OUTCOME OF PEACE TALKS NOT YET CLEAR

C O N F I D E N T I A L KATHMANDU 002680 SIPDIS SIPDIS E.O. 12958: DECL: 10/10/2016 TAGS: PGOV PTER NP SUBJECT: OUTCOME OF PEACE TALKS NOT YET CLEAR Classified By: Charge d'Affaires Nicholas Dean. Reasons 1.4 (b/d) Summary -------------- ¶1. (C) With the second day of the staggered peace summit between the governing Seven-Party Alliance (SPA) and the Communist Party of Nepal (Maoist) (CPN-M) having drawn to a close, it is not yet clear where things stand. All the parties have agreed that constituent assembly elections should take place between mid-April and mid-June. Any deal, however, will depend on the SPA and Maoists reaching agreement on the biggest sticking point, Maoist arms management. The two sides are still far apart. The earliest possible date for the signing of a peace deal would be October 12 -- but a later date seems much more likely, if then. Peace Summit Starts Positively -------------- ¶2. (C) According to our contacts, the first day of the peace talks between the Government of Nepal (GON) and the Communist Party of Nepal (Maoist) (CPN-M),which took place on October 8 at Prime Minister Koirala's Residence in Kathmandu, was "positive." There was an almost festive atmosphere in the area around the PM's Residence. The leaders of each of the seven parties in the governing alliance (SPA) as well as Maoist supremo Prachanda had a chance to spell out their positions at length to the dozens of SPA and Maoist representatives present. It was agreed at that meeting, which lasted nine hours, that there would be one, single package deal on all the issues. The party leaders appointed eight representatives to forge a negotiating document for the party leaders to discuss at the next meeting. They then recessed the talks for a day, to resume October 10. Open Issues on Day One -------------- ¶3. (C) Center-right Nepali Congress - Democratic (NC-D) leader Minendra Rijal told Emboff October 9 that his party as well as the PM's center-right Nepali Congress had pushed hard in the first day of talks for the Maoists to be separated from their arms first. The two parties had insisted that no agreement could be struck on any of the other open issues until arms management was resolved. He also voiced concern that the center-left Communist Party of Nepal - United Marxist Leninist (CPN-UML) might be inclined to take a softer line with the CPN-M on this issue. Rijal also noted that the Maoists were thus far insisting they would only separate from their arms if the SPA agreed immediately to suspend the monarchy or if the Nepal Army were separated from a portion of its arms. The Maoists had indicated they would give up 50 percent of their weapons if the NA retired 20 percent of its weapons. Far left civil rights leader Padna Ratna Tuladhar, who is an official observer of the peace talks, told Emboff on October 9 that Prachanda had cited a recent incident as an argument for not waiting until the constituent assembly to decide on the monarchy. The Maoist supremo told the gathered negotiators that representatives of the King had recently offered him money not to suspend the monarchy. In other words, the King could not be trusted to remain quietly in his palace until constituent assembly elections could take place. Peace Summit Makes Progress On Day Two -------------- ¶3. (C) Although the peace talks were officially on recess on October 9, our contacts confirmed that Prime Minister Koirala and Prachanda met on the 9th for less than an hour. The talks officially resumed on October 10 at the PM's Residence and lasted approximately eight hours. No final agreement was reached but it was announced that a press conference would be held at 6 p.m. local time. The press conference will be televised. According to Embassy contacts in all three of the major SPA parties, however, the talks made progress on at least two issues: a date for constituent assembly elections and appointment of election commissioners. The elections are to be held between the middle of April and the middle of June ¶2007. The GON, presumably with the concurrenQ of the Maoists, is to appoint election commissioners within the month of October to begin preparation for the elections. The previous commissioners resigned in disgrace after the people's movement in April and have not yet been replaced. A senior NC leader, Chandra Bastola, told us the interim government would announce the election date once that government was constituted. Still No Deal On Arms Management -------------- ¶4. (C) Post contacts informed us October 10, however, that the SPA is holding to the line so far that there can be no deal on the elections until Maoist arms are dealt with. Bimal Niti, a senior NC-D leader, told Emboff that the Maoists have made three different proposals. One would be for all the parties to declare Nepal a democratic republic immediately. Under those circumstances, the CPN-M would go into cantonments and lay down all their arms. Under the second proposal, the King would stay in place until the constituent assembly could decide on his future, and the Maoists would join the interim government, but in that case, the Maoists would go into cantonments, but give up only 50 percent of their arms and only if the NA gave up 20 percent of theirs. The third proposal was that the Maoists not enter the interim parliament or the interim government, but in that case they would not give up any arms. Niti told Emboff that the SPA would have to respond to the CPN-M proposals at their next meeting. Comment -------------- ¶5. (C) Determining the final outcome of the peace talks is still too difficult to predict. The SPA and the Maoists are currently scheduled to resume negotiations on October 12. Whether they will make progress on the remaining issues, particularly arms management, remains to be seen. The earliest possible date for signing a peace accord would be the 12th, but we strongly suspect, and most of our contacts agree, that any deal -- if there is one at all -- will require at least a few more meetings. There is considerable momentum to this summit and a desire by all parties for peace, but we hope that the GON will stick to its guns, and we mean that literally. DEAN