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O 091017Z FEB 09
FM AMEMBASSY KATHMANDU
TO RUEHC/SECSTATE WASHDC IMMEDIATE 9724
INFO RUEHBJ/AMEMBASSY BEIJING PRIORITY 6796
RUEHLM/AMEMBASSY COLOMBO PRIORITY 7084
RUEHKA/AMEMBASSY DHAKA PRIORITY 2400
RUEHIL/AMEMBASSY ISLAMABAD PRIORITY 5130
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RUEHNE/AMEMBASSY NEW DELHI PRIORITY 2819
RUEHCI/AMCONSUL KOLKATA PRIORITY 4435
RHMFIUU/CDR USPACOM HONOLULU HI PRIORITY
RUEAIIA/CIA WASHDC PRIORITY
RHEFDIA/DIA WASHDC PRIORITY
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RUEKJCS/SECDEF WASHDC PRIORITY
RUCNDT/USMISSION USUN NEW YORK PRIORITY 3424

UNCLAS SECTION 01 OF 03 KATHMANDU 000105 
 
SENSITIVE 
SIPDIS 
 
STATE FOR SCA/INS 
 
E.O. 12958: N/A 
TAGS: PREL PGOV PTER EAID PREF PHUM CH BT NP
SUBJECT: SCENESETTER FOR A/S BOUCHER'S VISIT TO NEPAL 
 
Introduction 
------------ 
 
¶1.  (SBU) U.S. Mission Kathmandu warmly welcomes you to 
Nepal.  Your visit will be the highest-level visit by a U.S. 
official since the Maoists won a plurality in the Constituent 
Assembly (CA) election in April 2008 and formed a coalition 
government in August. 
 
Bilateral Relations 
------------------- 
 
¶2.  (SBU) Bilateral relations have been better than expected 
given the Maoists' history of anti-U.S. rhetoric and the 
continued listing of the party on the U.S. terrorist 
exclusion and specially designated nationals lists.  The 
Government of Nepal (GON) -- despite its frequent 
denunciation of international "interference" -- has expressed 
eagerness for the U.S. to maintain, if not increase, its 
assistance and engagement in Nepal.  The Maoist Defense 
Minister has frequently expressed his interest in greater 
military-to-military cooperation.  In September, the Ministry 
of Finance signed the annual agreement to obligate U.S. 
foreign assistance to Nepal.  On January 23, the Deputy Chief 
of Mission and the Finance Secretary signed a Letter of 
Agreement covering long-term law enforcement assistance worth 
more than USD 2.5 million to the Home Ministry, Nepal Police, 
and Armed Police Force. 
 
Constituent Assembly 
-------------------- 
 
¶3.  (SBU) The 595-member CA has a dual mandate to draft a new 
constitution and function as a legislature.  It has made 
minimal progress in either role.  The first sitting of the CA 
occurred more than one month after the election.  The CA 
elected the President, Vice President, and CA Chairman in 
July, and the CA Vice Chairman only in November.  In 
November, the CA also set up its rules of procedure and 
passed the budget for the fiscal year that began in July. 
Various political parties, including the Madhesi parties and 
the Nepali Congress (NC), frequently disrupt proceedings to 
force the CA and GON to accept their demands.  The CA took 
almost seven months to form constitutional and legislative 
committees, and another month to select committee chairmen. 
On January 13, the CA elected Madhav Kumar Nepal, the former 
chief of the Communist Party of Nepal - United Marxist 
Leninist (UML), to head the principal drafting committee and 
oversee the 13 other constitutional committees.  The CA then 
went on recess from January 19, reportedly for a month and a 
half but with no confirmed date to reconvene. 
 
By-Elections 
------------ 
 
¶4.  (SBU) By-elections in six constituencies scheduled for 
April 10 -- one year to the day after the original CA 
election -- will bring the CA to its full membership of 601. 
Five of the by-elections will fill seats relinquished by CA 
members who won in more than one constituency:  Kanchanpur in 
the far west, Rolpa and Kaski in the midwestern and western 
hills respectively, and two constituencies in Morang in the 
eastern Terai.  Dhanusa, in the central Terai, will hold a 
by-election to fill the seat that Ram Baran Yadav vacated to 
become President.  Maoists won the first time around in Rolpa 
and Kaski.  Re-winning these seats and picking up additional 
seats would indicate de facto acceptance if not outright 
approval of the current government.  International 
organizations are unlikely to send election monitors for the 
by-elections, but resident diplomatic missions, INGOs already 
present in Nepal, and local NGOs plan to observe at the 
polling stations.  The U.S. Mission intends to send teams to 
each of the six constituencies, logistics and security 
permitting. 
 
Security Situation 
------------------ 
 
KATHMANDU 00000105  002 OF 003 
 
 
 
¶5.  (SBU) The law and order situation in Nepal, especially in 
the Terai, continues to worsen.  In October 2008, the GON 
formed a team consisting of the Maoist Peace and 
Reconstruction Minister and two Madhesi cabinet ministers to 
negotiate with armed groups.  As of February, the team has 
had little luck in initiating talks with the most influential 
armed leaders, and few observers are hopeful that the talks 
will succeed.  The Maoist-affiliated youth wing, which in 
late January added "Democratic" to its moniker to become the 
Young Communist Democratic League (YCDL), continues to engage 
in illegal activities such as threats, extortion and 
extra-judicial killings, as well as clashes with the police 
and other party-affiliated youth wings.  These other groups 
include the UML's Youth Force. 
 
Political Bickering 
------------------- 
 
¶6.  (SBU) The GON has made little progress on the wider peace 
process, and bickering within and among the political parties 
has not helped matters.  The opposition NC party complains 
about the Maoists' lack of implementation of previous 
agreements, especially returning seized land and reigning in 
the YCDL, and other parties even within the ruling coalition 
share the complaints.  Nevertheless, the NC tends to appear 
as obstructionist more often than not.  The three main 
Terai-based parties -- the Madhesi People's Rights Forum, the 
Terai-Madhes Democratic Party, and the Sadbhavana Party -- 
have failed to reassemble their short-lived coalition which 
collapsed at the time of the CA election. 
 
Army Integration 
---------------- 
 
¶7.  (SBU) The so-called "Army Integration Special Committee" 
(AISC), which Article 146 of Nepal's interim constitution 
empowers to supervise, integrate, and rehabilitate former 
Maoist combatants, had a delayed beginning.  After a false 
start in October on the eve of UN Secretary General Ban 
Ki-moon's visit, the committee had its first session, with NC 
participation, on January 16 and its second on February 5. 
The AISC is slated to take over some of the functions of the 
United Nations Mission to Nepal (UNMIN), which itself 
received an extension in late January until July 2009. 
 
Bhutanese and Tibetan Refugees 
------------------------------ 
 
¶8.  (SBU) Bhutanese refugee resettlement is well under way 
with more than 9,500 departures to third countries, including 
8,626 to the U.S. as of February 5.  Approximately 56,000 
additional Bhutanese refugees have expressed valid interest 
in resettling.  The GON is considering a U.S. offer to 
resettle 5,000 Tibetan refugees from Nepal.  The UN refugee 
agency (UNHCR) made a concurrent offer to assist in the 
registration of Tibetan refugees in Nepal, similar to the 
joint registration the GON and UNHCR undertook for Bhutanese 
refugees.  A countrywide registration program, coupled with 
the issuance of new identification cards, is essential both 
for resettlement and as a first step to enable Tibetans, some 
of whom have had the right to live in Nepal for the past 50 
years, the right also to work, own property, own a business, 
travel, and register births, marriages, and deaths.  The GON 
may have difficulty making a decision on resettlement and 
initially agreed to registration, but then backed away, 
presumably because of pressure from the Chinese government. 
 
Other Challenges 
---------------- 
 
¶9.  (SBU) The GON, despite its reliance on foreign aid, 
remains sensitive to international "interference" as threats 
to Nepal's sovereignty, particularly from India, China, and 
the U.S.  Political squabbling and inefficient bureaucracy 
hinder movement at all levels; the Letter of Agreement for 
law enforcement assistance took ten months of at times 
 
KATHMANDU 00000105  003 OF 003 
 
 
contentious talks to finalize.  Further complicating progress 
towards peace are load-shedding -- scheduled blackouts that 
reached a peak of 16 hours per day in January -- and 
"bandhs," the preferred method of protest that force the 
closure of the capital city, major highways, and border 
region on a regular basis.  The GON has yet seriously to 
tackle either issue. 
 
Conclusion 
---------- 
 
¶10.  (SBU) You may wish to stress to the government and 
political leaders you meet that the United States fully 
supports Nepal's transition to a peaceful, democratic state. 
You may further choose to emphasize that while the U.S. is 
encouraged by developments with the CA committees, the 
selection of a date for by-elections, and the signing of the 
recent Letter of Agreement, we are disappointed that the pace 
and progress of furthering Nepal's fragile peace process has 
been so slow. 
BERRY