This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS SECTION 01 OF 02 KATHMANDU 002324 
 
SIPDIS 
 
STATE FOR SA/INS AND DS/IP/NEA 
STATE ALSO PLEASE PASS USAID/DCHA/OFDA 
USAID FOR ANE/AA GORDON WEST AND JIM BEVER 
MANILA FOR USAID/DCHA/OFDA 
LONDON FOR POL/REIDEL 
TREASURY FOR GENERAL COUNSEL/DAUFHAUSER AND DAS JZARATE 
TREASURY ALSO FOR OFAC/RNEWCOMB AND TASK FORCE ON TERRORIST 
FINANCING 
JUSTICE FOR OFFICE OF THE DEPUTY ATTORNEY GENERAL/DLAUFMAN 
 
E.O 12958: N/A 
TAGS: PTER PHUM CASC PGOV IN NP
SUBJECT: NEPAL: MAOIST PROMISES GO UP IN SMOKE 
 
REF: (A) KATHMANDU 2302 
 
     (B) KATHMANDU 2316 
 
¶1. (U) Summary:  Mere days after Maoist leaders called for 
peace talks with the Government of Nepal (GON) (ref A), 
three separate incidents raised serious questions about 
whether they would honor their promises to halt attacks on 
party workers and infrastructure.  Maoists killed a Nepali 
Congress worker, vandalized the offices of an NGO, and 
attacked hydropower equipment imported by the UK. 
Systematic attacks on hydropower projects over the past year 
have left thousands of Nepali homes and industries without 
power. End summary. 
 
¶2.   A December 3 statement by Maoist leader Prachanda 
claimed that in order to facilitate talks with the GON, the 
Maoists would cease attacks on infrastructure and members of 
other political parties (ref A).  Though few analysts 
accepted the statement at face value, several political 
parties lauded it as a hopeful sign that the insurgents may 
be willing to work for peace.  Even those hopes were 
battered the next day, when Maoists launched simultaneous 
attacks on two southern police posts (ref B) and continued 
their usual pattern of violence. 
 
¶3. On Wednesday, December 4, a group of suspected Maoists 
killed a Nepali Congress worker in southern Nawalparasi 
district.  According to press reports, a group of three 
young men on bicycles shot the 60-year-old political worker 
at point-blank range.  Maoist insurgents had previously sent 
him a warning letter.  Also on Wednesday, Maoists vandalized 
the offices of Backward Society Education (BASE), an NGO 
campaigning for the liberation of bonded laborers in the mid- 
and far-western Terai regions.  According to an NGO 
spokesperson, Maoists damaged 700,000 Nrs (9000 USD) worth 
of property in the attack. 
 
¶4.  On Thursday, December 5, Maoists attacked two trucks 
carrying hydropower generation equipment imported by a UK 
development firm.  The trucks were bound for Jhankre mini 
hydropower plant and would have helped provide power to 
11,000 rural households.  The trucks and equipment, valued 
at 25 million Nrs (200,000 USD) were completely destroyed in 
the attack.  The Jhankre hydro plant had been completely 
destroyed by the Maoists on October 8, in an attack that 
also damaged a hydropower plant at Khimti.  Total damage 
from the October attack is estimated at 7-10 million USD. 
 
¶5. The Norwegian government has pledged significant 
financial support for the development and rehabilitation of 
major hydroelectric power plants, and the reaction of 
Norway's Ambassador to Nepal to the attacks was stern.  "The 
rebel attack on the trucks and the generation equipment 
makes no sense in light of Prachanda's statement that the 
Maoists would cease attacks on basic infrastructures that 
benefit the poor," she said, also lamenting the effect that 
the attack was liable to have to possible development. 
Despite previous expectations that the Khimti-I power plant 
would entice more foreign investment in the hydropower 
sector, she was clear that "Norwegian private investors will 
not be interested unless there is peace." 
 
¶6.  Systematic Maoist attacks on hydropower infrastructure 
have left thousands of rural homes without power and have 
crippled industry in towns that rely on those facilities for 
electricity.  Power to the Mid- and Far-Western regions has 
been compromised since the insurgents destroyed a 132 KV 
transmission line on the national power grid, forcing 14 
districts to resort to load-shedding during peak hours. 
Industrial towns in Kailali and Baridya have been without 
power for seven months, since the insurgents destroyed a 
power sub-station serving the western districts. 
 
¶7. Witnesses have quoted the Maoist attackers calling their 
attacks on hydropower facilities "symbolic strikes against 
the government."  Nepal Electricity Authority is not 
collecting data on the total cost of Maoist destruction, but 
recently released estimates of damage from two attacks in 
April demonstrate that the effects of the attacks are far 
from symbolic for rural families.   Damage of the 12- 
megawatt Jhimruk Power Plant in Pyuthan is estimated at 240 
million Nrs (3 million USD).   Approximately 4,000 local 
households will be without power until repair of the plant 
can be completed in an estimated 15 months.  The 5.1- 
megawatt Andhikhola Project in central Syangja suffered 18 
million Nrs (231,000 USD) worth of damage, forcing 25,000 
residents of Syangja, Palpa and Gulmi districts to live in 
the dark for one month.  Industries came to a standstill 
after the plant was destroyed, according to locals, and many 
small-scale factories were forced to lay off employees. 
 
MALINOWSKI