PRIME MINISTER UNEASY ABOUT FORMING INTERIM

C O N F I D E N T I A L SECTION 01 OF 02 KATHMANDU 000668 SIPDIS SIPDIS E.O. 12958: DECL: 03/30/2017 TAGS: PGOV PREL PTER IN NP SUBJECT: PRIME MINISTER UNEASY ABOUT FORMING INTERIM GOVERNMENT WITH MAOISTS Classified By: Ambassador James F. Moriarty. Reasons 1.4 (b/d) Summary -------------- ¶1. (C) Prime Minister Koirala told the Ambassador March 30 that he faced tremendous pressure to form an interim government with the Maoists before he departed April 1 for New Delhi to attend the South Asian Association of Regional Cooperation (SAARC) Summit. Koirala said he was being pressed by members of the Seven-Party Alliance (SPA),the Maoists, Nepali civil society and the Government of India (GOI) and indicated he was having difficulty resisting. The Prime Minister conceded he had not yet reached agreement with his coalition partners on which party would obtain the Defense, Home and Finance Ministries or a Deputy Prime Ministership. He admitted he was baffled why the GOI was pushing him so hard. Koirala expressed unease about bringing the Maoists into the government. He agreed with the Ambassador that their behavior had not changed. If that pattern continued, the PM stated, Constituent Assembly elections would not be free and fair. The Ambassador noted the new Home Minister would face great challenges in enforcing the rule of law after nearly a year of Maoist impunity. Koirala agreed the law and order situation was dire, including for business, and promised the SPA and the Maoists would issue a statement agreeing to enforce the law when an interim government was formed. Prime Minister Pressed To Form Interim Government -------------- -------------- ¶2. (C) On March 30, Prime Minister Girija Prasad Koirala informed the Ambassador that he was facing tremendous pressure from all sides to bring the Maoists into an interim government within two days. He said he was scheduled to leave Kathmandu for New Delhi April 1 in preparation for the April 4-5 SAARC Summit. Members of the governing SPA, particularly the Communist Party of Nepal - United Marxist Leninist (UML),were pressing him to act now. The same was true of the Maoists, civil society and the GOI. Koirala said he had resisted pressure to form the new government for a long time, but the tension was becoming more than he could bear. His difficulties, he admitted, were compounded by his poor health. Koirala complained, and his Foreign Policy Advisor, Suresh Chalise, who was present, seconded that he was once again experiencing serious respiratory problems. Ministries, Deputy Prime Ministerships Still In Play -------------- -------------- ¶3. (C) The Prime Minister said that, despite long rounds of talks with the principal parties, he had not yet reached agreement on the allocation of certain key ministries. In the talks, he had insisted that his Nepali Congress Party (NC) retain its hold on the Defense, Home and Finance Ministries. Beyond those cabinet seats, he was willing to accept nearly any configuration that the other parties were able to agree on. But UML General Secretary M.K. Nepal was balking. Koirala said M.K. had demanded the Home Ministry for the UML. The Prime Minister wondered aloud why the UML General Secretary was being so difficult. Was he trying to make common cause with the Maoists? The Ambassador responded that he did not think so. M.K. Nepal was playing politics. The Ambassador added that during his meeting the day before with Nepal (septel),he had pushed the UML chief for assurances any UML Home Minister would be prepared to enforce the law. Nepal had equivocated. Koirala reported that the Maoists had at first demanded they be given the Senior Deputy Prime Ministership since the other major parties held the other top posts. They had since backed down and accepted that the senior slot would be from NC. The Prime Minister did not specify who from the NC would get that job. Confused by India -------------- ¶4. (C) Prime Minister Koirala admitted that he was baffled by the GOI pressure. He did not understand why the Indians -- KATHMANDU 00000668 002 OF 002 he mentioned recent phone calls from Foreign Secretary Menon and Indian Ambassador Mukherjee -- were now pressing him so hard to immediately form an interim government with the Maoists. The Ambassador conceded that he too was confused. He gathered that New Delhi had become particularly concerned about the situation in the Terai after the Gaur massacre March 21. The Ambassador speculated that there might also be domestic Indian political reasons for what appeared to be a major shift in GOI policy, but he did not know what those reasons could be, and noted he had sought assistance from Embassy New Delhi. Koirala commented somewhat bitterly that Indians had claimed for a long time that the Terai was "theirs"; now it was time for them to use their influence there to fix the problem. The Prime Minister and Chalise stressed that the Government of Nepal was prepared to give the Madhesis the representation that was their due. Uneasy About Maoist Entry Into Government -------------- ¶5. (C) The PM openly admitted that he was uneasy about allowing the Maoists to enter an interim government. He affirmed that he shared the Ambassador's opinion that Maoist behavior had not changed. They were continuing their pattern of extortion and violence. The Ambassador pointed out that business was also suffering terribly from Maoist violence, citing the case of Nepal's Tibetan rug industry. The Prime Minister agreed and worried what would happen to the country's economy with many joint ventures closing down due to inordinate Maoist demands. Koirala stated without hesitation there could be no free and fair Constituent Assembly election if such Maoist actions continued. He added that it would be impossible to hold acceptable elections by mid-June, despite the desire of the GOI. New Home Minister Faces Serious Challenges -------------- ¶6. (C) The Ambassador pointed out that the new Home Minister, whoever it was, would encounter grave difficulties in enforcing law and order. After 11 months without enforcing the law, particularly in the case of Maoist crimes, the Nepali Police were completely demoralized. Even if the new minister were committed to changing that policy and ending Maoist impunity, he or she would have to overcome profound skepticism of his or her ability to implement that policy. This problem would be particularly acute, the Ambassador stressed, if the Maoists were allowed to come into the government without a clear change in their actions. The Prime Minister did not disagree. He conceded that the task would be a gargantuan one. He was already doing what he could, he said, to boost police morale. The PM noted he had reached out to senior police -- without involving Home Minister Sitaula. He also stated that he would insist that all the parties in the new government issue a statement that the rule of law would be enforced and that anyone carrying an illegal weapon would be arrested. Comment -------------- ¶7. (C) The trials and tribulations Prime Minister Koirala is facing would take a toll on a young and healthy leader. He is neither. We left the meeting unsure what the PM would ultimately decide to do: form the government before departing for the SAARC Summit or, as we suspected he prefers, wait until after he returned. Subsequent comments from other Embassy contacts about whether an interim government with the Maoists will be formed by April 1 have been contradictory. (Some say it could happen as soon as March 31; others claim the talks are deadlocked.) What is apparent is that whoever inherits Minister Sitaula's position as Home Minister -- and Koirala's clear implication was he intended to replace Sitaula -- will have a job no one will envy. He or she will face the ire of the public or the ire of the Maoists, but will not be able to please both. MORIARTY