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03KATHMANDU170 2003-01-29 11:00:00 SECRET//NOFORN Embassy Kathmandu
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					  S E C R E T SECTION 01 OF 02 KATHMANDU 000170 




E.O. 12958: DECL: 01/29/2008


B. B. 2001 KATHMANDU 2463

C. C. STATE 16536

Classified By: Ambassador Michael E. Malinowski for reasons 1.5 (b) and


1. (C) On January 28, Foreign Minister Narendra Bikram Shah
briefed the Ambassador on his January 23-26 trip to Bhutan.
Shah revealed a timeline for the Twelfth and Thirteenth
bilateral Ministerial Meetings to restart the work of the
Joint Verification Team to repatriate Bhutanese refugees.
Bhutan's King Wangchuck appears to be personnally engaged in
establishing a compromise with Nepal to break through the
impasse. The Government of Nepal (GoN) is cautiously
optimistic but will grade the Government of Bhutan's (GoB)
sincerity on the number of refugees it is willing to
repatriate. End summary.

Bhutan's King is Engaged

2. (S/NF) In a late afternoon meeting with the Ambassador on
January 28, Foreign Minister Narendra Bikram Shah briefly
outlined the results of his trip to Bhutan (Ref A). During
his trip, which was intended as an informal visit, Shah met
with Bhutan's Foreign Minister Thinley, Prime Minister Dorji,
and King Wangchuck in a setting where the King did most of
the talking. According to Shah's account, the King walked
line-by-line through Bhutan's position paper to clarify the
intent of his government in resolving the impasse:

-- Category 1, Forcibly Evicted Refugees: The King affirmed
GoB's previous commitment to accept the return of these
refugees and acknowledges its responsibility for their

-- Category 2, Voluntary Refugees: The King told Shah that
under Bhutanese law, these individuals lost their citizenship
upon their departure from the Kingdom. However, with great
objection from his Cabinet, the King will direct that the GoB
liberally interpret the citizenship law. In making this
concession, the King appealed to Shah for a reciprocal
commitment from the Government of Nepal--i.e., refugees in
this category will be asked to make a voluntary application
for citizenship to return to Bhutan, those individuals
unwilling to do so should be accepted by Nepal. (Comment: As
descrbied by Shah, it is unclear if acceptance by Nepal
equates to citizenship or a form of immigration parole within
Nepal. End comment.)

-- Categories 3, Criminals, and 4, Non-Bhutanese: According
to Shah, the King believes these two categories are much more
difficult. Criminals assessed to be Bhutanese will be
allowed to return, as long as they are willing to face
charges in Bhutan. However, the King stated that many
Category 4 refugees are really Indians seeking benefits.

Cautious Optimism: Many a Slip Between a Cup and a Lip
============================================= =========

3. (S/NF) During their meeting, Shah and the Bhutanese King
committed to holding the long-delayed Twelfth Round of
ministerial-level talks in Kathmandu on February 14, the eve
of the donor roundtable meeting in Geneva. Shah did not
provide any details of the meeting's agenda. He did,
however, reveal that a Joint Verification Team would assemble
in Bhutan upon the Round's conclusion to sort through the
paperwork from the first verification exercise completed at
the Khundunabari refugee camp in December 2001 (Ref B).
Nepal's delegation would be led by the Home Ministry and
accompanied by the Director General of Immigration.
According to Shah, Bhutanese commitment must be demonstrated
in Bhutan's acceptance of Category 2 refugees in large
numbers. A Thirteenth Round is tentatively scheduled for
March, where any outstanding difficulties from the Joint
Verification Team can be addressed, plans can be made for
emptying the Khundunabari camp, and a timeline and procedures
can be established to empty the remaining camps.

Foreign Minister, "Let Our Two Countires Settle this Dispute"
============================================= ================

4. (C) Shah emphasized the GoN and GoB desire to settle the
refugees bilaterally. He is aware of the assistance offered
by third parties to help, but asks, "let our two countries
settle this dispute." Shah was surprised and encouraged by
King Wangchuck's personal engagement on this issue. However,
his optimism is tempered by the repeated delays in the
repatriation process.


5. (S/NF) The change in tone from the GoB may augur a
bilateral breakthrough. However, Shah's caution is well
founded, with the GoN linking future talks upon the progress
of the Joint Verification Teams. Further, his appeal to
resolve the situation bilaterally may be interpreted as a
request to play down U.S. offers of third-country settlement.
The GoN might have concerns that offers of third-country
settlement could mitigate GoB's voluntary repatriation offer
for Category 2 refugees, as they may defer returning in light
of greater economic opportunities in the U.S. or elsewhere.
We believe it important that donors attending the February 17
aid consortium meeting in Geneva be encouraged to press the
GoB to move ahead on resolving this long-standing issue (Ref