PEACE DEAL APPEARS UNLIKELY ON EVE OF THIRD DAY OF

C O N F I D E N T I A L KATHMANDU 002700

SIPDIS

SIPDIS

E.O. 12958: DECL: 10/12/2016
TAGS: PGOV PTER NP
SUBJECT: PEACE DEAL APPEARS UNLIKELY ON EVE OF THIRD DAY OF
TALKS

REF: KATHMANDU 2680

Classified By: Charge d'Affaires Nicholas Dean. Reasons 1.4 (b/d).

Summary
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1. (C) USAID contracted peace facilitator Siebert and leaders
of two of the three major political parties in the Government
of Nepal (GON) told the Charge d'Affaires and visiting SCA
India, Nepal, Sri Lanka Office Director Bernicat in separate
meetings on October 11 that they did not expect the GON and
the Maoists to reach a peace deal on October 12. Siebert
said the two sides were still divided on the role of the
monarchy, the composition of the interim legislature (and the
interim government),and arms management. They were divided
as well over the electoral process, citizenship rights and
the country's federal structure, but the latter matters were
not intractable. If no progress could be made on the first
set of issues on the 12th, Siebert anticipated progress on
the second set of issues. According to four senior
politicians from the center-right Nepali Congress Party (NC)
and the center-right Nepali Congress - Democratic (NC-D),it
would take more time for all the open issues to be resolved.
Although all of the politicians expressed their concern about
ongoing Maoist threats, violence and extortion, they did not
challenge the GON's policy of ignoring Maoist abuses until
Maoist combatants go into cantonments. Siebert's colleague
Olivier also briefed Charge and Bernicat on the status of
planned peace councils and the difficulties they would face.

Status of the Talks
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2. (C) In a meeting on October 11, the eve of the third day
of peace talks between the Government of Nepal (GON) and the
Communist Party of Nepal (Maoist) (CPN-M),Hannes Siebert,
South African USAID-contracted peace facilitator who is
working closely with GON peace negotiators, briefed on the
peace talks. Siebert told the Charge d'Affaires and Marcia
Bernicat, Director of the India, Nepal, Sri Lanka, Bhutan and
Maldives (INS) Office in the Bureau of South and Central
Asian Affairs (SCA),that he did not expect a final deal
would be reached on October 12. There were too many open
issues. He said the announcement on October 10 by chief
negotiators on both sides that constituent elections would be
held by mid-June 2007 had represented an important symbolic
step. The peace facilitator spoke of the two sides'
"extraordinary willingness" to reach an agreement. Siebert,
who has been involved in Nepal's peace process since 2004,
indicated he was personally encouraged that progress would
continue. What was not resolved on the 12th would be picked
up again on the next day of talks, perhaps on the 15th.

Hard Issues
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3. (C) One of the major stumbling blocks to a peace accord,
Siebert stated, was the future of the monarchy. Another was
the composition of the interim parliament and the interim
government. The peace facilitator described the situation
with the legislature as a "nightmare." Every politician in
the country seemed to want to become a member of the interim
parliament. Siebert confirmed as well what we had heard about
three Maoist proposals on the thorny issue of Maoist arms
management: (1) in return for immediate declaration of a
republic, Maoists would give up all arms; (2) in return for
25-30 percent of the Nepal Army's (NA's) weapons going under
seal, the Maoists would separate from 50 percent of their
weapons; and (3) the Maoists would go into cantonments but
not separate from any of their weapons; in that case, they
also would not expect a seat in the interim government or
parliament (reftel).

Large Parliament Likely
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4. (C) In a separate meeting the evening of October 11, Arjun
Narsingh KC of the Nepali Congress (NC) and Minendra Rijal of
the Nepali Congress (Democratic) (NC-D) told Emboff they

agreed that a 300-person interim parliament made no sense.
Many of the MPs in the restored Parliament who would form the
bulk of the membership of the interim parliament had played
absolutely no role, they said, in the restoration of
democracy in April. They were resigned, however, to a large
interim parliament legislature. Rijal did voice concern that
the center-left and left parties would end up with more seats
in the parliament than the center-right parties -- NC, NC-D
and its minor party allies. On the interim government,
Siebert had previously told the Charge and the SCA/INS
Director that one formula under discussion proposed to give
the NC four ministers, the Communist Party of Nepal - United
Marxist Leninist (CPN-UML) four ministers and the Maoists
four ministers, with much smaller numbers for the other
parties. Allocation of portfolios had not been discussed.

Arms Management Still Unresolved
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5. (C) Rijal also told Emboff that if the parties had been
prepared to accept one of the three proposals that the
Maoists put on the table, they would have done so on the
10th. What was obvious, Rijal said, was that the CPN-M
wanted to position itself in the public eye as having acted
reasonably, in the event it chose to leave the talks. It
could claim it offered the Seven-Party Alliance (SPA) three
options, and they accepted none of them. It also allowed the
Maoists to play on public sentiment against the monarchy and
made the SPA appear to be protecting the King. It was
extremely unhelpful, Rijal and Narsingh complained, as did
Chakra Prasad Bastola of the NC, that CPN-UML General
Secretary Madav Nepal was trying to copy the Maoist populist

SIPDIS
supposed peace-loving strategy inside the talks. They told
the Charge and Ms. Bernicat that the CPN-UML leader did so,
knowing full well the danger of allowing the Maoists to keep
their arms, but guessing, correctly, that PM Koirala of the
NC and President Deuba of the NC-D would not allow the CPN-M
at the end of the day to retain them. It would take at least
several more sessions, Bastola speculated, to resolve the
issue of arms management.

Other Issues Easier
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6. (C) There were divisions as well over the electoral
process, citizenship rights and the country's federal
structure, Siebert had said, but he did not think these
issues were intractable. The two sides were actually very
close to agreement on them on October 10. He ventured that
if no progress could be made on the first set of issues on
the 12th, the GON and the Maoists might make an announcement
on one of these easier issues to demonstrate that progress
continued to be made. Narsingh and Rijal agreed that a deal
was possible soon on these issues. Narsingh assured Emboff
that whatever federal system were adopted, it would not be a
system which carved the country up into ethnically
homogeneous provinces. That Maoist demand was simply
unacceptable. There were better ways, he and Rijal agreed,
to resolve Nepal's long-standing problems of caste and
ethnicity.

No Alternative to Maoist Abuses
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7. Ms. Bernicat repeatedly raised the question how success
was possible when the Maoists were being allowed to commit
abuses with impunity. All of the politicians present were
concerned, but seemed to have no alternative to the GON's
current policy of waiting until the Maoists are in
cantonments to reestablishing law and order. Each recognized
in turn the impunity with which Maoists continue to
perpetrate abuses.

Comment
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9. Kathmandu remains gripped in a heady atmosphere of
expectation. Hundreds of mostly Maoist protesters gather
during each session in front of the talks venue, the Prime
Minister's Residence. They graphically represent the rapt

anticipation and hope of Nepalis across the political
spectrum for a lasting peace. With talk of an interim
government taking office as early as November 15, many hope
these aspirations will be realized in the near future.
DEAN