UPDATE ON NEPAL'S MAOIST INSURGENCY, May 17-23

UNCLAS SECTION 01 OF 03 KATHMANDU 000960

SIPDIS

STATE FOR SA/INS AND DS/IP/NEA
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FINANCING
JUSTICE FOR OFFICE OF THE DEPUTY ATTORNEY GENERAL/DLAUFMAN

E.O. 12958: N/A
TAGS: PINS PTER CASC PGOV NP
SUBJECT: UPDATE ON NEPAL'S MAOIST INSURGENCY, May 17-23

REFERENCE (A) KATHMANDU 0902

(B) KATHMANDU 0945
(C) KATHMANDU 0140
SUMMARY
--------------


1. No date has been set yet for the third round of peace
talks. However, the controversy continues around
restrictions on the movements of the Royal Nepal Army (RNA).
Maoist leaders have demanded explanations for the statements
made by Ramesh Nath Pandey, Minister for Information and
Communication and government negotiating team member,
denying that any agreement has been reached about limiting
the RNA. The release of three Maoist Central Committee
Members has been delayed. The RNA continues its
humanitarian assistance and medical treatment outreach
efforts. Amnesty International (AI) announced on May 19
that it intends to send a delegation to Nepal. The All
Nepal National Independent Students' Union-Revolutionary
(ANNISU) has forced the closure of accounting offices in
over twenty-four private schools. A Maoist Central
Committee Member admitted in a local interview that fear of
the U.S. military drove the Maoists to the negotiating
table. Maoists abducted fifteen civilians, tortured four
others, and continue to extort money. Victims of the Maoist
insurgency continue to voice their objections to being
excluded from the peace process. End Summary.

MAOISTS WANT PANDEY OUT
--------------


2. Baburam Bhattarai, Maoist ideologue and head of the
Maoist negotiating team, angrily reacted to statements by
Ramesh Nath Pandey, Minister for Information and
Communication and government negotiating team member, in
which Pandey said that no agreement was reached regarding
the restriction of the Royal Nepal Army's (RNA's) movements
to only five kilometers from their barracks (Ref A).
Bhattarai, speaking at a hastily called press conference on
May 15, said Pandey's denial of the agreement was a "blatant
lie" and a betrayal of the peace process. The Maoist
ideologue reiterated his claim that the agreement to
restrict the RNA's movements was reached during the second
round of peace talks, and said the government should get rid
of the "liars" on its team. In addition to the demand for a
new "trustworthy and powerful (government) team," Bhattarai
said that the Maoists want clarification of Pandey's
statements, an immediate halt to international intervention
and "dubious" activities, the immediate release of their
three Central Committee Members, and a halt to public
comments by the army.


3. Narayan Singh Pun, Minister of Physical Planning and
Works and government negotiating team member, in response to
Bhattarai's complaints against Pandey, said that there had
been some "misunderstandings" between the government and the
Maoists, but told reporters that the Maoists were right
about the agreement made to restrict the army. In direct
contrast to Pun's statement, however, Badri Narayan Basnet,
Minister for Forest and Soil Conservation, reportedly
concurred with Pandey and said that no agreement had been
reached. To date, the RNA has continued normal operations.

MAOISTS FEAR U.S. MILITARY
--------------


4. During an interview with a local publication in May,
Matrika Prasad Yadav, a Maoist Politburo member and
negotiating team member, conceded that the fear of American
intervention prompted the Maoists to return to the
negotiating table. Yadav reportedly said that the growing
influence of the United States remains a concern to the
Maoists. The insurgents have enjoyed many victories over
GON security forces, Yadav claimed, but conceded that the
Maoists are not ready to take on American forces and will
remain at the negotiating table as long as necessary to
forestall more direct U.S. military involvement.

RELEASE OF MAOIST LEADERS DELAYED
--------------


5. Despite reported government assurances that the Maoists'
three Central Committee Members would be released, the GON
instead filed a detention order, extending the prison
sentence another six months for one of them. Krishna
Bahadur Mahara, Maoist spokesman, issued a press release on
May 21 criticizing the move, and declared the Maoists were
taking this action "very seriously." Mahara questioned the
GON's motives in extending the jail sentence and accused the
GON of violating the code of conduct.

MAOIST VIOLATIONS INCREASE
--------------


6. Maoist cadres have continued to violate the ceasefire
agreement by abducting civilians in three separate
southeastern districts. Two civilians were abducted from
Siraha District on May 20, while on May 19, nine family
members were abducted by insurgents in Dhanusha District.
The family members reportedly are members of the Nepali
Congress (NC) party, and had refused to contribute to the
Maoists. The insurgents also reportedly accused them of
being informants. Their whereabouts remain unknown.
Maoists also abducted three former members of local Village
Development Committees (VDCs) in Sindhuli District, and
another Nepali Congress supporter from Morang District, who
remains missing. Four civilians, including a woman, were
tortured by Maoists in the northern district of Gorkha after
the insurgents were given tap water to drink instead of
filtered water.


7. Maoists reportedly have continued extorting money from
tourists in the northeastern region of Dolakha, demanding
"donations" from as many as seven tourist groups in a week.
According to press reports, the Maoist leaders in the region
have admitted the practice, declaring that the money will be
used for "development purposes," and therefore is not a
violation of the code of conduct. In the mid-western
district of Rolpa, the insurgents reportedly have also been
issuing trading licenses to local merchants. Merchants are
forced to give a "voluntary donation" in order to receive
permission to sell their goods. The Rolpa Chief District
Officer (CDO) was quoted as saying that the Maoists are in
direct violation of the code of conduct, and that the
activities should stop immediately.

RNA CONTINUES HEALTH CAMPS
--------------


8. The Royal Nepal Army (RNA) conducted free health camps
across Nepal, providing dental care, medical treatment, and
various humanitarian services (Ref B). According to press
reports, Army personnel provided assistance to almost four
thousand villagers in the districts of Surkhet, Siraha,
Bharatpur, Itahari, Sindhuli, Dolakha, and Udayapur. The
army also distributed supplies to elementary schools in
Udayapar District, and repaired desks and benches in the
schools. In Bharatpur, a blood drive was also held.

AI TO SEND DELEGATION TO NEPAL
--------------


9. Amnesty International (AI) announced on May 19 that it
will send a delegation to Nepal to discuss its concern over
increasing human rights violations by both the security
forces and the insurgents, despite a three-month ceasefire.
In its press release, AI urged the Maoists and the GON to
establish immediately an effective monitoring team, and
provide the necessary resources to conduct impartial
investigations of alleged human rights violations.

ANNISU-R THREATENS TO CLOSE PRIVATE SCHOOLS
--------------


10. The All Nepal National Independent Students' Union-
Revolutionary (ANNISU) has forced the closure of accounting
offices in over twenty-four schools. The Maoist aligned
student group said the offices would be closed indefinitely.
The disruption in services and continued threats from
members of ANNISU-R has caused some private schools to
consider closing permanently, and has stirred the anger of
parents, many of whom are pleading with school principals to
keep the schools open. ANNISU-R has demanded that tuition
fees be lowered, and locked the accounting offices in
protest.

MAOIST VICTIMS DEMAND JUSTICE
--------------


11. Victims of the Maoist insurgency complain that they
remain without a voice in the peace process. The daughter
of Mohan Krishna Shrestha, the Inspector General of the
Armed Police Force, who was brutally murdered along with his
wife and bodyguard (Ref C),told a local publication on May
16 that the GON should not have released those responsible
for her parents' murder. Shrestha said the murders have
been forgotten under the pretext of not disturbing the peace
process. Victims' groups have been persistent in trying to
get their needs on the agenda, but Minister Pun acknowledged
that the issue of civilian killings has not yet "figured
into the peace negotiations."

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