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

C O N F I D E N T I A L SECTION 01 OF 03 KATHMANDU 001001 
 
SIPDIS 
 
E.O. 12958: DECL: 05/28/2014 
TAGS: NP PGOV PREL GON
SUBJECT: NEPAL: KING'S ADVISOR OUTLINES STEPS TO FORM NEW 
GOVERNMENT 
 
Classified By: DCM ROBERT K. BOGGS FOR REASONS 1.5 (B,D) 
 
¶1. SUMMARY: KING GYANENDRA'S BUSINESS PARTNER AND CONFIDANT, 
PRABHAKAR RANA, TOLD THE CHARGE AND DCM ON MAY 28 THAT 
REPEATED EFFORTS TO PERSUADE THE LEADERS OF THE TWO MAIN 
POLITICAL PARTIES TO ACCEPT SOMEONE ELSE AS PRIME MINISTER 
HAD FAILED.  AS A RESULT, THE KING IS LIKELY TO CALL ALL THE 
PARTIES TOGETHER AGAIN SOON (PERHAPS AS EARLY AS MAY 31) TO 
PRESENT THEM WITH AN ULTIMATUM--EITHER COME TO HIM SOON WITH 
THE NAME OF AN AGREED CANDIDATE FOR PRIME MINISTER OR THE 
KING WILL APPOINT A PRIME MINISTER OF HIS OWN CHOOSING. 
CURRENTLY, THE KING'S LEADING CANDIDATE FOR PM IS 
PARLIAMENTARY SPEAKER TARANATH RANABHAT.  ALTHOUGH THERE ARE 
A NUMBER OF GOOD REASONS WHY RANABHAT SHOULD BE ACCEPTABLE TO 
A NUMBER OF PARTIES, EMBASSY IS NOT CONFIDENT THAT THE 
LEADERS OF THE MAJOR PARTIES WILL ACCEPT HIS APPOINTMENT.  IF 
THE PARTIES CANNOT REACH AGREEMENT SOON ON A COMMON CANDIDATE 
AND REJECT THE KING'S CHOICE, PROSPECTS FOR FORMING A 
BROADER-BASED NEW GOVERNMENT AND ENDING POLITICAL PARTY 
AGITATIONS REMAIN DIM. END SUMMARY. 
 
¶2. (C) PRABHAKAR RANA, BUSINESS PARTNER AND CONFIDANT OF KING 
GYANENDRA, VISITED EMBASSY ON MAY 28 TO BRIEF CHARGE AND DCM, 
WITH THE KING'S AUTHORIZATION, ON RECENT STEPS BY THE PALACE 
TO FORCE A CONSENSUS AMONG NEPAL'S AGITATING PARTIES ON A 
NEW, MULTI-PARTY GOVERNMENT.  RANA EXPLAINED THAT HE HAD BEEN 
CHARGED BY THE KING WITH ATTEMPTING TO ESTABLISH A "STRATEGIC 
ALLIANCE" WITH GIRIJA PRASAD KOIRALA, OCTOGENARIAN LEADER OF 
THE MAIN FACTION OF THE NEPALI CONGRESS PARTY.  THE RATIONALE 
FOR SUCH AN ALLIANCE WAS THAT KOIRALA, BY VIRTUE OF HIS AGE 
AND EXPERIENCE, COULD BEST SERVE AS LEADER OF THE LIBERAL 
DEMOCRATIC PARTIES AS THE KINGDOM MOVES TOWARD PARLIAMENTARY 
ELECTIONS IN THE COMING YEAR UNDER A NEW GOVERNMENT.  SUCH AN 
ALLIANCE IS IMPORTANT, RANA EXPLAINED, BECAUSE THE LIBERAL 
DEMOCRATIC PARTIES WERE SO DIVIDED THAT NONE OF THEM WAS 
LIKELY TO WIN CONTROL OF AN ELECTED PARLIAMENT, MAKING IT 
NEARLY CERTAIN THAT THE BETTER ORGANIZED COMMUNIST PARTIES 
WOULD DO SO.  MOST OF THE LIBERAL DEMOCRATIC PARTIES, 
INCLUDING THE NEPARI CONGRESS, HAVE SPLIT, AND THE 
CONSERVATIVE RPP SHOWS SIGNS AGAIN OF SPLITTING AS WELL. 
 
¶3. (C) AS EXPECTED, RANA SAID, KOIRALA HAD PROVEN TO BE A 
DIFFICULT, STUBBORN MAN DURING THE NINE PRIVATE CONVERSATIONS 
THE TWO HAD HELD.  IT WAS CLEAR, RANA SAID, THAT THE ELDER 
POLITICIAN COULD NOT ACCEPT ANYONE OTHER THAN HIMSELF TO BE 
APPOINTED AS PRIME MINISTER IN A NEW GOVERNMENT.  RANA SAID 
HE HAD TRIED TO REASON WITH KOIRALA, PROPOSING A NUMBER OF 
NAMES OF POLITICAL LEADERS WITHIN KOIRALA'S OWN PARTY WHO 
MIGHT BE ACCEPTABLE TO HIM.  DESPITE THIS, HOWEVER, KOIRALA 
HAD REJECTED EVERY NAME, ARGUING THAT ANY PRIME MINISTER FROM 
HIS PARTY OTHER THAN HIMSELF WOULD ONLY DIVIDE HIS PARTY 
FURTHER.  FINALLY, DURING THEIR LAST MEETING THIS WEEK, RANA 
HAD MADE IT UNMISTAKABLY CLEAR THAT KOIRALA WOULD NOT BE 
ACCEPTABLE AS PRIME MINISTER EITHER TO THE KING OR TO THE 
NEPALI PEOPLE.  THE EFFECT OF THIS MESSAGE, RANA SAID, HAD 
BEEN CRUSHING, MAKING KOIRALA LOOK UNCHARACTERISTICALLY FULLY 
AS OLD AS HIS 81 YEARS.  IN MORE RECENT COMMUNICATIONS 
KOIRALA HAS APPEARED TO SOFTEN SOMEWHAT, SAYING HE WOULD 
ACCEPT PUSHUPATI RANA, THE PRESIDENT OF ONE FACTION OF THE 
RPP, AS PRIME MINISTER, BUT HAS REMAINED ADAMANT THAT HE WILL 
ACCEPT NO ONE FROM THE NEPALI CONGRESS. PRABHAKAR RANA OPINED 
THAT, BASED ON PAST PERFORMANCE, KOIRALA IN FACT PROBABLY 
WOULD NOT ACCEPT EVEN PASHUPATI RANA AS PM.  KOIRALA HAD SAID 
HE WOULD WANT TO PHASE OUT STREET DEMONSTRATIONS GRADUALLY 
OVER A TWO-MONTH PERIOD AFTER A NEW GOVERNMENT WAS APPOINTED, 
BUT PROBABLY WOULD USE THEM INSTEAD TO OPPOSE ANY GOVERNMENT 
THAT HE DID NOT HEAD. 
 
¶4. (C) RANA WENT ON TO EXPLAIN THAT THE KING HAS TOLD SHER 
BAHADUR DEUBA, THE LAST ELECTED PRIME MINISTER AND LEADER OF 
THE BREAKAWAY FACTION OF THE NEPALI CONGRESS, THAT HE WOULD 
BE ACCEPTABLE AS PRIME MINISTER IF HE COULD OBTAIN THE 
SUPPORT OF OTHER PARTIES.  DEUBA, HOWEVER, HAS FAILED TO 
OBTAIN THE SUPPORT OF THE IMPORTANT COMMUNIST PARTY OF 
NEPAL-UNITED MARXIST-LENINIST (CPN-UML) AND WOULD NEVER BE 
ACCEPTABLE TO GIRIJA KOIRALA.  THE KING, RANA EXPLAINED, 
WOULD NOT ACCEPT A COMMUNIST PRIME MINISTER, SO THE LEADER OF 
THE CPN-UML, MADHAV KUMAR NEPAL, AND HIS COLLEAGUES ARE NOT 
CANDIDATES FOR PRIME MINISTER.  IN AN ASIDE, RANA EXPLAINED 
THAT DESPITE THE RELATIVE DISCIPLINE OF THE CPN-UML'S RULING 
CENTRAL COMMITTEE, OTHER PROMINENT MEMBERS OF THE CPN-UML 
DISLIKE MADHAV NEPAL AND WOULD OPPOSE HIS BEING NAMED PRIME 
MINISTER. MADHAV NEPAL, HOWEVER, HAS BEEN UNRELENTING IN 
PURSUIT OF THE PRIME MINISTERSHIP FOR HIMSELF AND HAS BEEN 
LOATHE TO SIGNAL SUPPORT FOR ANYONE ELSE. 
 
¶5. (C) CURRENTLY THE KING'S PREFERRED CANDIDATE FOR 
COMPROMISE PRIME MINISTER IS PARLIAMENTARY SPEAKER TARANATH 
RANABHAT.  RANA SAID THAT HE HAD EXPLAINED TO KOIRALA THAT 
THE SPEAKER HAS A NUMBER OF ADVANTAGES AS PRIME MINISTER, VIZ: 
 
-- ALTHOUGH PARLIAMENT HAS BEEN DISSOLVED, RANABHAT CONTINUES 
TO SERVE AS SPEAKER, THE MOST PROMINENT CONSTITUTIONAL 
POSITION STILL ACTIVE. 
 
-- DESPITE TENSIONS BETWEEN RANABHAT AND HIS PARTY LEADERS 
SINCE HIS APPOINTMENT AS SPEAKER, HE REMAINS INDISPUTABLY A 
MEMBER OF THE NEPALI CONGRESS PARTY. 
 
-- SINCE RANABHAT HAS NO INDEPENDENT POLITICAL FOLLOWING, HE 
WILL BE MORE DEPENDENT THAN MANY OTHER CANDIDATES ON THE 
NEPALI CONGRESS LEADERSHIP FOR POLICY GUIDANCE. 
 
-- RANABHAT SHOULD BE ACCEPTABLE TO OTHER PARTIES, WITH WHICH 
HE HAD WORKED WELL DURING HIS TENURE AS SPEAKER. (RANA SAID 
HE BELIEVED THAT THE RPP AND SABHAVANA PARTIES ALREADY 
SUPPORTED RANABHAT, AND DEUBA MAY BE MOVING IN THAT 
DIRECTION.) 
 
-- THE SPEAKER HAS SAID PUBLICLY THAT HE WILL NOT CONTEST 
FORTHCOMING ELECTIONS OR SEEK OTHER POLITICAL OFFICE. 
 
WHAT HE DID NOT MENTION TO KOIRALA, RANA ADDED, IS THAT 
RANABHAT HAS A BETTER REPUTATION FOR PROBITY THAN THE 
POLITICAL PARTY LEADERS.  DESPITE ALL THESE ADVANTAGES, RANA 
SAID, RANABHAT'S CANDIDACY WAS REJECTED BY KOIRALA, WHO 
ARGUED THAT THE SPEAKER WOULD BECOME ANOTHER DEUBA AND SPLIT 
HIS PARTY AGAIN. 
 
¶6. (C) ACCORDING TO RANA, THE KING'S NEXT STEP PROBABLY WOULD 
BE TO CALL ANOTHER MEETING IN THE PALACE WITH ALL THE PARTIES 
TO PRESENT THEM WITH AN ULTIMATUM.  THE KING WOULD GIVE THEM 
A LIMITED AMOUNT OF TIME (PERHAPS AS LITTLE AS 24 HOURS) TO 
PROVIDE HIM WITH THE NAME OF AN AGREED CANDIDATE FOR PRIME 
MINISTER. (RANA WAS UNSURE HOW MANY PARTIES WOULD BE INVITED 
TO THIS MEETING. HE SAID THE KING MIGHT INVITE AS MANY AS 
SEVEN OR EIGHT PARTIES ALTHOUGH TECHNICALLY THERE ARE ONLY 
THREE "NATIONAL PARTIES": THE NEPALI CONGRESS, THE CPN-UML, 
AND THE RPP. OTHER PARTIES ARE RECOGNIZED BY THE ELECTION 
COMMISSION AND HAD MEMBERS IN THE PAST PARLIAMENT EVEN THOUGH 
THEY FAILED TO WIN EVEN THREE PERCENT OF THE TOTAL VOTE. 
OTHER PARTIES, LIKE THE FACTION OF THE NEPALI CONGRESS HEADED 
BY FORMER PM DEUBA AND THE BREAKAWAY FACTION OF THE SABHAVANA 
PARTY, ARE NOT REGISTERED AS OFFICIAL PARTIES.) REGARDING THE 
DEMAND OF THE FIVE AGITATING PARTIES THAT THE KING 
ACKNOWLEDGE FORMALLY THAT HE IS RETURNING TO THE NEPALI 
PEOPLE THE SOVEREIGNTY THAT HE ASSUMED "TEMPORARILY" HIMSELF 
WHEN HE DISSOLVED THE GOVERNMENT IN OCTOBER 2003, RANA SAID, 
THE KING WAS PREPARED TO RELEASE A STATEMENT TO THE PRESS TO 
THAT EFFECT WHEN HE ANNOUNCES A NEW PRIME MINISTER.  THE KING 
IS NOT WILLING, HOWEVER, TO ACCEDE COMPLETELY TO THE PARTIES' 
DEMAND THAT ALL CABINET PORTFOLIOS BE HELD BY PARTY MEMBERS. 
THE KING IS INCLINED, RANA EXPLAINED, TO APPOINT A FEW 
PROMINENT MEMBERS OF CIVIL SOCIETY TO HEAD ESPECIALLY 
TECHNICAL MINISTRIES. 
 
¶7. (C) RANA EXPLAINED THAT HE HAD NOT CONSULTED RECENTLY WITH 
INDIAN AMBASSADOR SHYAM SARAN, BUT BELIEVED THAT SARAN, AFTER 
STRENUOUS EFFORTS TO BROKER AN AGREEMENT AMONG THE PARTIES, 
HAD CONCLUDED THAT GIRIJA KOIRALA AND MADHAV NEPAL WERE 
"UNBENDABLE."  IF ANYONE WOULD BE ABLE TO BRING THE PARTIES 
AROUND, RANA SAID, IT WOULD BE THE INDIANS, AND THEY HAD 
FAILED.  HE SAID HE COULD NOT BE CERTAIN, BUT BELIEVED THAT 
THE KING HAD CHARGED OTHER PERSONAL REPRESENTATIVES TO TRY TO 
REASON WITH MADHAV NEPAL, HAS RANA HAD DONE WITH KOIRALA. ONE 
POSITIVE DEVELOPMENT, HE NOTED, IS THAT THE PARTY LEADERS NO 
LONGER INSIST THAT THE KING ADDRESS THEIR 18-POINT PROGRAM OR 
DEMAND RESTORATION OF THE LAST PARLIAMENT.  RANA ADMITTED 
THAT THE KING DOES NOT ALWAYS FOLLOW HIS ADVICE, BUT HE HAD 
PRESSED THE MONARCH TO MAKE A DECISION SOON BECAUSE 
INACTIVITY WAS ERODING HIS POPULAR SUPPORT. THE KING COULD 
CALL THE PARTIES TOGETHER AGAIN AS SOON AS MAY 31, HE 
PREDICTED. 
 
¶8. (C) COMMENT: ALTHOUGH PRABAKHAR RANA'S BRIEFING WAS, AS 
USUAL, WELL-REASONED AND SOMEWHAT ENCOURAGING IT IS STILL NOT 
CLEAR THAT THE TWO MAJOR LEADERS OF THE AGITATING PARTIES ARE 
 RECONCILED TO ACCEPTING SOMEONE ELSE AS PRIME MINISTER AND 
WILL EITHER BE ABLE TO REACH A CONSENSUS ON A NEW PM OR 
SUPPORT A GOVERNMENT HEADED BY ANOTHER ROYAL APPOINTEE.  IN 
FACT, BEFORE THE DAY ENDED, A SPOKESMAN FOR THE NEPALI 
CONGRESS PUBLICLY REJECTED THE NOTION OF TARANATH RANABHAT AS 
PM. IF THE PRINCIPAL PARTIES REMAIN OBDURATE, A NEW 
GOVERNMENT UNDER A NEW PRIME MINISTER WILL HAVE ACHIEVED 
LITTLE TOWARD RESOLVING NEPAL'S POLITCAL IMPASSE.  END 
COMMENT. 
BOGUE