KATHMANDU VALLEY STRIKE OBSERVED; MAOISTS CLAIM

UNCLAS SECTION 01 OF 02 KATHMANDU 002052

SIPDIS

SENSITIVE

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

E.O. 12958: N/A
TAGS: PTER ASEC PGOV CASC NP
SUBJECT: KATHMANDU VALLEY STRIKE OBSERVED; MAOISTS CLAIM
DOOR OPEN FOR TALKS

REF: A. (A) KATHMANDU 2038


B. (B) KATHMANDU 2035

--------------
SUMMARY
--------------


1. (SBU) Four people were slightly injured in a series of
small explosions in the heart of Kathmandu--including two in
or near the Thamel tourist district--October 27. The
Maoists' October 28 strike in the Kathmandu Valley and
October 27 strike in the southern Terai plains region
bordering India were largely observed by the general public.
At least 30 Maoists were reported killed when the Royal Nepal
Army (RNA) repulsed a Maoist attack on a small airport in the
remote northeastern district of Okhaldhunga October 27. An
October 24 press statement from the Maoist Central Committee
reiterates the insurgent leadership's openness to talks and
calls on the King to create an environment conducive to
dialogue. End summary.

--------------
THAMEL TARGETED
--------------


2. (U) In an apparent effort to intimidate the local
population into observing the general strike, or "bandh,"
they had called for October 28 in Kathmandu Valley (Ref B),
suspected Maoists set off a series of small bombs within the
space of a few hours October 27 in heavily traveled areas of
Kathmandu--including, for the first time, the tourist
district of Thamel. Although a mid-afternoon bomb placed in
a bathroom near a popular pizza restaurant in Thamel blew out
the walls of the restroom and some windows of adjoining
shops, no injuries were reported. A bomb in the parking lot
of a crowded movie theatre (the only English-language cinema
in town) a few blocks from Thamel near the Royal Palace
injured one Nepali, while a third explosion at a dairy near
the Indian and British Embassies injured three. No injuries
were reported in a fourth explosion in the historic city of
Bhaktapur.

--------------
VALLEY, TERAI STRIKES OBSERVED
--------------


3. (U) The October 28 strike called by the Maoists for the
Kathmandu Valley appears to have been generally observed
within the city, with about 65 percent of shops and
businesses remaining closed for the day. Commercial and
private vehicular traffic was minimal throughout the day,
with only the occasional government- or diplomatic-plated
vehicle speeding past processions of bicycles and rickshaws.
Both Lincoln International School, which is attended by most
dependent children at the Embassy and the USAID Mission, and
the British School were closed for the day. An October 27
bandh called for the southern plain region (known as the
Terai) bordering India was apparently best observed in
outlying districts, while business in the larger (and better
defended) cities of Hetauda and Nepalgunj seemed less
affected. Sources in the Nepal Sadbhavana Party, whose
stronghold is in the Terai, told us urban areas of
Nawalaparasi, Rautahat and Rupandehi Districts were deserted,
with shops closed and no vehicular movement. An NGO source
told us almost all shops were open in Nepalgunj (home of the
RNA's First Division),however, and motorcycles (but no
private cars or jeeps) were plying the streets, although
long-distance buses had apparently suspended operations for
the day. A businessman in the industrial town of Hetauda in
Makwanpur District offered the most encouraging report,
telling us that all the shops were open and traffic normal
October 27.

--------------
OKHALDHUNGA ATTACK
--------------


4. (SBU) A large force of Maoists attacked a combined
police/RNA post guarding an airport in Okhaldhunga District,
180 miles northeast of Kathmandu, at about 10:30 p.m. local
time October 27. According to an RNA source, the security
forces succeeded in repulsing the attack, which ended by
about 2:30 a.m. October 28. The Maoists, who suffered at
least 32 confirmed casualties, did not succeed in penetrating
the perimeter. Two RNA soldiers, including the platoon
commander, a captain, were killed in the attack. Chief of
Army Staff Gen. Pyar Jung Thapa reportedly visited the site
and inspected RNA defenses there the previous week.

--------------
MORE PARTY PROPAGANDA ON PEACE TALKS
--------------


5. (U) A press statement from the Maoist Central Committee,
dated October 24, claims that the party "has kept the door
for peace talks and negotiation open." The "grave situation"
of the country presents two options. Either the King must
"demonstrate the kind of sacrifice that could ultimately
benefit the nation and the people" by accepting the election
of a constituent assembly, with the aim of drafting a new
constitution. On the other hand, "if the King, instead of
leading the nation toward national unity and people's
sovereignty, tries to suppress people by deploying the Royal
Nepal Army and an international army . . . then there is no
alternative before the people but to go ahead with the
historic struggle. . . . Here we would like to make clear
that our party is ready for both options." If the King
prefers to seek dialogue, the statement puts the burden on
him to offer a proposal for a "conducive atmosphere."

--------------
COMMENT
--------------


6. (SBU) Up to now, the Maoists, despite their fiery
anti-foreign rhetoric, have generally not targeted
tourist-frequented areas in their campaign. Even though no
one was hurt in the October 27 bombing in Thamel and just one
person slightly injured in the cinema parking lot bombing the
same day, the message was clear. The Maoists clearly have
the capability to harm foreigners. In this context, the
Maoists' injunction to the King to create a "conducive
atmosphere" for dialogue takes on a significantly more
threatening tone---and throws into even greater uncertainty
the insurgents' sincerity in calling for talks. In view of
this unsettling new note, the EAC has reviewed the Embassy's
security posture and determined that it is appropriate. We
will continue to monitor the security situation with and
inform the Department of any significant developments.
MALINOWSKI