INDIA AND THE US ON NEPAL: STILL NO DAYLIGHT, WE

C O N F I D E N T I A L SECTION 01 OF 02 NEW DELHI 001320

SIPDIS

SIPDIS

E.O. 12958: DECL: 02/21/2016
TAGS: PREL PTER MASS IN NP PK
SUBJECT: INDIA AND THE US ON NEPAL: STILL NO DAYLIGHT, WE
AGREE

REF: KATHMANDU 473

Classified By: PolCouns Geoff Pyatt for Reasons 1.4 (B, D)


1. (C) Summary: MEA Joint Secretary (North) Pankaj Saran
sought reassurance on February 22 that India and the US were
still reading off the same page on Nepal policy, and
underlined that India still sees the Maoist insurgency as the
principle problem in Nepal. He requested USG action to
convince Pakistan to desist from arms sales to Nepal. Saran
reported that the GOI continues to take a tough line with the
King, and gave a gloomy outlook for chances of
reconciliation. End Summary.

Perspectives on Maoist Intentions
--------------


2. (C) Pankaj Saran, meeting with PolCouns and SA/RA
Director John Schlosser, agreed that in a broad perspective,
the US and India share the same "understanding of the issues"
facing Nepal. The principle problem is the Maoist
insurgency, Saran stated, and we agree that the solution
ultimately rests in a political settlement. However, he
continued, Ambassador Moriarty's February 15 speech led some
in India to question whether the US might be taking a
different tack, introducing a "degree of uncertainty at a
very sensitive stage" by questioning the wisdom of the
political party-Maoist twelve point understanding. He said
"frankly" that the GOI faces severe domestic questioning on
its Nepal policy, and lamented that critics have used
Ambassador Moriarty's speech to argue that the US is now
following a different policy.


3. (C) In response, PolCouns noted that the USG does not see
any daylight developing between its position and the Indian
position toward Nepal. The speech, PolCouns and Schlosser
pointed out, reiterated previous USG concerns about Maoist
intentions, particularly in light of vitriolic and
anti-American language in interviews given by Maoist leaders.
Saran agreed that recent Maoist violence and statements
raised fears among GOI and Nepalese politicians about Maoist
sincerity, adding that the GOI believes the "dominant mood"
in the parties is to continue nonetheless with the twelve
point understanding.

Pakistan Arms Supplies
--------------


4. (C) Saran referred to earlier requests that the USG
prevail on Islamabad to avoid supplying military equipment to
Nepal, and said that the GOI had recent indications "within
the past four months" of continued arms sales both from the
private sector in Pakistan and from government-run ordinance
factories. He requested that Washington again demarche the
GOP to refrain from stepping in to supply arms to Nepal.

Next Steps for Nepal
--------------


5. (C) Saran reported that the GOI was, at HMGN's request,
reviewing whether it could restart low-level, routine
functional exchanges between Indian and Nepalese bureaucrats
that had been suspended following the February 2005 takeover.
The Nepalese Foreign Minister, he added, will be making an

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unexpected visit in the next week to Varanasi to inaugurate,
"of all things," a seminar at Benares Hindu University on
democracy in Nepal.


6. (C) The GOI continues to say publicly that the monarchy
has a role to play in Nepal, hoping to allay the palace's
fears, Saran stated. However, the King's actions have put
him in the situation he faces today where the Maoists and
parties have jointly opposed the monarchy. "If you ask me
today," India's policy is to support the "twin pillars" of
constitutional monarchy and multiparty democracy, Saran said,
but "the situation is changing in Nepal." Foreign Secretary
Shyam Saran told Gyanendra in December that "if he doesn't
watch out, he will no longer be part of the solution," Saran
reported, adding, "if he doesn't listen to that advice, he
will face the consequences."


7. (C) The Nepal of 2006 is no longer the Nepal of 1990,
Saran continued. The King cannot roll back twelve years of
experience with democracy and hope for a return to panchayat
rule. While the parties are imperfect, Nepalese society has
adopted civil institutions of democracy like political
parties and human rights activists, and the King cannot
ignore this. The majority of political parties are not
resolutely opposed to a monarchy, Saran observed, but "each
situation has a timeline." The GOI has told Gyanendra that
doing nothing may eventually lead to a republic with no role
for the monarchy.

COMMENT: WORRIED, BUT STILL IN SYNC
--------------


8. (C) Saran was clearly unnerved by speculation in the
Delhi and Kathmandu press arguing that Ambassador Moriarty's
criticism of the twelve point agreement indicated that the US
was preparing to more strongly back the King and implicitly
attacking Indian foreign policy. He welcomed our reassurance
that we not only have not changed our (negative) assessment
of the Palace's actions in the past year, but also accord a
high value to staying in step with India. That said, India's
plan B continues to be hoping that plan A (pressing the King
to back down) will eventually yield fruit before Nepal
descends further into crisis.


9. (U) Visit New Delhi's Classified Website:
(http://www.state.sgov.gov/p/sa/newdelhi/)
MULFORD