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 NEW DELHI 000859 
 
SIPDIS 
 
E.O. 12958: DECL: 02/02/2015 
TAGS: PREF PREL PHUM IN NP BT UNHCR
SUBJECT: GOI REWARDS BHUTANESE KING AS GUEST OF HONOR AT 
REPUBLIC DAY 
 
REF: NEW DELHI 6920 
 
Classified By: DCM Robert Blake, Jr. for Reasons 1.4 (B, D) 
 
¶1.  (C) Summary:  The Government of India (GOI) rewarded 
Bhutanese King Jigme Singye Wangchuck for conducting military 
operations in December of 2003 against Indian militants 
hiding out in Southern Bhutan by making him the guest of 
honor at Republic Day.  During the King's January 24-28 
visit, the GOI privately pressed the Bhutanese to find a 
solution to the ongoing refugee problem with Nepal and 
announced a significant increase in the GOI's development 
assistance.  King Wangchuck stated the Royal Government of 
Bhutan (RGOB) will release a draft constitution in March, 
highlighted the Kingdom's concerns about Maoist activities in 
Nepal, announced a plan to build a number of railway links 
between the two countries, reiterated the RGOB's commitment 
to the repatriation of Category 1 refugees, discussed 
Sino-Bhutanese relations and announced that he was trying to 
cut down smoking cigarettes.  End Summary. 
 
Militants in the North East 
--------------------------- 
¶2.  (C) King Wangchuck held the position as guest of honor 
during the January 26 Republic Day celebration, a reflection 
of the GOI's appreciation for Bhutan's successful military 
operations against Indian militants in December 2003. 
According to a number of pundits who follow Bhutan, this 
decision highlighted the importance of the fight against the 
insurgents in North-East India and demonstrated New Delhi's 
gratitude to the RGOB for carrying out the mission. 
 
Category 1 Refugees 
------------------- 
¶3.  (C) MEA Joint Secretary Ranjit Rae (Nepal and Bhutan) 
told Polcouns and poloffs on February 2 that the King 
reiterated his commitment to the Dewey/Wangchuck framework 
for repatriation of Category 1 refugees (Reftel) during his 
visit, but stated that it depends on the security situation 
in Nepal.  In one of his media interactions, the King 
reportedly stated a majority of the refugees in the camps are 
not Bhutanese citizens.  However, in a February 2 meeting 
with Poloff, Bhutanese First Secretary Karma Rinchhen 
commented that this was not a policy change.  The RGOB has 
never considered a majority of the refugees to be citizens 
and he argued the people in Category 2 gave up citizenship 
when they left Bhutan.  However, Rinchhen noted that under 
the terms of the bilateral process, these people will have 
the option to reapply for citizenship. 
 
¶4.  (C) Rae commented that he thought the plan to repatriate 
Category 1's was "a pretty good initiative" and wondered why 
it had not succeeded.  He said the GOI had pressed the King 
to accept the Category 1's and revive the bilateral process. 
Rae stressed the need to have the Nepalese and Bhutanese 
ambassadors meet on the issue in Delhi, arguing that not 
every aspect of the negotiations should go through formal 
letters between the two capitols.  India has also made this 
point to Kathmandu.  Rae inquired about numbers for possible 
third country resettlement in the U.S., emphasizing the point 
that other solutions could become clear if this information 
was available.  Polcouns reiterated our standard line on this 
issue. 
 
Power to the People 
----------------- 
¶5. (U) During a January 30 meeting with journalists, King 
Wangchuck reiterated his commitment to devolving authority 
and creating a constitutional monarchy, announcing that the 
draft constitution would be released in March.  He stated he 
plans to travel throughout Bhutan holding meetings to promote 
the new constitution before the document is put up for a 
referendum later in the year.  King Wangchuck explained that 
Bhutan is coming to the end of a long transition, which began 
in 1991, from a monarchy to democracy and will implement a 
constitution with an amalgamation of ideas from a number of 
other countries.  He commented that, when implemented, the 
constitution will clearly define the role of the monarchy. 
Foreshadowing the Trouble in Nepal 
---------------------------------- 
¶6.  (U) Four days prior to King Gyanendra of Nepal's decision 
to dismiss the Deuba government and take over power, King 
Wangchuck expressed concern that the situation in Nepal was 
deteriorating day-by-day and that "as friends and neighbors, 
we do not want the situation (to get) out of control."  The 
Maoists hold sway in 69 districts, stated Wangchuck, but he 
hoped that "something good, something positive" would come 
out of the situation. However, he warned that the Maoists had 
almost total control over Nepal and the situation could 
become "much more serious than it is today," having negative 
implications for both India and Bhutan. 
 
¶7.  (C) Bhutanese First Secretary Karma Rinchhen told poloff 
on February 2 that the RGOB did not intend to make any public 
statement concerning the change in government in Nepal, but 
that it was not considered "a good thing."  He added that the 
RGOB is going to take a wait and see approach to the 
situation.  He argued that if King Gyanendra shows that he 
can make progress in the fight against the Maoists and bring 
real security to Nepal "how can that not be seen as a 
positive development?"  Rinchhen added that the Deuba 
administration had not effectively dealt with the insurgency, 
but the removal of his government will be problematic if the 
situation continues to spiral out of control.  Rinchhen was 
very interested in how the change in regime would effect U.S. 
aid to the region, specifically in terms of military 
assistance.  He reiterated RGOB concerns of a Maoist 
spill-over into Bhutan and links between the Maoists and the 
United Liberation from of Assam (ULFA), National Democratic 
Front of Bodoland (NDFB) and Kamtapur Liberation Organization 
(KLO).  When questioned if the RGOB believes if these groups 
were currently operational in Bhutan, he said no, "but the 
threat is still there." 
 
Increase in Aid 
--------------- 
¶8.  (U) In connection with the King's visit, India has agreed 
to increase development assistance to Bhutan from Rs. 430 
crore (US $100 million) to Rs. 710 crore (US $165 million) 
during the current Five Year Plan (2002-2007).  According to 
the Bhutanese National newspaper (Kuensel), Bhutan and India 
signed three memorandums of understanding (MoU) during the 
King's visit focusing on development. The MoU's concerned 
cooperation on agriculture, continuing the development of the 
hydropower industry, and a feasibility study for a network of 
railway lines from five locations in Bhutan to connection 
points in India. Currently, there are no rail links between 
the two countries. 
 
China 
----- 
¶9.  (U) Numerous media outlets reported that the King's 
expression of optimism about resolving RGOB differences with 
China over disputed border areas.  He was quoted as saying 
that out of the 450 km frontier, only a small portion is 
under question.  He also de-linked Thimphu's decision not to 
have full diplomatic ties with China from the boundary 
dispute, stating that Bhutan does not have full diplomatic 
relations with any of the five permanent members of the UNSC. 
 When questioned how this policy could change if India 
receives a seat on the council (which Bhutan supports), he 
commented, "This (policy) can't apply to India. It would be 
like divorcing your wife." 
 
No Smoking in Shangri La 
------------------------ 
¶10.  (U) In response to the recent ban on smoking in public 
places in Bhutan and the announcement of 100 percent sales 
and imports taxes on cigarettes, King Wangchuck announced 
that he, as a smoker, would try and cut back on the habit. 
When asked how many cigarettes he smokes a day, he quipped, 
"I don't want to tell you. With four wives, I better stop 
smoking." 
 
Comment 
------- 
¶11.  (C) In wake of the decision by King Gyanendra of Nepal 
to dismiss the coalition government on February 1 and the 
Bhutanese government's often stated concerns for the security 
of their Joint Verification Teams, it is unlikely the 
repatriation of Category 1 refugees according to the 
Dewey/Wangchuck framework will occur in the near future. 
While the RGOB maintains they are committed to the Joint 
Verification Process, the combination of the implementation 
of the new constitution, the upheaval in Nepal and concerns 
over Maoist infiltration in the refugee camps will likely 
result in RGOB delaying the process.  In the meantime, 
however, GOI support for the Dewey/Wangchuck framework, and 
New Delhi's willingness to weigh in on this topic with 
Thimphu is a hopeful signal of India's willingness to join 
forces with us in pursuit of a long term solution to the 
refugee problem.  End Comment.) 
MULFORD