Contract of 400-KV transmission line under MCC scrapped, creating uncertainty

The cancellation of a contract process for 400 KV transmission line to be constructed under the MCC grant has created uncertainty how and when the construction initiates.

Issuing a notice on October 13, the Millennium Challenge Account Nepal Development Committee (MCA-Nepal) had scrapped all contract processes relating to the construction of the transmission line. The contract called for the construction of a transmission line that included the areas Lapsephedi-Ratmate-New Hetauda (first lot), Ratmate-New Damauli (second lot), New Butwal-Nepal/India border area (third lot).

The MCA-Nepal has informed that the contract process was scrapped due to the higher cost proposed for construction than initial estimated cost. It has resulted into the uncertainty how and when the 400-KV transmission line of a total 315 km would advance.

What are the legal bases to take ahead the contract and when the re-tendering would be made are not scheduled.

Responding to these queries, MCA-Nepal informed that a plan was already in place on how they could move ahead after the cancel cancellation of contract of the mega project. "With the feedback from market, MCA-Nepal had been collaborating with the MCA for the successful procurement. With the coordination among technological experts, MCC and Nepal government, it will be carried out in an efficient and timely manner. MCA-Nepal is committed to ensure construction of this mega project in line with environmental and social standard of MCA-Nepal and MCC."

Although the MCA-Nepal claims timely construction of the project, the hassles on contract process have created uncertainty over it. The contract which is scrapped now was called on November 28, 2022.

It took nearly a year to evaluate the proposal. It is not sure when the next tender will be announced. It is however claimed that the project will complete in five years.

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