It was signed in 2017 and ratified by Nepal last year.
Former World Bank economist Prem Sangraula said it is just one of the programmes the US is conducting in Nepal, and has drawn criticism from China who accused the US of “coercive diplomacy”.
The MCC initially faced opposition from current Prime Minister Dahal, who was back then the Chair of the Communist Party of Nepal-Maoist Center, though he later voted for its ratification.
While Washington hopes to compete with Beijing in the region by growing its ties with the Indo-Pacific, Asian countries do not want to be forced to choose sides.
Mr Harry Bhandari, state delegate of Maryland since 2018, was the first lawmaker of Nepali origin to be elected in the US.
“The relationship between Nepal and United States is based on peace, economic prosperity and human rights,” he said, adding that there are benefits to greater alignment with the US.
Much of the Nepalese diaspora in the US still feel a strong connection to their roots, and hope to strengthen those ties by improving health and education opportunities in Nepal, away from the complexities of geopolitics.