment starting from the northeast of Kathmandu at Lapsiphedi and extending to the west of Kathmandu near Ratmate, a second segment from Ratmate to the industrial town of Hetauda located south of Kathmandu, a third segment from Ratmate to Damauli in the west, a fourth segment from Damauli to Butwal in the southwest, and a fifth segment from Butwal to the Indian border which is part of the second Nepal-India cross-border transmission line.

Three substations will also be constructed at Ratmate, Damauli and Butwal.

MCC selected Nepal for its compact programme in December 2014. Nepal was selected for the MCC programme ‘in recognition of the country’s efforts to establish rule of law and democratic institutions, and its strong performance on MCC’s policy scorecard’.

Since then, MCC has agreed to support two broad projects in Nepal—the Electricity Transmission Project and the Road Maintenance Project, as energy shortages and inferior transport network are two binding constraints for Nepal’s rapid economic growth.

Out of the total investment of $630 million, MCC will contribute $500 million while the Nepal government will put up the remaining $130 million. The bulk of the investment being made in Nepal will be spent on the development of 300 km of transmission lines and three power substations.

Another large chunk of money will be used to maintain around 300 km of roads. The rest of the money will be spent on activities like monitoring and evaluating the projects being implemented, hiring procurement and fiscal agents, and other administrative expenses.