BANGLADESH POLITICAL RERUN: THE SHEIKH

C O N F I D E N T I A L SECTION 01 OF 02 DHAKA 000982

SIPDIS

E.O. 12958: DECL: 09/16/2018
TAGS: PGOV PINR KDEM BG
SUBJECT: BANGLADESH POLITICAL RERUN: THE SHEIKH
HASINA-KHALEDA ZIA SHOW IS BACK ON AIR

Classified By: Ambassasdor James F. Moriarty. Reasons 1.4 (b) and (d)

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SUMMARY
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1. (C) The Caretaker Government's "minus-two policy" has
become an "only-two policy." Not long ago the Government
envisioned removing former prime ministers Sheikh Hasina and
Khaleda Zia from politics as the key to fixing Bangladesh's
dysfunctional democracy. In releasing them from jail, where
they awaited trial on graft charges, over the past two months
and urging them to meet together with top Government
advisers, the Government has acknowleged there can be no
return to democracy without the two ladies' cooperation.
(Note: The government did succeed, however, in forcing Zia's
notoriously corrupt eldest son, Tarique Rahman, to retire
from politics and leave the country for at least a few years.
End note.) While there are indications the two women are
amenable to a summit, it is not yet clear how far such a
meeting could advance the cause of political reform.
Increasingly clear, however, is that any fundamental reform
of Bangladesh's deeply corrupt political system will require
the acquiesance of the two women most responsible for the
country's poor governance.

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KHALEDA ZIA, SHEIKH HASINA TAKE CENTER STAGE
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2. (C) Immediately after her release September 11 from jail
on bail, Bangladesh Nationalist Party (BNP) Chairwoman
Khaleda Zia set about reunifying her party and getting it on
track for contesting Parliamentary elections in December. She
talked privately with two leaders of a reformist faction that
had split with her loyalists. One of the reformists, Lt. Gen.
(retired) Mahbubur Rahman, described the meeting as friendly
and said Zia appeared less uncompromising than in the past;
he subsequently took his seat at a BNP standing committee
meeting that she led. Zia also met with Government advisers
and agreed to enter a dialogue with the Election Commission
on political reform; other political parties already have
held similar talks.


3. (C) Awami League (AL) President Sheikh Hasina, who also
faces multiple corruption charges, remains in the United
States on medical parole but is expected to return to
Bangladesh soon. As a sign of the two ladies return to center
stage, Government advisers are seeking to hold a summit with
them to smooth the path back to democracy. This would be a
political coup because of the incredibly bad blood between
the two women -- the Awami League, for example, still blames
the BNP for an attempted assassination attempt on Hasina in
August 2004. (Note: A Septel will report on Ambassador
Moriarty's meeting with Education Minister Hossain Zillur
Rahman on September 16, including Hossain's take on
Government aspirations for the summit. End Note.) Mahbubur
Rahman said Zia had expressed a willingness to participate in
the summit; Awami League Acting General Secretary Syed
Ashraful Islam told PolOff he would encourage Hasina to
participate as well.

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STILL A LOT TO WORK OUT, BUT SOME HOPE FOR REFORM
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4. (SBU) There is a lot to work out, either at the summit or
in other negotiations between the parties and the Caretaker
Government, which came to power in January 2007 with a
mandate to clean up Bangladesh's corrupt and violent
politics. The BNP and Awami League continue to demand that
the state of emergency be lifted in the run-up to the
Parliamentary elections to ensure free and unfettered
campaigning. They also strongly oppose Election Commission
plans to hold upazilla (county) elections before the
Parliament vote. (Note: In a meeting with the United Nations,
the Chief Election Commissioner strongly hinted he was
leaning toward delaying the local elections until January.
End note.) The parties and Government have yet to agree how
reforms to make the political system more transparent and
less corrupt can be maintained after the election.


5. (C) Whether Zia and Hasina will support institutionalizing
reform remains unclear. Although they have spent their
political lives as absolute rulers of parties they treat as
personal fiefdoms, there are tentative signs that may be

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changing. Zia, for example, quickly rejected a BNP Standing
Committee resolution naming her "leader for life" after it
elicited howls of outrage both in and outside the BNP.
Mahbubur Rahman said Zia expressed support for reform in
general terms during their private meeting. Meanwhile, Syed
Ashraful Islam said the Awami League had prepared an Election
Manifesto that supported a number of measures to improve
governance -- one would require Parliamentary committee
meetings be open to the public and another would scrap a
Constitutional clause that requires members of Parliament to
vote along party lines. Until the two ladies make specific
pronouncements, however, reform prospects will remain deeply
uncertain.

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WHO'S WHO IN PARTY HIERARCHY MATTERS
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6. (C) Who advises the ladies will be important for reform
prospects. In one ominous sign, immediately after leaving
jail Zia appeared with Salauddin Quader Chowdhury, a
confidante who himself had just received bail in six cases of
extortion and amassing illegal wealth. In a positive sign,
Hasina derailed an effort by Awami League General Secretary
Abdul Jalil to return to active duty after his release from
jail on bail in six cases alleging tax evasion, bribery and
concealing information on illegally acquired assets.


7. (C) Most important, however, was the removal of Khaleda
Zia's eldest son, Tarique Rahman, from direct participation
in local politics for at least a while. Regarded as
phenomenally corrupt and facing multiple graft charges, he
received bail and flew to London for medical treatment
September 11. Zia said her son would stay out of politics
until his health fully recovered, perhaps two or three years,
and before leaving the country he signed a statement in which
he retired from his party post as senior joint secretary
general. Although some in the party already look forward to
Tarique's early return -- BNP Office Secretary Ruhul Kabir
Rizvi told PolOff that Tarique could return after as little
as 1 1/2 years -- others are heartened by his absence.
Mahbubur Rahman, for example, said Tarique's absence would
lessen the influence on the party of his coterie of wildly
corrupt friends and of the strongly partisan and excitable
BNP youth wing.

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COMMENT: ENTERING A CRITICAL PHASE
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8. (C) Caretaker Government efforts to bring lasting
improvement to Bangladesh governance is entering a critical
stage. Ambassador Moriarty already has publicly endorsed the
Government's call for a Hasina-Zia summit as the best way to
get the two ladies to buy into meaningful reform before the
election. The exit of Tarique Rahman and the continued
presence of at least some reform-friendly senior officials in
both parties suggests that the return of the ladies does not
necessarily mean a return to the bad old days of
dysfunctional politics. The Embassy will continue to urge all
political actors to speak to one another in a spirit of
compromise. We will soon know if the two ladies are
listening.
Moriarty