The ruling coalition is in trouble.

With Communist Party of Nepal (Maoist Centre) chair Pushpa Kamal Dahal coming under pressure following the leak of two letters regarding the Millennium Challenge Corporation-Nepal Compact, which put him in a false position, he appears to be ready to break the coalition.

A leader close to Dahal said that if the prime minister is so bent on ratifying the compact from Parliament, he can take the support of the main opposition CPN-UML.

“Our chairman spoke with the prime minister this morning and asked him to ratify the compact with the help of the main opposition CPN-UML,” said a Central Committee member of the Maoist Centre. “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.”

On Sunday evening, Prime Minister Deuba, Maoist Centre Dahal and UML chair KP Sharma Oli held a meeting at Baluwatar, in a first such meeting between the three leaders since the coalition government was formed some seven months ago.

This was also the first time Oli went to Baluwatar since leaving the prime ministerial residence after he was ousted from office on July 13.

Secretariats of all three leaders were tight-lipped about the agenda of the discussion. However, speculations were rife that the discussion revolved around the MCC compact.

On Sunday, two letters made it to the public domain—one written by Deuba and Dahal to MCC seeking some time for the compact ratification and the other by MCC headquarters to the two leaders setting a February 28 deadline.

As Deuba was preparing to table the compact in the House for its ratification, Dahal was vehemently opposing such a move. The CPN (Unified Socialist) then joined the chorus, saying the MCC compact, under which Nepal will receive $500 million in grants from the United States, cannot be passed from Parliament in “its existing form”.

Though Deuba had on November 4 said that he and Dahal had written to MCC assuring the passage of the compact, the Maoist chair had denied the claim. Dahal had said the letter was a request to seek time for consensus but not an assurance.

The MCC headquarters, however, has now made it clear that the leaders duo had sought four-five months and that the five-month period is going to end on February 28.

During the meeting, Oli reiterated his stance that if the ruling coalition wants the main opposition’s support, they must meet its demands.

“We have told the coalition partners that if they want our support, they should create an environment for us to take part in parliament meetings,” Shankar Pokhrel, UML general secretary who was present at the meeting, told reporters after the meeting. “The prime minister is for endorsing the MCC compact but Dahal proposed delaying its ratification until upcoming polls.”

It is actually the UML that has been obstructing the House proceedings. The main opposition’s gripe is not about the government but Speaker Agni Sapkota. The UML has accused Sapkota of failing to act on its decision to expel its lawmakers. The same “expelled” lawmakers later had split from the UML to form a new party—CPN (Unified Socialist) led by Madhav Nepal.

Nepal, however, was absent at Sunday’s Baluwatar meeting.

Some said Nepal was not invited and others said Oli would not have participated in the meeting if his bete noire was also present at Baluwatar.

A CPN (Unified Socialist) leader admitted that the coalition may break apart over the American grant.

“Prime Minister Deuba is bent on endorsing the MCC compact and is preparing to table it in Parliament at the earliest,” said Jagannath Khatiwada, spokesperson for the CPN (Unified Socialist). “Tabling the MCC compact means endorsing it, and we are not going to support it. Nor will the Maoist Centre. Moving the MCC compact forward for its ratification will mean the breakdown of the current coalition.”

Oli has been saying that his party could support the prime minister in passing the MCC compact if he dared to break the current coalition.

Khatiwada said the parties could also delay the MCC ratification until the upcoming polls if the US does not withdraw it by the set deadline of February 28.

“But what is clear is our philosophy does not match with that of Deuba, as he clearly seems to be aligned to the American line,” said Khatiwada. “Even if the coalition falls apart, four parties will maintain unity and the Congress will be out.”

The Maoist Centre, the CPN (Unified Socialist), the Janata Samajbadi Party and the Rastriya Janamoracha are Deuba’s current coalition partners.

That Prime Minister Deuba is keen on ratifying the compact is also apparent from his actions. Only on Sunday, he sent Minister for Law, Justice and Parliamentary Affairs Dilendra Badu to meet with Speaker Sapkota.

Sapkota, a long-time Dahal ally, has been in consultations for quite a while ever since Deuba started preparations for tabling the MCC compact for ratification. Sapkota’s increased consultations, however, have met with criticism, with some saying his moves are unwarranted.

Minister for Communication and Information Technology Gyanendra Bahadur Karki, a key interlocutor of Deuba, said that Sunday’s meeting was simply aimed at breaking the ice.

Karki in the past has worked as Deuba’s emissary to hold talks with Oli on different issues, including for breaking the House deadlock and passing the MCC compact.

“Actually today’s meeting was meant to break the ice. The three top leaders had a hearty discussion for around two hours on various issues, including MCC and local polls,” Karki told the Post. “Now the government will work to endorse the MCC compact after forging consensus among all parties through such regular meetings.”

He refused to elaborate how consensus on MCC could be reached among parties.

Karki, who is also the government spokesperson, himself has a lot of stake in the MCC compact, as he was the one who put his signature in the agreement in September 2017 in the capacity of finance minister. Deuba was prime minister then backed by Dahal.

Nepali Congress leaders say there is no turning back on MCC and that it must be ratified even at the cost of the coalition. According to them, the compact will be tabled at the upcoming meeting of Parliament.

“Once the MCC is tabled, all the illusions created by some parties will be clear,” said Min Bishwakarma, a Nepali Congress leader close to Deuba. “Regardless of whether the compact gets through Parliament or not, those coalition partners who are opposing it will leave the government once it is tabled in Parliament.”