PM DEUBA'S TRIP TO INDIA

C O N F I D E N T I A L SECTION 01 OF 02 KATHMANDU 000613 SIPDIS STATE FOR SA/INS E.O. 12958: DECL: 03/26/2012 TAGS: PREL PGOV PTER NP IN CH SUBJECT: PM DEUBA'S TRIP TO INDIA REF: A. (A) KATHMANDU 0575 ¶B. (B) KATHMANDU 0467 Classified By: POL/ECON MAHONEY. REASON: 1.5 (B,D). -------------- SUMMARY -------------- ¶1. (C) Ministry of Foreign Affairs meetings offering a read-out of Prime Minister Sher Bahadur Deuba's March 20-25 visit to India revealed no specifics of any assistance the Indians may have offered their smaller neighbor in its effort to contain a Maoist insurgency. Despite the apparent absence of tangible deliverables, the lengthy official visit--Deuba's first since assuming office last July--gives the PM's sagging domestic prestige a much-needed boost. End summary. -------------- SOLID SOIL ASSURANCES -------------- ¶2. (U) Poloff met with Ministry of Foreign Affairs Undersecretary Prahlad Prasai March 26 for a read-out of Prime Minister Sher Bahadur Deuba's March 20-25 visit to India--his first official visit to a foreign country since becoming PM last July (Ref A). The Ambassador also touched on the visit in a March 27 meeting with Foreign Secretary Madhu Raman Acharya. Prasai said the invitation from India had been a "long-standing" one and there was no particular siginificance to the timing. Deuba was accompanied by Commerce Minister Purna Bahadur Khadka; Water Resources Minister Bijaya Gachhedar; State Minister for Foreign Affairs Arjun Bahadur Singh; State Minister for Science and Technology Bhakta Bahadur Balayar; and Foreign Secretary Acharya. ¶3. (SBU) Prasai described the visit as touching on all aspects of the wide-ranging bilateral relationship, but highlighted what the Government of Nepal (GON) views as the chief deliverable: solid assurances from India that its "soil will not be used against Nepal" by terrorists or insurgents believed to slip back and forth across the border. Prasai acknowledged that Nepal had asked for--and received--similar assurances in the past, but stressed this time the GON "asked with emphasis." Poloff asked if the GON provided names of particular individuals believed to be on Indian territory; Prasai said the discussion was not that specific. He noted Deuba received the same pledge from the Chief Minister of West Bengal, where Nepali Maoist insurgents are believed to have links. The Indians also promised to beef up border security and made a reciprocal request that Nepali soil not be used against India, Prasai reported, specifically by Pakistani intelligence agents they believe operate in Nepal. In response to that request, Prasai related the GON gave its standard promise to act on any report of illegal activity in Nepal that the Government of India (GOI) furnishes. Joint Secretary Gyan Chandra Acharya told the Ambassador the Indians had said they would be able to do more against the Maoists once the Terrorism Bill passed Parliament. The GON now expects India may begin banning some organizations, such as the Maoists. -------------- PROMISES OF ASSISTANCE -------------- ¶4. (C) Prasai said Deuba also received general assurances that the GOI is "ready to give assistance" to Nepal in its effort to counter the Maoist insurgency. Deuba indicated that the GON would welcome "logistic" assistance--i.e., arms and equipment but not troops--from its neighbor, but made no specific formal request for such equipment. (Note: Prasai acknowledged equipment requests might have been discussed during the one-on-one meeting between the two PMs, but he said he could not be certain. End note.) Deuba had to emphasize in the local press that he made no request for foreign troops in order to appease his domestic audience, Prasai noted. In fact, the MFA official said, the subject of Indian troops assisting Nepal was never contemplated and did not come up during the visit. Joint Secretary Acharya noted to the Ambassador Nepal's delicate geographical position between two large neighbors, which necessarily raises regional sensitivities about Nepal soliciting or receiving military assistance from foreign donors. Nonetheless, he added, during the visit the Indians emphasized their own interest in seeing the situation in Nepal stabilize. The Nepalis had in turn stressed that they were seeking only "support"--not help in fighting the insurgency--from other donors like the U.S. and the U.K. -------------- TRADE AND TAXES -------------- ¶5. (SBU) Deuba asked that a four-percent tax on Nepali imports, imposed by some state governments in excess of duties stipulated by the re-negotiated bilateral trade treaty (Ref B),be lifted. The GOI undertook to review the matter, Prasai said. The long-pending completion of a rail link between the Nepali border city of Birgunj and the Indian city of Raxaul was also raised, Prasai reported, noting that only one km of rail line on the Indian side is left. The completion of the rail line and the accompanying Inland Container Depot, or "dry port," at Birgunj will cut down the substantial storage costs in India that Nepal now incurs on third-country imports shipped via Calcutta. -------------- DAMS AND DEMARCATION -------------- ¶6. (SBU) Also significant for Nepal, said Prasai, was India's commitment to "find a solution before the next monsoon" season to flooding in the two southern districts of Rupandehi and Banke that Nepal claims is caused by Indian embankments. (Note: The Indians had earlier temporarily suspended construction of the embankments after GON complaints last year; there is some suspicion construction has since resumed. End note.) The Indians also committed to finish a long-pending project report on a joint hydroelectric project in western Nepal by June. The two governments also agreed to hold bilateral consultations on boundary demarcation, especially the disputed territory at Kalopani in the far west where India has stationed troops since 1962, Prasai said. -------------- CONSULATE FOR INDIA? -------------- ¶7. (C) Prasai reported the Indians also raised a previous request to establish a consulate on the border in Birgunj. He said the GON is reluctant to grant the request, since the Chinese would then press for progress on their outstanding request to set up a consulate in Biratnagar on Nepal's southeastern border with India. When poloff queried why the Chinese would want a consulate so far from their own border with Nepal, Prasai responded that the official reason is trade--and then speculated that a likelier reason is to keep an eye on the Indians. -------------- COMMENT -------------- ¶8. (C) The GON has long suspected that Maoists find quick and easy shelter across the border, and has asked for--and received--on previous occasions Indian assurances of assistance in blocking that access. Despite extensive official press coverage billing the visit a grand success, it isn't clear what specific deliverables--outside of these same general assurances of support--Deuba managed to bring back. That said, for a PM who faces a violent insurgency in his own country and increasingly internecine politicking in his own party any message of support, no matter how generic, may be welcome. End comment. MALINOWSKI