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

UNCLAS SECTION 01 OF 03 KATHMANDU 000858 
 
SIPDIS 
 
STATE FOR SA/INS AND DS/IP/NEA 
STATE ALSO PLEASE PASS USAID/DCHA/OFDA 
STATE ALSO PLEASE PASS PEACE CORPS HQ 
USAID FOR ANE/AA GORDON WEST AND JIM BEVER 
MANILA FOR USAID/DCHA/OFDA 
LONDON FOR POL/RIEDEL 
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: PINS PTER CASC PGOV NP
SUBJECT: UPDATE ON NEPAL'S MAOIST INSURGENCY, May 3-9 
 
SUMMARY 
------- 
 
¶1.  The second round of peace talks between negotiators for 
the Government of Nepal (GON) and Maoists is being held on 
May 9.  Envoys from China and the United Kingdom expressed 
support and assistance for the peace process.  Maoist 
leaders have sharply criticized USG for listing their party 
on a terrorist watch list.  The Royal Nepal Army (RNA) 
warned the Maoists that they would face severe consequences 
if they withdraw from the peace talks.  The Home Ministry 
reportedly has taken steps to withdraw cases against Maoist 
detainees.  Maoist insurgents continued to violate the 
ceasefire by abducting five civilians, severely beating two 
others, attempting to extort money, and disrupting 
humanitarian assistance programs.  The All Nepal National 
Independent Students' Union-Revolutionary (ANNISU-R) has 
threatened action against private schools that do not reduce 
tuition fees.  End summary. 
 
SECOND ROUND OF TALKS SCHEDULED 
------------------------------- 
 
¶2.  Negotiators representing the GON and the Maoists meet on 
May 9 for the second round of peace talks.  Krishna Bahadur 
Mahara, Maoist spokesman and team member, said the Maoists 
do not have a new agenda, but are hopeful that the GON will 
respond to the demands put forth in the first round of 
talks.  These demands include a round-table conference, 
Maoist leadership in a new interim government, constituent 
assembly, withdrawal of cases against Maoist cadres, and 
demobilization of armed forces.  Narayan Singh Pun, Minister 
of Physical Planning and Works and government negotiator, 
told reporters on May 6 that details of the GON's agenda 
would emerge on the day of the talks. 
 
SUPPORT FOR PEACE TALKS 
----------------------- 
 
¶3.  Keith Bloomfield, Ambassador of the United Kingdom (UK) 
to Nepal, said the UK is ready to facilitate peace talks and 
assist in maintaining security in Nepal.  Speaking at a 
program on May 6, Bloomfield said the UK favored a 
constitutional monarchy and respect for human rights. 
 
¶4.  Wu Congyong, the Chinese Ambassador to Nepal, also 
voiced support for the peace talks at a May 8 interaction on 
China's foreign policy.  Congyong said that China would not 
interfere with Nepal's "internal affairs," and said he was 
confident in the ability of the Nepali people to solve the 
current crisis.  Congyong said maintaining peace and 
stability would be beneficial to Nepal's economy and 
development. 
 
MAOIST LEADERS BLAST U.S. FOR TERRORIST LABEL 
--------------------------------------------- 
 
¶5.  Maoist leaders have condemned the listing of their party 
on a terrorist watch list in the annual "Patterns of Global 
Terrorism" report, released on April 30 by the Secretary of 
State and the Coordinator for Counter-Terrorism.   In a 
press release issued on May 7 Prachanda, Maoist supreme 
leader, said the U.S. was trying to disrupt the peace talks 
and interfering with Nepal's internal affairs.  He said the 
U.S. was attempting to hatch a conspiracy against the talks, 
and lashed out at the "repeated verbal attacks" on the 
Maoists by the U.S. Ambassador to Nepal.  The Maoist 
Chairman also accused the U.S. of trying to further its own 
interests in Nepal in order to extend its influence over all 
of South Asia. 
 
¶6.  Baburam Bhattarai, chief negotiator of the Maoist 
negotiating team, also criticized the Maoists' placement on 
the terrorist watch list.  On May 7 Bhattarai reportedly 
said the action would have serious and far-reaching effects 
on Nepal.  He surmised that the peace talks were being 
"hijacked by foreign capitals," and warned that such actions 
would turn Nepal into a battlefield.  In a separate 
interview on May 8 with a vernacular newspaper, Bhattarai 
continued his attacks on the U.S., saying America was "a 
dangerous force and hurdle in the talks."  The Maoist 
ideologue, echoing Prachanda, also accused the U.S. 
Ambassador to Nepal of making threats against Nepal. 
Krishna Bahadur Mahara, Maoist spokesman and talk team 
member, urged the U.S. to revoke the decision. 
 
¶7.  Keith Bloomfield, Ambassador of the United Kingdom (UK) 
to Nepal, told the local press that his government has not 
labeled the Maoists as terrorists because their activities 
do not substantially threaten the UK.  (Note:  It is 
interesting to note that Prachanda's brother reportedly is 
studying at the University of Riding in London). 
 
RNA WARNS MAOISTS 
----------------- 
 
¶8.  The Royal Nepal Army (RNA) reportedly warned the Maoists 
on May 6 that they would pay "a big price" if they withdrew 
from peace talks.  A vernacular publication said the RNA 
claimed that it is now equipped with better, more modern 
weapons, and had received additional training.  Bhattarai 
dismissed the boasts and said any weapons the RNA obtained 
from the U.S. would soon be stolen by the Maoists. 
 
¶9.  Madhav Nepal, General Secretary of the Communist Party 
of Nepal-United Marxist Leninist (CPN-UML) accused both the 
GON and the Maoists of storing weapons and preparing for 
war.  Nepal, addressing a CPN-UML convention on May 6, said 
both sides were trying to amass military strength while his 
party was cooperating with the peace process.  CPN-UML is 
one of five political parties which launched a "peoples' 
movement" against the King, and which Nepal claims is aimed 
at strengthening the peace process. 
 
WITHDRAWAL OF MAOIST CASES POSSIBLE 
----------------------------------- 
 
¶10.  A vernacular publication quoted an anonymous source at 
the Home Ministry as saying that efforts were being made to 
withdraw cases against Maoist cadres.  According to the 
source, all District Administration Offices (DAO) have been 
instructed to supply data relating to Maoist detainees. 
After all of the data is received, the cases will be 
reviewed for possible withdrawal of charges.  Mahara 
criticized the GON for delaying the release of Maoist 
cadres, and said he would take the matter up again at 
Friday's round of peace talks.  The official at the Home 
Ministry cautioned that even if the recommendations are made 
to withdraw the cases, it is up to the individual courts to 
follow through. 
 
¶11.  Thirteen Maoist cadres were released this week from 
jails in the districts of Terhathum, Makwanpur, Taplejung 
and Lamjung. 
 
MAOIST CRIMES CONTINUE 
---------------------- 
 
¶12.  Maoist insurgents continued to violate the ceasefire, 
abducting two Village Development Committee (VDC) members in 
the districts of Dailekh and Makwanpur.  Three journalists, 
including two women, were also abducted in the far western 
district of Kalikot on May 7.  The journalists, who were on 
a reporting assignment, managed to escape.  Insurgents in 
the eastern Terai district of Rauthat severely beat two 
civilians who could not provide monetary donations to the 
Maoists, and also beat three people, including a Communist 
Party of Nepal-United Marxist Leninist (CPN-UML) worker, 
after they protested the destruction of a house by the 
insurgents.  Five civilians who reportedly were abducted 
from Taplejung District several weeks ago have allegedly 
been severely bludgeoned by their Maoist captors.  Relatives 
are pleading for their release.  Family members of a former 
VDC Chief abducted a week ago are also appealing to the 
Maoists for his release, and have sought help from local 
human rights organizations. 
 
¶13.  Maoists in the mid-western hill district of Dailekh 
have forced local villagers to abandon traditional festivals 
and celebrations, including song and dance, and ordered them 
to mark the February 13 launch date of the "People's War." 
The insurgents, who control the majority of the district, 
have forced villagers to observe Maoist festivals and 
abandon other practices.  The Maoists said the new culture 
eliminates the practice of "untouchability." 
 
¶14.  The Maoist insurgency has forced the Rautes, an 
indigenous ethnic community in the far-western district of 
Dadeldhura, to flee to the jungle.  The families claim that 
Maoists tortured them in the day while security forces 
harassed them at night.  They remain in the jungle, doubtful 
of the success of the peace talks. 
 
¶15.  Villagers in the mid-western Rolpa District, however, 
have defied the Maoists in order to attend Government- 
sponsored health camps.  Insurgents in the district had 
ordered the locals not to attend the camps, and asked the 
team of medics, consisting of army and police personnel, to 
leave, accusing them of violating the ceasefire.  The 
insurgents, who have a stronghold on the region, said they 
wanted the areas to remain "enemy free."  Maoist cadres also 
tried to disrupt similar health camps in Salyan and Dang 
Districts by limiting water supplies to the medics, and 
attempting to stop people from seeking treatment. 
 
ANNISU-R THREATENS SCHOOLS 
-------------------------- 
 
¶16.  The All Nepal National Independent Students' Union- 
Revolutionary (ANNISU-R), the Maoist affiliated student 
group, has threatened protests against private schools that 
do not reduce their tuition rates.  Kabi Gautam, Secretary 
of ANNISU-R, said that the action is being taken at the 
request of parents, and because the private schools are 
cheating students and parents.  Lhundub Dorji Lama, 
President of National Private and Boarding Schools 
Association Nepal (PABSON), warned that the schools would 
defy the protests, declaring that it was impossible to 
conduct classes with the constant interference by student 
organizations. 
 
MALINOWSKI