BOMB BLAST MARS LAPSE OF EMERGENCY IN NEPAL

UNCLAS SECTION 01 OF 02 KATHMANDU 001674

SIPDIS

SENSITIVE

STATE FOR SA/INS AND DS/OP/NEA
STATE PLEASE ALSO PASS USAID - DCHA/OFDA
LONDON FOR POL - RIEDEL
MANILA FOR USAID - DCHA/OFDA

E.O. 12958: N/A
TAGS: PTER PGOV ASEC CASC NP
SUBJECT: BOMB BLAST MARS LAPSE OF EMERGENCY IN NEPAL

REF: A. (A) KATHMANDU 1640


B. (B) KATHMANDU 1373

C. (C) KATHMANDU 1255

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SUMMARY
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1. (SBU) A mid-morning bomb blast in the heart of
Kathmandu's commercial center marred the August 28 lapse of
the state of national emergency. One person was injured in
the blast, which is believed to have been set by Maoist
insurgents. The explosion marked the second bombing in
Kathmandu in three days. We expect that Prime Minister Deuba
will push for re-imposition of the emergency, which has been
in virtually continuous operation for the past nine months,
upon his return from Europe at the end of the week. End
summary.

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ONE INJURED IN MORNING BLAST
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2. (U) One person suffered minor injuries in an explosion on
the third floor of a busy shopping center in downtown
Kathmandu at 11:00 a.m. local time August 28. The explosion,
which occurred in a hallway near a branch of the state-owned
Rastriya Banijya Bank, shattered glass but otherwise caused
no major damage to the office or surrounding shops. The
blast took place on New Road, a popular and congested
commercial district about 4 km from the Embassy.


3. (SBU) Local police, who report receiving a series of
telephone calls warning of similar explosions in the
vicinity, are conducting searches throughout the area but
have so far located no other devices. Authorities suspect
the blast was set by Maoist insurgents, who had earlier
declared August 27 the official start of an agitation
campaign leading up to a national strike, or "bandh," they
have called for September 16 (Ref B). (Note: Shopowners in
the building targeted by the bombing had orgainzed a car
rally in defiance of the Maoists' five-day bandh last April.
End note.) The blast coincides with the lapse of the state
of national emergency, which had been in virtually continuous
operation since its imposition by the Government November 26.


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TWO DEAD IN APPARENT ACCIDENTAL BLAST
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4. (U) Two men were killed in a bomb blast at a rooming
house in Kathmandu the night of August 26. The explosion,
which took place in a residential area about 6 km from the
Embassy, apparently occurred when the victims, subsequently
identified as suspected Maoists, were attempting to assemble
the device in the room. There is some speculation that a
nearby Army facility housing armored Ferret cars might have
been the prospective target. No Army property was damaged in
the blast. Police have made two arrests in the case. On the
same day suspected Maoist gunmen killed a policeman during a
bank robbery in Nepal's southern plains that netted them
nearly USD 1 million.

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EMERGENCY: TO EXTEND OR NOT EXTEND?
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5. (SBU) The state of emergency, which lapsed at midnight
August 27, can be extended for another three months by royal
ordinance at the request of Prime Minister Sher Bahadur
Deuba, now on an official visit to the EU in Brussels. Most
observers expect the emergency, which suspends a number of
key civil rights, including the rights to assembly and free
press, to be reinstated upon his return to Kathmandu, either
August 31 or September 1. Deuba has stated both privately
and publicly--most recently to reporters in Brussels--that
the state of emergency will be lifted prior to November 13
national elections. Many Western donors, including some EU
member states, have questioned whether their governments will
provide election assistance requested by the Nepali
Government if the state of emergency remains in effect during
polling.


6. (SBU) The expiration of the emergency had no immediate
visible effect on the streets of Kathamandu, where armed
soldiers continue to patrol major thoroughfares. Many
Opposition politicians have spoken out against extension of
the emergency, arguing that existing anti-terrorism laws
offer the security forces and the Government ample latitude
to apprehend and prosecute suspected insurgents (Ref C).

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COMMENT
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7. (SBU) This morning's bomb blast is fairly typical of
Maoist "gearing-up" activities before previous general
strikes. Similar incidents may follow in the days leading up
to the September 16 bandh. Opposition protests
notwithstanding, the explosion, coupled with the bank heist
and fatal bomb blast two days earlier, make extension of the
emergency for at least the next two months all but a foregone
conclusion. Whether or not Deuba will be able to keep to his
oft-repeated pledge to lift the emergency before elections
remains to be seen.
MALINOWSKI