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FM AMEMBASSY KATHMANDU
TO RUEHLM/AMEMBASSY COLOMBO IMMEDIATE 5775
INFO RUEHC/SECSTATE WASHDC IMMEDIATE 5191
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UNCLAS SECTION 01 OF 03 KATHMANDU 000493 
 
SIPDIS 
 
SIPDIS 
 
COLOMBO PLEASE PASS U/S FORE, FROM THE AMBASSADOR 
 
E.O. 12958: N/A 
TAGS: AMGT PGOV PRELNP
SUBJECT: SCENESETTER FOR YOUR VISIT TO NEPAL 
 
 
¶1.  Henrietta, I'm delighted that you are able to make it out 
to Nepal, at this crucial point in the country's history. 
You will find a fascinating country, great weather, and a 
talented country team that is getting the Mission fully ready 
for the 21st century.  You will also find a country that is 
teetering on the brink of becoming either a showcase for 
democratic transformation or a failed or totalitarian state 
threatening stability in the region. 
 
The Political Context 
--------------------- 
 
¶2.  More than ten months ago, a People's Movement (jana 
andolan, in Nepali), supported both by Nepal's legitimate 
political parties and by its Maoist insurgents, forced King 
Gyanendra to abandon his attempts at absolute rule and 
surrender power to a reinstated Parliament.  Since then, 
negotiations between the parties and the Maoists have 
resulted in a series of agreements ending the insurgency and 
setting out a process supposedly leading to elections for a 
Constitutional Assembly by mid-June and to the absorption of 
the Maoists into the democratic mainstream.  Always fragile, 
this process appears currently to be at great risk. 
 
Getting the Maoists into the Mainstream 
--------------------------------------- 
 
¶3.  Perhaps the gravest threat to the peace process comes 
from the Maoists.  Despite a series of signed commitments, 
they have not yet abandoned violence, intimidation, and 
extortion.  Indeed, both their actions and their leaders 
words suggest that their goal remains a monopoly on state 
power and not power-sharing within some democratic framework. 
 To date, the government has facilitated Maoist obduracy by 
refusing to enforce the law and crack down on Maoist abuses 
for fear that doing so would force the erstwhile insurgents 
to resume fighting.  Instead, the government has made a 
series of unilateral concessions to the Maoists, including 
giving them the keys to UN-monitored containers where they 
agreed to place their weapons and granting them one-quarter 
of the seats in an Interim Parliament. 
 
¶4.  Having violated their most fundamental commitments, the 
Maoists now hope to be granted a number of Ministries in a 
yet-to-be-formed, eight-party Interim Government.  They argue 
that further delay in formation of the Interim Government 
could prevent the holding of Constitutional Assembly 
elections before mid-June (which is the beginning of monsoon 
rains in Nepal).  At the same time, they openly maintain that 
the speedy holding of Constitutional Assembly elections is 
less important than immediately removing the King and 
declaring Nepal a "democratic republic."  They have 
threatened to take to the streets, if the Interim Parliament 
does not take action soon against the King. 
 
¶5.  For once, the political parties appear to have dug in, as 
have key members of the international community.  The Prime 
Minister has bluntly told the Maoists that he will not allow 
them into an interim government until their behavior changes 
in a number of key areas, including by returning captured 
land to its original owners and ending extortion.  For their 
part, the Indians have insisted that the UN-administered arms 
management process must be credible before the Maoists are 
allowed into government.  (To date, the Maoists have placed 
over 30,000 supposed combatants into UN-supervised 
cantonments, but have only placed 3,400 weapons into 
containers at those cantonments.  The majority of the alleged 
combatants appear to be recent recruits and children.)  The 
Maoists are also finding their influence in large parts of 
the country diminished by a flaring up of ethnic tensions. 
 
Addressing Marginalized Groups 
------------------------------ 
 
¶6.  Expectations among Nepal's many marginalized groups were 
raised by Maoist calls during the insurgency for regional 
 
KATHMANDU 00000493  002 OF 003 
 
 
autonomy and ethnic rights, as well as by hopes that the 
Constitutional Assembly process would lead to their having a 
greater say in national affairs.  These expectations went 
largely unmet, however, as the parties and the Maoists cut a 
deal behind closed doors in January on the Interim 
Constitution that did almost nothing to address the 
grievances of the marginalized groups.  This failure to 
address expectations has resulted in considerable 
disappointment among these groups, who appear increasingly 
inclined to use violence to advance their cause. 
 
¶7.  The first group to hit the streets to demand action was 
the Madhesis, relatively recent immigrants from India who 
live in Nepal's southern plains (the Terai) and account for 
about one-third of Nepal's population.  In February, the 
Madhesis called a ten-day strike that closed the roads from 
India, leading to severe shortages of petroleum and food in 
Kathmandu and elsewhere.   Clashes between the Madhesis and 
the Maoists (who view the Madhesi movement as a threat to 
Maoist standing in the Terai) and police (who contain very 
few Madhesis in their ranks) have to date resulted in over 
thirty deaths.  The Madhesis are demanding greater 
representation in the Constitutional Assembly, as well as the 
resignation of the Home Minister, whom they hold responsible 
for alleged police brutality in the Terai.   The government 
has yet to hold serious talks with the Madhesis and instead 
has sought to defuse tensions by proposing constitutional 
reforms, the precise contents of which remain unknown.  In 
addition to the Madhesis, the Janjatis (ethnic Tibeto-Burmans 
who comprise about 35 percent of Nepal's population) are 
demanding a greater share of power.  Other groups, including 
Nepal's dalits (or untouchable castes - 15 percent of the 
population) and women (51 percent of the population) are also 
beginning to demand a voice.  While these are precisely the 
sort of questions that a Constitutional Assembly should 
discuss, the government's unwillingness to engage in a 
roundtable dialogue with the disaffected groups has allowed 
the situation to fester and raised fears that the government 
and parties wish to keep power in the hands of the political 
elite. 
 
Management Issues 
----------------- 
 
¶8.  We are eagerly awaiting our June move into a 
state-of-the-art New Embassy Compound (NEC).  For the first 
time, USAID will be co-located with the rest of the Mission, 
making communication and policy coordination much easier.  We 
are also making considerable progress in working out joint 
services between State and AID, a process which you will hear 
more about during your visit.  While the outlook on most 
issues appears bright, we still have several challenges to 
address. 
 
LIBRARY 
 
 -- The Mission desires to keep the American library at its 
current location. 
 
 -- The library receives over a hundred visitors a day and 
provides our most effective tool for reaching out to the 
Nepali public. 
 
 -- We will not have the space, nor will we have the 
relatively easy security access, to replicate these functions 
at the NEC. 
 
 -- We await a Washington decision on the request for a 
co-location waiver. 
 
BUDGET CRUNCH 
 
 -- We find ourselves in a budget crunch, aggravated by 
increasing load-shedding and chronic political instability. 
 
 -- Load-shedding due to increase in the coming weeks. 
 
KATHMANDU 00000493  003.3 OF 003 
 
 
 
 -- We are currently running our generators six hours a day, 
using up large amounts of diesel fuel. 
 
 -- Frequent closures of the roads and border because of 
strikes and other disturbances make obtaining supplies from 
India (the only source of most goods we need) both expensive 
and unreliable. 
 
What You Can Do for Us 
---------------------- 
 
¶9.  I am proud of this Mission and of what we have 
accomplished under frequently trying conditions.  I hope your 
trip will provide you a clear understanding of the 
complexities of Nepal and of how we have been seeking to 
promote U.S. interests here.  I have also been stressing to 
the Nepalis that you will be the most senior U.S. official to 
visit the country since last April's Jana Andolan.  As such, 
you will be looked upon as the oracle who will reveal 
Washington's views on Nepal's fast-paced developments.  In 
your conversations with Nepalis, you might therefore want to 
concentrate on a few core themes: 
 
-- The U.S. strongly supports Nepal's peace process, and we 
will do what we can to help ensure its success.  We want to 
see a peaceful, prosperous, and democratic Nepal. 
 
-- We thus want to see the Maoists come into the political 
mainstream and endorse the values of democracy.  To date, 
however, Maoist actions and words cast doubt upon their 
commitment to democracy.  Until they support the rule of law 
and abandon violence and intimidation, the Maoists can not be 
considered a mainstream political party.  No legitimate party 
practices politics through the barrel of a gun 
 
-- We have no position on the future of the monarchy.  That 
is for the people of Nepal to decide. 
 
-- We hope that the political parties and government will 
find ways to listen to the voices of all of Nepal's people 
and bring them all into an inclusive, democratic society.  At 
the same time, nothing justifies the use of violence as a 
political tool, including by groups that legitimately feel 
marginalized within their society. 
 
I look forward to your arrival. 
MORIARTY