Prime Minister Sher Bahadur Deuba and chairs of the CPN-UML and Communist Party of Nepal (Maoist Centre) KP Sharma Oli and Pushpa Kamal Dahal are holding a meeting at Baluwatar.

The meeting between the three leaders comes on the heels of a letter from the Millenium Challenge Corporation (MCC), setting the February 28 deadline for Nepal to ratify the MCC-Nepal Compact from the Parliament.

The MCC headquarters in its response to a letter sent by Deuba and Dahal on September 29 last year has said that without action on the part of Nepal 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.”

This is the first time Oli has reached Baluwatar since he was ousted from office on July 13.

“Prime Minister Deuba is holding discussions with the Dahal and Oli,” said Ramesh Malla, chief personal secretary of Dahal, without providing details. “UML General Secretary Shankar Pokhrel is also present.”

Secretariats of all the leaders have maintained silence on the agenda, but there are speculations if they are discussing the deadline set by MCC for the compact ratification.

The MCC compact has become such a politically divisive issue in Nepal that it has emerged as a threat to the current coalition.

Though Deuba is keen on endorsing the compact, Dahal has opposed it, saying it cannot be ratified without amendments to some of its provisions. CPN (Unified Socialist), another coalition partner in the Deuba government, is also against the MCC ratification.

Under pressure, Deuba was in a bid to seek support from the UML for the compact ratification.

Deuba had visited Oli’s residence at Balkot on January 8 to ask him to end the House obstructions by the main opposition and help ratify the MCC compact.

The Prime Minister’s Secretariat, however, said that Sunday’s meeting between top leaders was aimed at discussing local polls. The government and the Election Commission on Tuesday reached a tentative agreement to conduct local level elections on May 18. The government has not announced the date yet.

A member from the Private Secretariat said that the government is trying to forge consensus among parties to ratify the MCC compact from Parliament.

Bhanu Deuba, chief personal secretary of the prime minister, said the three top leaders wanted to discuss local polls. “But other contemporary issues will also be discussed,” he told the Post.

A Maoist Centre leader said that the party won’t extend support to ratify the MCC compact in its present form, as it has made its position already clear. Leaders close to Dahal have been trying to defend the letter sent to MCC, saying it was a request to delay the ratification rather than an assurance.

“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.”