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C O N F I D E N T I A L SECTION 01 OF 05 KATHMANDU 000669 
 
SIPDIS 
 
SIPDIS 
 
NEW DELHI PLEASE PASS TO SCA ASSISTANT SECRETARY BOUCHER 
 
E.O. 12958: DECL: 04/01/2017 
TAGS: PGOV PTER NP
SUBJECT: NEPAL: INTERIM GOVERNMENT WITH MAOISTS SWORN IN, 
ANNOUNCES JUNE ELECTION 
 
Classified By: Ambassador James F. Moriarty.  Reasons 1.4 (b/d). 
 
Summary and Introduction 
------------------------ 
 
¶1. (C) On April 1, after days of bickering between the 
parties, Prime Minister and Nepal Congress (NC) President 
G.P. Koirala administered the oath of office to an interim 
Nepali government.  The 16 ministers and five state ministers 
include five Maoists.  Koirala once again kept the defense 
ministry for himself.  Contrary to expectations, the 
ineffectual Krishna Prasad Sitaula (NC) was re-appointed Home 
Minister.  There was no change at Finance either: Ram Sharan 
Mahat (NC) was re-named.  Ram Chandra Poudel (NC's General 
Secretary) was tapped to head the newly established Peace and 
 
SIPDIS 
Reconciliation Ministry and serve as the senior member of the 
cabinet.  Sahana Pradhan, who is 75, replaced her Communist 
Party of Nepal-United Marxist Leninist (CPN-UML) colleague 
K.P. Oli as Foreign Minister.  Maoist spokesman and chief 
peace negotiator Krishna Mahara became Minister for 
Information and Communication and the senior Maoist in the 
interim cabinet.  The eight parties reportedly signed a 
Common Minimum Program, a Ministerial Code of Conduct, and a 
restatement of prior peace commitments between the 
Seven-Party Alliance (SPA) and the Maoists.  The parties also 
agreed to hold the Constituent Assembly election on June 22. 
 
Interim Government Sworn In 
--------------------------- 
 
¶2. (SBU) At 1:30 p.m. on April 1, the Interim Parliament 
unanimously re-appointed Girija Prasad Koirala to be the 
Prime Minister of the Interim Government.  Koirala, who is 
also President of the Nepali Congress (NC), had presented his 
resignation as PM of the previous government to the Speaker 
shortly before.  The Prime Minister subsequently administered 
the oath of office and secrecy to 16 ministers and five state 
ministers at the National Planning Commission.  The names of 
the new ministers were then read in the Parliament in a 
ceremony attended by the Ambassador and other members of the 
diplomatic corps.  The NC, the CPN-UML, the Communist Party 
of Nepal-Maoist (Maoist), and Nepali Congress-Democratic 
(NC-D) divided the top portfolios among themselves.  Other 
minor parties in the Seven-Party Alliance (SPA) split up the 
remaining ministries: one to the Terai-based Nepal Sadbhavana 
("Goodwill") Party-Anandi Devi (NSP-A), one to the People's 
Front Nepal (PFN), and one to the United Left Front (ULF). 
The parties agreed there would be no Deputy Prime Minister. 
 
Other Agreements Reached/Elections Announced 
-------------------------------------------- 
 
¶3. (SBU) The eight parties reportedly signed three agreements 
before the swearing-in ceremony: a Common Minimum Program for 
the Interim Government, a code of conduct for the ministers, 
and a restatement of past agreements between the Maoists and 
the SPA.  The restatement included provisions binding the 
Maoists to end extortion, intimidation, and violence and 
provided for the establishment of a monitoring committee. 
(Note:  All of these commitments had been covered in previous 
agreements as well, including the November 2006 Comprehensive 
Peace Agreement.  End note.)  The eight parties also agreed 
to hold the Constituent Assembly election on June 22.  A 
further agreement was reportedly reached which would allow 
the Interim Parliament to declare Nepal a republic through a 
two-thirds majority vote if royalists were to attempt to 
sabotage the June 22 election. 
 
Party Bickering Holds Up Decision 
--------------------------------- 
 
¶4. (SBU) Although an agreement on the formation of the 
interim government was reached the evening of March 30, 
continued bickering among the parties over who would fill the 
cabinet seats, especially between the NC and CPN-UML, held up 
the final decision.  The CPN-UML appointed Sahana Pradhan, an 
ailing 75 year-old woman, who had held a senior position in 
 
KATHMANDU 00000669  002 OF 005 
 
 
the democratic government formed after the 1990 People's 
Movement, as its Foreign Minister nominee and the leader of 
its delegation in the government.  This was widely seen as an 
effort to ensure that she would be declared the senior-most 
minister and, thus, first in the line of succession to the 
Prime Minister.  According to press reporting, PM Koirala 
wanted that position to go to someone in his own NC party 
instead.  After hours of argument, during which the CPN-UML 
held an emergency meeting, the eight parties agreed that NC 
General Secretary Ram Chandra Poudel would be the senior-most 
minister; Pradhan would hold the next position, followed by 
Maoist Information Minister Krishna Mahara. 
 
Ministerial Portfolios 
---------------------- 
 
¶5. (SBU) The Ministers in the new government, their 
portfolios, and party affiliation are as follows: 
 
Nepali Congress Party 
 
- Prime Minister: Girija Prasad Koirala 
 
- Defense Minister: Girija Prasad Koirala 
- Peace and Rehabilitation Minister: Ram Chandra Poudel 
- Minister for Science and Technology: Mahanta Thakur 
- Finance Minister: Ram Sharan Mahat 
- Home Minister: Krishna Prasad Sitaula 
- State Minister: Indra Bahadur Gurung (portfolio unclear as 
of this writing) 
 
 
Communist Party of Nepal-United Marxist Leninist 
 
- Minister of Foreign Affairs: Sahana Pradhan 
- Minister for Education and Sports: Pradeep Nepal 
- Minister of Culture, Tourism, and Civil Aviation: Prithvi 
Subba Gurung 
- Minister of Agriculture and Cooperatives: Chhabi Lal 
Biswokarma 
- State Minister for General Administration: Ram Chandra Yadav 
- State Minister for Education and Sports: Mahendra Singh 
Rathore 
 
 
Communist Party of Nepal-Maoist 
 
- Minister for Information and Communication: Krishna Bahadur 
Mahara 
- Minister for Local Development: Dev Gurung 
- Minister for Works and Physical Planning: Hisila Yami 
- Minister for Forest and Soil Conservation: Matrika Prasad 
Yadav 
- Minister for Women, Children and Social Welfare: Khadga 
Bahadur Biswokarma 
 
 
Nepali Congress-Democratic 
 
- Minister for Law, Justice, and Parliamentary Affairs: 
Narendra Bikram Nemwang 
- State Minister for Labor and Transport Management: Ramesh 
Lekhak 
- State Minister for Water Resources: Gyanendra Bahadur Karki 
 
 
Nepal Sadbhavana Party-Anandi Devi 
 
- Minister of Industry, Commerce, and Supplies: Rajendra 
Mahato 
 
 
United Left Front 
 
- Minister of Land Reform and Management: Jagat Bahadur Bogati 
 
 
 
KATHMANDU 00000669  003 OF 005 
 
 
People's Front Nepal 
 
- Minister of Health: Amik Sherchan 
 
 
Eight Parties Agree on Common Minimum Program 
--------------------------------------------- 
 
¶6. (SBU) The eight parties reportedly agreed on a Common 
Minimum Program (CMP) to promote "Nepal's national interest, 
democracy, and progression."  The main points in the CMP are: 
 
- A free and fair Constituent Assembly election on June 22. 
- Promotion of competitive politics, human rights, and press 
freedom. 
- Strict implementation of November 2006 peace accord. 
- Formation of peace and rehabilitation, truth and 
reconciliation, and state restructuring commissions. 
- Reformation of the Nepal Army, and formation of a special 
cabinet committee to oversee, integrate, and rehabilitate 
Maoist combatants. 
- Proper management of Maoist cantonments. 
- An end to corruption. 
- Nationalization of royal property. 
- End to strikes and bandhs (closures). 
- Reconstruction of destroyed infrastructure. 
- Declaration of education and health institutions as peace 
zones. 
- Creation of an investment-friendly environment. 
- Strong action against willful loan defaulters. 
- Creation of a common development strategy and effective 
social reforms and welfare programs. 
 
Code of Conduct for the Ministers 
--------------------------------- 
 
¶7. (SBU) The eight parties reportedly agreed on a code of 
conduct for the ministers in the Interim Government.  It 
consists of: 
 
- Immediate ouster of ministers involved in corruption. 
- Political appointments to be based on political consensus. 
- Implementation of eight-party decisions the major duty of 
Ministers. 
- No public comment on matters of cabinet debate. 
- Respect for a coalition culture. 
 
Restatement of Peace Commitments 
-------------------------------- 
 
¶8. (SBU)  The eight parties reportedly signed an agreement 
reemphasizing previous commitments between the SPA and the 
Maoists.  The main points are: 
 
- The Maoists will stop extortion and intimidation and return 
all seized property. 
- Government forces and the Maoists will vacate all 
forcefully captured buildings. 
- All weapons outside of cantonments will be declared illegal. 
- A joint committee will be formed for monitoring all peace 
agreements. 
 
Embassy Releases Press Statement 
-------------------------------- 
 
¶9. (U) Post released a statement after the formation of the 
interim government.  Text is below: 
 
Begin text. 
 
U.S. Embassy Backs Peace Process, CA Elections As Soon As 
Possible 
 
Upon formation of the Interim Government, the U.S. Embassy 
reaffirms its full support for the peace process in Nepal. 
The next step in this process should be the holding of 
Constituent Assembly elections as quickly as possible. 
 
KATHMANDU 00000669  004 OF 005 
 
 
 
The government must create an atmosphere for free and fair 
elections by vigorously enforcing law and order throughout 
the country. 
 
The Communist Party of Nepal (Maoist), which to date has 
refused to abandon violence, must finally do so.  As a 
partner in the Interim Government, the Maoists must now be 
held fully accountable for their actions.  They must meet 
their commitments and at last join the mainstream as a 
non-violent political party. 
 
The United States also urges the new government to initiate a 
comprehensive national dialogue with all ethnic groups to 
hear their grievances and to promote unity.  If the peace 
process is to succeed, unity must be forged, law and order 
enforced, and security maintained.  The Nepali people deserve 
nothing less from their servants - the new Interim Government. 
 
End text. 
 
Comment: Maoists Appear The Big Winners... 
------------------------------------------ 
 
¶10. (C) Without having to make any changes in their behavior, 
the Maoists have won yet another battle with Nepal's 
democratic parties, and Nepal's citizens are likely to suffer 
the consequences.  Now that the Maoists are inside the 
Interim Government, Prime Minister Koirala's Nepali Congress 
and its two principal allies, the CPN-UML and the Nepali 
Congress - Democratic, will find it even more difficult to 
force the Maoists to end their abuses.  Unlike some observers 
here, who expect the responsibilities of government to have a 
moderating effect on the Maoists, we expect them rather to be 
emboldened.  The PM's astonishing decision to re-appoint the 
weak, Maoist-accomodating Krishna Sitaula as Home Minister 
sends exactly the wrong signal on enforcing law and order. 
NC insiders report that Koirala, who was primed to dump 
Sitaula, kept him on after the Maoists said they would not 
join the government if the Home Minister were changed.  The 
Government of India's (GOI) insistence on rapid formation of 
an interim government, with Maoists, presumably played a role 
in Koirala's decision to cave to this latest example of 
Maoist political blackmail. 
 
...The Terai Likely To Boil?... 
------------------------------- 
 
¶11. (C) Sitaula's retention leaves little hope that law 
enforcement will improve.  Moreover, the main demand of the 
protesting groups in the Terai was Sitaula's resignation. 
Continuing unrest in that crucial border region could make it 
extraordinarily difficult for the new government to stick to 
its June 22 date for the Constituent Assembly election.  The 
United Nations Mission in Nepal has already privately 
indicated that it is not technically feasible to hold free 
and fair elections by then.  A combination of continuing 
Maoist atrocities, growing unrest in the Terai, and mounting 
dissatisfaction among Nepal's ethnic minorities will bedevil 
Nepal's political situation in the run-up to the scheduled 
election. 
 
Making Lemonade... 
------------------ 
 
¶12. (C) With the Maoists attempting to squeeze the life out 
of Nepal's fledgling democracy and the parties committed to 
an unrealistic date of June 22 for the election, we are now 
in crunch-time.  The United States and other key 
international actors have less than three months to assist 
Nepal's Election Commission with the technical aspects of 
Nepal's election preparations and to strengthen the Nepali 
Police's effort to provide election security.  We also have 
little time left to get a large number of election observers 
on the ground to bolster domestic efforts to hold the Maoists 
to their commitment to free and fair elections.  Meanwhile, 
if Maoist intimidation and violence continue, and the 
 
KATHMANDU 00000669  005 OF 005 
 
 
elections become tainted, we need to make sure that both 
international and domestic observers are ready to call the 
entire exercise a sham and that the Maoists are aware of 
this.  The United Nations and India will play a significant 
role in the coming weeks, but if we are to contribute in 
these key areas, we will need additional resources and 
high-level support. 
 
¶13. (C) As we have just seen, India wields considerable 
influence here, and we need to make sure that influence is a 
positive one.  Based on reporting from Embassy New Delhi, the 
GOI appears to be convinced that a reasonably free and fair 
Constituent Assembly election can be pulled off by June.  We 
hope the GOI is right.  The South Asian Association for 
Regional Cooperation (SAARC) Summit, which begins the week of 
April 2 in New Delhi, provides us with the perfect 
opportunity to better understand why Nepal's closest partner 
holds this more optimistic view.  If the U.S. and India can 
ensure our policies are closely coordinated, perhaps that 
brighter future will become a reality. 
MORIARTY