Banking News – The U.S. government under President Donald Trump has suspended funding for the Millennium Challenge Corporation (MCC) project in Nepal, putting the entire initiative on indefinite hold. As a result, construction work that had yet to begin has now been stalled indefinitely.

Previously, President Trump had also frozen USAID funding for Nepal and other countries worldwide. Following this decision, thousands of USAID employees were placed on leave, and U.S. funding for Nepal’s federalization efforts was also suspended. Now, under the latest directive, the MCC budget has been entirely halted.

According to Nepal’s Ministry of Finance, payments for MCC projects have been stopped under the agreement signed between the Nepal government and MCC on September 14, 2017. The move has further deepened uncertainty around the controversial MCC project, which has faced significant political and public debate in Nepal.