TIMBER! TOP BRANCHES OF FORESTRY MINISTRY FELLED

UNCLAS KATHMANDU 000520 SIPDIS SENSITIVE STATE FOR SA/INS LONDON FOR RIEGEL E.O. 12958: N/A TAGS: PGOV SENV NP SUBJECT: TIMBER! TOP BRANCHES OF FORESTRY MINISTRY FELLED IN CORRUPTION SCANDAL REF: A. REF A) KATHMANDU 0485 ¶B. REF B) 01 KATHMANDU 2092 ¶1. (SBU) Summary: On March 11 Minister for Forest and Soil Conservation Gopal Man Shrestha and Minister of State for Forest and Soil Conservation Surendra Hamal resigned from their posts after trading charges of corruption and abuse of power. The resignations come less than ten days after Prime Minister Sher Bahadur Deuba announced the formation of a special judicial commission to probe corruption (Ref A). Most observers tote up the resignations to mutual personal and political enmity, rather than to any new initiatives to rid the Government of corruption. End summary. ¶2. (U) On March 11 Minister for Forest and Soil Conservation Gopal Man Shrestha and Minister of State for Forest and Soil Conservation Surendra Hamal resigned from their posts after trading mutual charges of corruption and abuse of power. In tendering their resignations within hours of one another, each publicly maintained his own innocence, while asserting the guilt of the other. ¶3. (U) The short-lived but highly visible scandal erupted March 8 after State Minister Hamal petitioned the Supreme Court to halt an investigation, initiated by the Commission for the Investigation of the Abuse of Authority (CIAA),of personnel transfers he had authorized. Hamal's petition accused CIAA Commissioner Krishna Kafle and Forestry Secretary Chandi Prasad Shrestha of conspiring against him. SIPDIS In a press conference later that day, Hamal accused Forestry Minister Gopal Man Shrestha--whose complaint had prompted the CIAA probe of Hamal's personnel appointments--of accepting bribes from a turpentine company in return for increasing its resin collection permit. Minister Shrestha publicly refuted his state minister's charges and counter-accused him of trying to arrange illegal transfers for selected employees within the Ministry. ¶4. (SBU) Several sources within the ruling Nepali Congress Party attributed the scandal to the substantial personal and political enmity between the two men, who hail from rival factions of the party. (Note: In an attempt to build broader support within his fractured party, PM Deuba expanded his Cabinet on October 18 to offer deputy ministerial posts to MPs aligned with his rival, former PM G.P. Koirala. End note.) According to one source, Minister Shrestha and his deputy locked horns over the dispensation of patronage--such as the allocation of plum assignments--within the Ministry. More than one party source noted that such tussles are commonplace within ministries, but are usually kept quiet as "internal" matters. When Shrestha and Hamal both went public in their accusations, however, these sources emphasize, they violated party discipline, forcing the PM to ask for their resignations. ¶5. (SBU) Comment: We find it instructive that Nepali Congress sources close to the PM identify violation of party discipline--and the public embarrassment it caused the Government--rather than the acts of alleged corruption themselves as the real reason Deuba asked for the resignations. These resignations came less than 10 days after Prime Minister Deuba, in an apparent effort to appease Opposition criticism of his administration's failure to prosecute corruption, annnounced the formation of yet another special commission to investigate corruption (Ref A). That two members of his own Cabinet should almost immediately thereafter engage in highly public and acrimonious recriminations must have been acutely embarrassing for Deuba and left him little choice but to ask for their resignations. Whether these resignations indicate a tougher stance toward corruption--and perhaps a more thorough Cabinet-cleaning exercise--from the PM in the future remains in doubt. MALINOWSKI