It has become apparent that Communist Party of Nepal (Maoist Centre) chair Pushpa Kamal Dahal had lied about the letter to the Millenium Challenge Corporation.

A day after Fatema Z Sumar, vice president at MCC Compact Operations, told the Post and its sister paper Kantipur that Prime Minister Shera Bahadur Deuba and Maoist Centre Dahal had sent a letter to MCC seeking four-five months, the letter made it to the public domain on Sunday.

According to the letter, signed by Deuba and Dahal, a copy of which the Post also has obtained, the two leaders requested additional time for the ratification of the MCC-Nepal Compact.

Deuba and Dahal have in the letter also said that they would discuss the clarifications received from MCC with all the coalition partners to better inform their party members; use government of Nepal resources to communicate publicly with the Nepali people and state the government’s support for implementing the compact and to dispel misunderstandings and apprehensions about the compact; hold a joint press conference with leaders of the coalition partners to demonstrate government’s positive views on the MCC ratification and disseminate accurate information about the Compact through state media.

They have also expressed commitment to encourage the MCA-Nepal to complete technical and communication activities that will allow the compact to be implemented more quickly, and jointly request the Speaker of the House of Representatives to plan for tabling of the compact for the ratification as soon as possible.

Upon his arrival in Kathmandu from Glasgow after attending the climate conference on November 4 last year, Deuba told the media that he and Dahal had sent a joint letter to MCC assuring its earliest ratification.

Dahal, however, had denied sending any letter to MCC with the assurance of the compact ratification.

Stating that “we, the leaders of the coalition partners of the present government of Nepal, jointly make a request to the MCC Board for providing additional time for the ratification of the compact, Deuba and Dahal wrote: “We want to assure you of the government of Nepal’s intent in securing the MCC grant and implementing it for the economic development of Nepal.”

“Detailed discussions were held and we conveyed our commitment to ratification during the recent visit of Fatema Z Sumar, vice president, Compact Operations,” the two leaders wrote to MCC. “The newly formed coalition government is making all efforts possible towards this end.”

As told by Sumar in an interview with the Post, the two leaders had also requested for the duration of some four-five months time to garner a majority in the Parliament necessary for the ratification of the compact.

Dahal’s denial that such a letter was sent had created confusion in Nepal. He repeatedly made statements that the US grant cannot be endorsed in its existing form. In his political paper presented during his party’s general convention held from December 26 to January 2, about three months after the letter was sent to MCC, Dahal wrote that the Maoist Centre was against the parliamentary ratification of the $500 million grant from the US without amendments.

Sumar told the Post on Friday that the five-month time sought by Deuba and Dahal ends on February 28.

A response letter sent by MCC to Deuba and Dahal says: “Without action on your part by February 28, 2022, the MCC Board will discuss next steps at its March 2022 meeting, including whether to continue with the compact.”

“Absent ratification, it is within the MCC Board’s authority to discontinue Nepal’s eligibility to receive the $500 million compact grant from the United States,” reads the letter undersigned by Mahmoud Bah, acting chief executive officer of MCC.

“Such a decision would end MCC’s partnership with Nepal.”

Bah in his letter to the Nepali leaders has also reminded them of their commitments to ratify the compact.

“The MCC Board noted your commitment in the September 21 letter to work to ratify the compact in four-five months from the date of the letter. The Board also acknowledged your plan to increase public awareness of the compact and actively combat disinformation about the compact,” reads the letter by Bah. “MCC requests that you continue to work with parliamentarians and coalition partners to ratify the compact by the timeline indicated in your letter, no later than February 28, 2022.”

The response from MCC is a clear indication that it is not in a mood to entertain any deadline extension request from Nepal, as the compact has been in limbo for more than four years since it was signed in September 2017.

With the letter by Deuba and Dahal to MCC becoming public, leaders close to the Maoist Centre chair are defending it as a bid to delay its ratification rather than an assurance to ratify it. MCC’ compact’s parliamentary ratification had become a divisive political issue, threatening even the current coalition.

The revelation that Dahal indeed had signed the letter assuring the compact’s ratification and MCC’s terse response that it cannot wait beyond February 28 could now break the current coalition.

“The prime minister, who appeared ready to wait until local polls, started building pressure for tabling MCC from Saturday again. It seems he was under pressure from the Americans,” said a Central Committee member of the Maoist Centre. “Dahal has already spoken with the prime minister and asked him to ratify the compact with the help of the main opposition CPN-UML.”

As the Maoist Centre continued to resist Deuba’s requests to endorse the MCC compact, the prime minister had established talks with UML chair KP Sharma Oli to seek support.

A leader close to Dahal said there could be a meeting of three leaders–Deuba, Dahal and Oli by this evening.

“Dahal is likely to ask Deuba and Oli to endorse the MCC compact as Maoist Centre cannot accept it without amendments,” said the Maoist leader asking not to be named. “If Deuba creates pressure on our party, we will pull out of the coalition.”

CPN (Unified Socialist) chair Madhav Kumar Nepal, who is also against the ratification of the MCC in its current form, said that he has also asked the prime minister to talk to the leader of the main opposition if he wished so.

“Let’s see how things evolve. It will be too early to speak on a matter about which no one is clear,” Nepal told the Post.

Meanwhile, Prime Minister Deuba and UML chair Oli are set to hold a meeting later on Sunday.

“Chairman Oli is holding a meeting with Prime Minister Deuba at 4 pm at Baluwatar,” said Ram Sharan Bajagain, an aide of Oli.