C O N F I D E N T I A L SECTION 01 OF 03 KATHMANDU 002091

SIPDIS

STATE FOR SA/INS
LONDON FOR POL - RIEDEL

E.O. 12958: DECL: 10/31/2012
TAGS: PGOV NP
SUBJECT: TO JOIN OR NOT TO JOIN: THE NEPALI PARTIES'
DILEMMA

REF: (A) KATHMANDU 2025

Classified By: DCM ROBERT K. BOGGS. REASON: 1.5 (B,D).

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SUMMARY
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1. (C) King Gyanendra's dismissal of the government of
former Prime Minister Sher Bahadur Deuba and appointment of
an interim government have spotlighted long-standing
tensions--and mutual suspicions--between the political
parties and the Palace. Conversations with leaders of the
two largest political parties reveal a deep-seated mistrust
of the King and his motives that interprets his action as
part of a carefully orchestrated plan to sideline and
undermine the parties. The Palace, for its part, has made
little effort so far to mask its disdain for the self-serving
political leaders. India reportedly is undertaking a
campaign to persuade Nepal's leading politicians to take part
in the interim government. Given India's influence in
Nepal's domestic politics, at least some of the
parties--perhaps the Communist Party of Nepal - United
Marxist Leninist (UML)--may take the bait. Unfortunately,
only the Maoists, with their well-known proclivity for
driving wedges among competing political interests, stand to
benefit from the ongoing polarization between the Palace and
the parties. End summary.

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PARTY/PALACE POLARITY
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2. (C) Since King Gyanendra's October 11 appointment of an
interim government under Prime Minister Lokendra Bahadur
Chand, the mainstream political parties have remained
pointedly aloof from the Cabinet. The stalemate is fueling a
growing polarity between the Palace and parties that could
undermine any efforts to re-establish dialogue with the
Maoists. When the King used his constitutional authority to
sack the government of former Prime Minister Sher Bahadur
Deuba October 4, he invited all of the mainstream political
parties to give him, within five days, nominations of members
to an interim Cabinet. One week later, when the parties
ostensibly failed to provide him the nominations within the
stipulated deadline, the King appointed his own candidate,
Lokendra Bahadur Chand, as caretaker Prime Minister, as well

as eight other members of an interim Cabinet. The
politicians immediately cried foul, with the leaders of the
two largest political parties, the Nepali Congress and the
Communist Party of Nepal - United Marxist Leninist (UML),
crying the loudest and longest. Despite PM Chand's overtures
to party leaders to nominate members to fill the remaining
seven vacant slots in his Cabinet, only the Nepal Sadbhavana
Party, whose Acting President Badri Prasad Mandal the King
made Deputy PM, has announced it is ready to take Chand up on
his offer. (We expect Chand's National Democratic Party,
a.k.a RPP, to make a similar announcement soon.)


3. (C) The Palace's version of events thus far is fairly
straightforward. The King, acting on a commitment to
multi-party democracy, invited the parties' participation in
the interim government, but the parties, recalcitrant and
fractious as usual, could not agree on a slate of names
within the stipulated time frame. The King's previously
stated commitment to multi-party democracy and holding
elections as early as possible, however, remains unchanged.
He has told us that he consulted constitutional experts
before undertaking his action, and is confident of its
constitutionality. The Chand government continues to seek
the parties' nominations for the rest of the Cabinet, as well
as their consensus on an early date for elections (Ref A).


4. (C) The two largest parties, however, tell a somewhat
different story. Conversations with Nepali Congress
President and former PM G.P. Koirala and UML leader Madhav
Nepal, as well as with other members of the Nepali Congress
and UML leadership, reveal a long-standing, deep-seated
mistrust of the Palace and its motives--with some even
intimating the current imbroglio is the outcome of a
carefully hatched plot by the King and his royalist cronies
to undermine democracy. They view the affable, ever-amenable
Chand as no more than a stooge to carry out the Palace's
bidding. Koirala and Nepal have each recounted events that
suggest the Palace misrepresented its intentions in private
consultations with the parties. According to both Koirala
and Nepal, in private audiences on or before October 11 the
King asked for their approval of Chand as PM. Both tell us
they gave their approval--or at least offered no
objection--with the understanding that the new PM would then
consult with the party leaders on nominations for the rest of
the Cabinet. That consultation would preserve "the spirit of
Clause 128" of the Constitution, in their view, which covered
the formation of the the first Cabinet under democracy.
Clause 128 stipulated that that first Cabinet consist of
'representatives of the main political parties" chosen on the
recommendation of the Prime Minister. Both tell us they went
away from their meetings with the belief that the King had
agreed to that arrangement--only to be surprised late October
11 by the announcement of eight other Cabinet members along
with Chand. (The Nepal Sadbhavana Party leadership did not
know its Acting President was to be join the Cabinet until
the announcement, according to the party's General Secretary.)


5. (C) Besides feeling they had been hoodwinked, Koirala
and Nepal cited an additional barrier to their parties'
participation in Chand's Cabinet. Both argue that the King
has never actually ceded to the new PM the executive power he
assumed after his October 4 dismissal of Deuba. (Koirala
said Chand had admitted as much to him, adding that the King,
rather than Chand, picked the rest of the Cabinet.) The lack
of executive authority makes Chand no more than "a titular
Prime Minister," Koirala told us, and his Cabinet a "puppet
government," in Nepal's view, which would be "suicidal" for
any self-respecting democratic party to join. A Prime
Minister should be accountable to the people first, rather
than to the Palace, Nepal noted. Under the current
situation, however, the reverse holds true, he asserted. "If
the government is only a tool (of the Palace), why should we
join?"


6. (C) Both Koirala and Nepal argue that the interim
government needs the political parties to gain popular
support. Koirala said he had advised the King to form a
Cabinet with political party members to give himself a buffer
between the vicissitudes of government and popular
discontent. The King violated the preamble of the
Constitution, which awards sovereignty to the people, when he
arrogated executive powers to himself, Koirala charged. Both
Nepal and Koirala said the King must "correct his mistakes"
by giving Chand the authority to reform his Cabinet in the
"spirit of Clause 128," i.e., in consultation with the
parties, if he truly wants to broaden partisan participation
in the caretaker government. The UML might take part in such
a reformed Cabinet; Koirala's Nepali Congress, he claims,
would stay out, but would not agitate against it.

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GYANENDRA: "AMBITIOUS" AND DECISIVE
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7. (C) Some observers who have met the King describe him as
shrewd, articulate, and far more decisive than his late
brother. One former Nepali ambassador to the UK who knew
Gyanendra years before he became King describes him as
"ambitious" and critical of his late brother's passivity
during the drive for democracy. Others, while stopping short
of criticizing the King himself, say they are uneasy because
of the close coterie of pro-monarchist advisors that surround
him. In private discussions (both with the Ambassador and as
reported by other interlocutors), the King has made no secret
of his impatience with the political parties, citing them for
corruption, self-interest, and ineffectuality in dealing with
the Maoists, points echoed by the Royal Nepal Army
leadership. Despite this antipathy, at least some of the
King's advisors agree that the new government needs
multiparty participation--both to afford the King political
cover and to make the government more credible to Nepalis and
to the international community. (No one, however, makes the
argument that including the parties will increase the
government's effectiveness or competence.) The King's
rigidity in setting conditions for participation in the
government has made it increasingly difficult for the parties
to accept his terms. We have heard reports that the Indian
government, through its Embassy in Kathmandu, will step up
efforts over the next few weeks to persuade political parties
to take part in the government. To make this work, the
Palace may have to back down from some of its previous
preconditions for Cabinet membership--perhaps scrapping the
prohibition against members contesting the next election.
(We have heard reports that the King may be willing to do
this.) In addition, the Indians may ask that the King make
clear that he has handed back executive power to the Prime
Minister.

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THE MAOISTS
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8. (C) But the mainstream parties and the Palace are only
part of the political equation. The Maoists, who seem to
thrive on the political factionalization endemic in Nepal,
must also be factored in. The insurgents have responded in
typically cryptic fashion to interim government overtures for
dialogue, neither categorically ruling them out nor accepting
them. Instead, they have called for the King, members of
political parties, and civil society to work together toward
"a conducive atmosphere" for dialogue--predicated on the
well-nigh impossible condition of the King first agreeing to
a constituent assembly to draft a new constitution. (Note:
In Maoist parlance, revision of the Constitution is shorthand
for severing the King's authority over the Army and other
changes that would provide a foothold for the
militants--including ultimate abolition of the monarchy--in
the Nepali power system. End note.) In the meantime, they
are keeping up their campaign of killing, extortion, and
strike-calling, confident that the stalemate between the
parties and the Palace will keep the heat off them.
Pratyoush Onta, a Nepali scholar, told us the Maoists are
masters of the art of obfuscation and "rhetorical confusion,"
never missing a chance to sow dissension among various
political forces and reap advantage from polarities that may
develop. Unfortunately, Onta says, the parties--and now,
apparently, the Palace as well--time and time again play into
the Maoists' hands, allowing themselves to be manipulated
into the insurgents' divide-and-conquer game.

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COMMENT
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9. (C) Mistrust of the Palace by political leaders like
G.P. Koirala and Madhav Nepal is an outgrowth of the years of
repression and personal hardship suffered in the struggle
leading to the restoration of democracy in 1990.
Unfortunately, the current King's firmness in dealing with
the parties--as well as his alleged disingenuousness in
revealing his intentions--have done little to dispel that
mistrust. The King may well have cause to be impatient with
the parties' penchant for bickering and preoccupation with
short-term political gain. But the King needs the parties'
participation--and their popular base, however battered--if
the interim government is to accomplish the many ambitious
tasks set for it, such as setting a date for elections and
initiating dialogue with the Maoists. Without the parties'
participation, the King's reassurances of his commitment to
multi-party democracy and early elections will begin to wear
thin. Presenting a united front before the Maoists,
moreover, has to be the first step in seeking dialogue with
the insurgents. Otherwise, the insurgents can later renege
on any agreement reached, claiming it did not have popular
support. Like it or not, the King must offer the parties
some face-saving concession--perhaps scrapping the
prohibition against Cabinet members contesting the election
and/or allowing Chand to restructure the Cabinet--if he truly
wants to obtain the multi-partisan, consensus government he
says he wants. The question then will be whether the party
leaders will rise above their narrow personal and partisan
interests and work together, under the King's leadership, for
the good of the nation and the restoration of full democracy.

MALINOWSKI