UPDATE ON NEPAL'S PEACE PROCESS

C O N F I D E N T I A L KATHMANDU 002777

SIPDIS

SIPDIS

E.O. 12958: DECL: 10/17/2016
TAGS: PGOV PTER PARM NP
SUBJECT: UPDATE ON NEPAL'S PEACE PROCESS


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

Summary
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1. (C) USAID-contracted peace facilitator Siebert highlighted
the difficulties Government of Nepal (GON) and Maoist
negotiators faced in addressing the Maoist militia and
security issues in an update for Charge on October 18.
Senior politicians in the center-right Nepali Congress (NC)
and the center-left Communist Party of Nepal - United Marxist
Leninist (CPN-UML) told Pol/Econ Chief October 17 and 18,
respectively, that divisions remained between the Government
of Nepal and the Communist Party of Nepal (Maoist)(CPN-M) on
arms management as well as other issues. Divisions within
the Seven-Party Alliance on these same issues also posed a
continuing problem. They speculated, however, that a peace
deal might nevertheless be possible within one to three weeks.

Security Issues Proving Thorny
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2. (C) Hannes Siebert, the South African peace facilitator on
contract from USAID, updated Charge October 18 on the various
challenges that the negotiators from the Government of Nepal
(GON) and the Communist Party of Nepal (Maoist) were facing
with respect to the panoply of security issues. The question
of what to do about the Maoist militia, he pointed out, had
now really come to the fore. The arms management piece of
the negotiations had already been struggling, he said, to
come to grips with the Maoist People's Liberation Army (PLA)
and its weapons on the one hand and the Nepal Army on the
other. Adding in perhaps as many as 100,000 Maoist militia
made the matter even more complicated. He noted that the
negotiators had recognized early on the need to deal with the
militia, but had been at a complete loss on how to proceed
given the perceived sensitivity of the peace process to GON
law enforcement. One idea being considered was to have
15,000 of the militia go into cantonments along with the PLA.
That still left 80 plus thousand outside. Ensuring security
was going to be a key issue, Siebert predicted, for local
peace councils. It would also require the creation of
special institutions: it could not be a GON monopoly.

Interim Government and Parliament In Play
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3. (C) The peace facilitator remarked to Charge that the two
sides were closer to agreement on the interim executive or
government than on the interim parliament. One idea under
consideration was to give the interim executive more power
relative to the parliament. Arjun Narsingh, a senior leader
of the center-right Nepali Congress, and Jhalanath Khanal, a
former secretary general of the center-left Communist Party
of Nepal - United Marxist Leninist, told Pol/Econ Chief
October 17 and 18, respectively, that no agreement had been
sealed on the form of the interim government. Khanal told
Emboff that the eight parties (the Seven-Party Alliance and
the Maoists) would be given seats in the interim cabinet in
the same ratio as their representation in the interim
parliament. (Siebert had told us previously that another
formula under consideration would give four seats each in the
government to the NC, the CPN-UML, and the Maoists, with the
other parties getting one or two at the most.) According to
Narsingh, consensus was developing to create a parliament of
325 members based on the existing 205-seat parliament. He
said the Maoists would probably receive 75 seats. He claimed
that the other members of the SPA would also gain some seats.
He added that PM Koirala had told the CPN-UML a day earlier
that they would probably have to accept parity with the CPN-M
in terms of MPs. The Maoists, the NC politician remarked,
had initially insisted that they be second only to the NC,
the current parliament's largest party. Khanal ventured, in
contrast, that the CPN-UML would be second, followed by the
Maoists, but he did concede that all the parties would have
to sacrifice in order to give the Maoists sufficient standing
in the interim government and parliament.

What Role for Prachanda and His Deputy?
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4. (C) Narsingh told P/E Chief that his understanding was
that Maoist Supremo Prachanda and his deputy Baburam
Bhattarai did not intend to serve in either the interim
government or the interim parliament. When asked if that was
not cause for concern about the Maoist leaders' commitment to
the political process, he did not disagree. In response to a
question about his views, Khanal was emphatic that the seven
parties would insist that at least Bhattarai joined the
cabinet. It would be too dangerous otherwise.

Role of the Monarch As a Maoist Weapon
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5. (C) Khanal urged the Embassy to press the Nepali Congress
to join a consensus with the other SPA member parties on the
future of the monarchy. The CPN-UML leader stressed that, as
long as the SPA was divided, the CPN-M would use the issue of
the monarchy as a weapon against the other parties. A
unified SPA position, on the other hand, would allow the SPA
to focus attention on the real issue in the peace talks,
namely Maoist arms management. Khanal conceded that there
continued to be a large number of Nepalis who supported the
existence of the monarchy. That was one reason, he stated,
why he opposed the Maoist proposal for the peace negotiators
to declare Nepal a republic right away. What he had
difficulty understanding was why the NC was unwilling to
agree to a referendum on the issue. P/E chief explained that
the USG was agnostic on how the question of the king's role
was decided as long as the people were consulted. It was up
to the Nepalis themselves to decide whether to hold a
referendum (as the CPN-UML preferred) or to leave the
decision to the constituent assembly (as the NC preferred).

Arms Management
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6. (C) Khanal agreed that a solution had to be found to the
Maoist militia. It was currently under negotiation.
Prachanda had told Khanal personally, Khanal reported, that
the militia would lay down their arms -- if the "political
issues" were resolved, meaning the question of the king. When
pressed, Khanal did not have a clear answer on whether the UN
or some other institution or mechanism would be established
to handle the actual handing over of the militia's weapons,
but he affirmed it would have to be spelled out in any final
deal.

Comment
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7. (C) Anticipating when or even if there will be a peace
deal in the coming days or weeks is a difficult task, and
especially tricky given the rapid pace of developments here.
There are still real issues to be resolved, as all of our
interlocutors have made clear. There is also genuine
optimism that this time, in spite of all the problems, some
solution will be found. NC leader Narsingh told Emboff he
thought a peace agreement could come in 1-3 weeks. The UML's
Khanal was even sunnier: he said a deal had to come within
7-10 days. There would be otherwise not be enough time to
make the announced plan to hold constituent assembly
elections in the mid-May- mid-June timeframe a reality. We
shall see.
DEAN