CA ELECTION: WHAT IT MEANS FOR NEPAL

C O N F I D E N T I A L SECTION 01 OF 05 KATHMANDU 000448

SIPDIS

SIPDIS

E.O. 12958: DECL: 04/18/2018
TAGS: PGOV PTER KDEM NP
SUBJECT: CA ELECTION: WHAT IT MEANS FOR NEPAL

Classified By: Ambassador Nancy J. Powell. Reasons 1.4 (b/d)

Summary
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1. (C) In the wake of Nepal's April 10 Constituent Assembly
(CA) election, the Maoists have become the strongest
political force in the country. A large and diverse
Assembly, in which the Maoists will have a plurality, will
draft a new constitution. As its first act, the CA will
abolish Nepal's 240-year-old monarchy and declare Nepal a
republic. The shape of Nepal's new government is not yet
decided, but the Maoists will likely dominate it. The
Maoists will probably lay claim to the most powerful cabinet
posts, including Prime Minister, Defense and Home. From that
vantage point they will be in a good position to promote
integration of the Maoist People's Liberation Army into the
Nepal Army. We also anticipate a new inclusiveness in
government. A potentially hostile Madhesi belt between India
and Kathmandu will, however, limit the Maoist ability to
execute its program.

Change Is Here
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2. (C) Ten million Nepalis went to the polls on April 10 to
elect a long-awaited Constituent Assembly (CA). For the
first time in nine years, Nepal has held a general election.
It was not free and fair -- the pre-election violence and
irregularities, mostly by the Maoists, saw to that -- but it
has been generally accepted. Chief Election Commissioner
Bhoj Raj Pokhrel told the Ambassador April 17 that the
Election Commission (EC) expects to announce the final
results from both the 240 first-past-the-post (FPTP) races
and the proportional representation (PR) contest on April 22
or 23. (Note: These dates presumably exclude the five
constituencies where by-elections will be necessary. End
note.) The parties will then need to select their pro rata
share of the 335 PR candidates from the lists they submitted,
keeping in mind the various quotas. The CA is required to
meet 21 days after the EC announces those elected under the
PR system. According to the General Secretary of the Interim
Parliament, Manohar Bhattarai, the Assembly will probably
have its first session the week of May 26. The Interim
Parliament will be automatically dissolved when the CA meets.

Maoists Now the Dominant Political Force
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3. (C) While we do not yet know the final vote count, the
Maoists are projected to win 124 of the FPTP races and 111 of
the PR seats. This translates into a total of 235 of the
Assembly's 575 elected members. This puts them far ahead of
what is likely to be their closest rival, the center-right
Nepali Congress, which has dominated Nepal's politics since
even before the first People's Movement in 1990 ushered in
Nepal's democratic era. The NC will probably have to settle
for around 111 seats. The country's second most important
party, the center-left Communist Party of Nepal - United
Marxist Leninist (UML),is expected to fall into third place,
with roughly 106 seats. Any delusions that NC or UML had
about political parity with, let alone supremacy over, the
former Maoist insurgents have been destroyed. The Maoists
continue to be only party which has its own army (the
People's Liberation Army or PLA). In addition, they have a
youth wing at their disposal, the Young Communist League
(YCL),whose size and power far outweigh its NC and UML
counterparts. Finally, they have proven in the election that
they possess a superior ability to mobilize Nepali people --
whether by fear or favor -- for their ends.

Assembly to Be Large, Diverse and Largely Maoist
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4. (C) The new Assembly will consist of 601 members. It will
be much larger than any parliament the Nepalis have ever

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known. Even combined the lower and upper houses of the
1991-2003 Nepali parliaments consisted of 255 members. The
Interim Parliament established in January 2007 had 328
members. The CA will also be more diverse than any previous
Nepali legislature. We know that at least 26 women or 11
percent have been elected on the FPTP side. This compares
with 12 women or 6 percent elected in 1999 from among the 205
popularly elected MPs in the lower house. But women are not
the only group which will enjoy better representation in the
new body. Indigenous nationalities, Madhesis, Dalits and
other disadvantaged groups will see their absolute and
relative numbers rise. Much of this diversity will be thanks
to the Maoists who should enjoy a comfortable plurality in
the 601-member chamber. (Note: The post-election cabinet is
expected to appoint the final 26 CA members.)

CA To Abolish Monarchy
--------------


5. (C) As its name implies, the Constituent Assembly's
primary purpose is to draft a new constitution (although it
will also serve as the country's legislature). But that will
likely be a long and laborious task. The Interim
Constitution, which was promulgated in January 2007, sets
forth a complicated, consensual process. And there is
ultimately no guarantee that the parties will agree on a new
constitution within the two (and a half) year deadline. We
can easily envision the debates over what federalism means or
what sort of executive -- presidential, prime ministerial or
a mix of both -- Nepal is going to adopt taking months. Even
amending the Interim Constitution is not simple. It requires
a two-thirds majority of all members, which the Maoists will
not have. What we can say with confidence is that Nepal
240-year-old Shah dynasty will be abolished. The vote and
the declaration of a republic is supposed to be the CA's
first order of business. And with the exception of the
Rastrya Prajatantra Party-Nepal, which is projected to win 4
PR seats, there is no party to rescue King Gyanendra and his
clan. The monarchy has been largely powerless since April

2006. The restored Parliament in May 2006 proclaimed that
Nepal was no longer a kingdom and the Interim Constitution
confirmed that status. But this will be its true end.

Government Uncertain ...
--------------


6. (C) No one knows for sure what the new Government of Nepal
will look like. It is possible, even if, as we are told,
that is not the Maoists' preference, that they will find
themselves heading a minority government. The UML did this
from 1994 to 1995. At a minimum, the Maoists should be able
to form a coalition with the small, leftist People's Front
Nepal (PFN). PFN agreed to an electoral alliance with the
Maoists and has long been seen as the Maoists' closest ally
within the governing Seven-(later Six-) Party Alliance. It
is projected to win 7 seats. At the other end of the
spectrum would be an all-party unity government. The latter
seems less likely than the former. Leaving policy conflicts
aside, 22 parties could end up sitting in the CA. Several
major party leaders claimed before April 10 that an all-party
unity government was their intention, but that was before the
Maoists' electoral earthquake. We know that the Maoists have
been reaching out to the NC and the UML. Those two parties,
meanwhile, are not sure what to do. Per a participant, an
informal meeting of the NC's Central Committee April 17
recommended to the party leadership to stay out of government
and go into opposition. Some prominent UML leaders
apparently share that view as well. The Maoists seem to be
anticipating that they may have trouble attracting coalition
partners. Maoist chief Pushpa Dahal (aka Prachanda) has
indicated privately that he is prepared to fill at least
certain positions (e.g., the Central Bank Governor) with
technocrats.

But Certainly Maoist
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7. (C) One idea we are not hearing is that the NC and UML
intend to combine forces with the Madhesi parties and others
to form an anti-Maoist government coalition. It is
theoretically possible. Based on projections, the Madhesi
People's Rights Forum's 37 seats would suffice to give an
NC-UML-MPRF troika 254 seats and a 19-seat advantage over the
Maoists. Various combinations of additional parties could
give the troika the 288 seats for a simple majority of the
CA's elected seats. For example, incorporating the other two
United Democratic Madhesi Front parties (Terai-Madhes
Democratic Party or TMDP and Sadbhavana Party or SP),the
SP's precursor party (NSP-A) (which in the governing
alliance) and the non-royalist Rastrya Prajatantra Party of
Pushapati Rana should be enough to do the trick if
projections prove accurate. What the theory fails to take
into account, however, is the reality that the Maoists won --
fairly or not -- the largest share of the vote. They can at
least claim the moral authority to have the first opportunity
to form a government. And we anticipate the other parties
will eventually concede that point. In a sense, NC, UML, et
al. have already done so by not contesting the overall
outcome.

Continuation of the Six-Party-Plus-Maoist Alliance
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8. (C) Unlike traditional Westminister-based governments, the
current Government of Nepal's (GON's) existence is not
derived from the legislature. The Interim Constitution
provides in Article 38 that the cabinet shall be formed on
the basis of a "political understanding." Political
understanding is defined as the 12-Point Agreement seven (now
six) parties signed with the Maoists in New Delhi in
November 2005. That agreement laid the foundation for the
April 2006 People's Movement, the peace process, and
ultimately, the CA election. Whether Article 38, which is
highly undemocratic, will now be amended is not yet clear.
Prime Minister (and NC President) G.P. Koirala has stated
that he hopes the governing alliance will continue. C.P.
Mainali, who is head of one of the minor governing parties --
the Communist Party of Nepal - Marxist Leninist -- indicated
April 18 to Emboff that he too hoped the alliance would go
on. He admitted, however, that the arrangement might have to
be adjusted to include the Madhesi parties.

Maoists Could Covet "Power" Ministries
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9. (C) Assuming the Maoists do form the post-election
government, we expect them to insist on the so-called "power"
ministries. The party's top brass have already staked a
claim on the prime ministership and we foresee demands for
the defense and home ministries following. Prior to joining
the Interim Government in April 2007, the Maoists sought the
latter two. As the single largest party this time around, it
will be difficult to deny the Maoists any of the three. The
Defense Ministry, with only one brief exception in Nepal's
democratic history, has gone only to the Prime Minister. It
is has never been held by someone outside the PM's party.
The leading party has also traditionally named a Home
Minister from among its ranks. Some observers presume the
Maoists will seek the Foreign Ministry as well. Others
figure the Maoists will give that post to someone less likely
to ruffle feathers in foreign capitals. The Finance Ministry
is another potential Maoist target because of its control of
the public purse and donor assistance -- if a credible
nominee can be found. The Maoists have found the Information
Ministry and its control over Nepal's public media to be a
useful tool so far. We suspect they will try to hold on to
it. Finally, from among its other four ministries, Local
Development could make the cut. Pushapati Rana informed the
Ambassador that April 16 that the Maoists are probably
planning for required local government elections. Local
Development plus Home, which controls the police, would give
the Maoists enormous influence over the outcome.

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Nepal Army Wary
--------------


10. (C) With the exception of the monarchy, the domestic
institution that may fear a Maoist victory the most is the
Nepal Army. Two years ago, the NA was fighting a war against
the PLA. While the two armies have not engaged in any
clashes since the cease-fire in May 2006, they have come
close several times, including days before the CA election.
NC leader Prakash Sharan Mahat confided to Emboff April 17
that in hindsight it had been a mistake to defer the question
of integrating the PLA into the NA until after the CA
election. He feared that a Maoist Defense Minister would be
able to integrate the PLA on Maoist terms because the Maoists
would control both. We are not convinced that the Maoists
will have carte blanche. The Indians should prevent that.
But Prachanda (who continues to be the commander of the PLA)
and his comrades will attempt to transform the institution.
That has long been a stated objective. Chief of Army Staff
Rookmangut Katawal will presumably be the first to go. If
the Maoists take over the Home Ministry, they will purge the
top ranks of the ministry as well as the Nepal Police (NP)
and the Armed Police Force (APF). Other parties have done
the same at the outset. One unanswered issue will be the
effect of PLA combatants joining the NA -- and perhaps YCL
joining the APF or the NP -- on the availability of Nepali
security forces for peacekeeping operations.

Inclusive Government
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11. (C) Another likely Maoist objective -- and one the U.S.
could welcome in principle -- would be creating a more
inclusive bureaucracy. Especially in the senior ranks,
Nepal's civil service is commonly the domain of male,
"pahadi" (hill-origin) Brahmins/Chhetris. Widespread anger
about deep-rooted discrimination against marginalized groups,
including women, indigenous nationalities, Madhesis and
Dalits, was one of the driving forces behind the 10-year
Maoist insurgency and the 2007 Madhesi Uprising. The
question will be how the Maoists go about it. Will they use
legal means or will they employ extrajudicial methods? The
Maoists will probably push as well for other issues close to
them -- such as dealing with disappearances, at least by the
state, and compensating Maoist supporters who suffered from
abuses by the security forces.

Madhesis May Not Go Along
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12. (C) Since at least 2006 it has been the Maoists who have
driven the political debate in Nepal. The only force to
seriously challenge them, beginning in 2007, has been the
Madhesis. The Madhesis demonstrated, as recently as February
2008, that they had the power to cut Kathmandu off from
India. The leader of the strongest of the Madhesi parties --
Upendra Yadav of the MPRF -- has not ruled out cooperating
with the Maoists. (Note: Yadav was himself a Maoist for a
time. End Note.) But the Madhesi animosity toward the
Maoists is legendary. If a Maoist-led government fails
within a reasonable time to begin to fulfill the promises
that PM Koirala made to the United Democratic Madhesi Front
parties in February, the Maoists will face serious trouble.
Residents of the capital would probably welcome a government
that enforced the oft repeated prohibition on general strikes
and transportation blockades. The more difficult question
would be whether the Maoists could bring the Madhesis in line
without excessive violence and bloodshed.

Comment
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13. (C) The Nepali Congress and the UML have not yet decided
if they will participate in a new Maoist-dominated
government. The parties themselves will have to make the

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final decision, but we are not sure that their going into
opposition will serve Nepal well. It would be shortsighted
for them to stay away if their hope is that thereby the
Maoist government will fail and they will be able to step in.
It is also not the time for the Congress and the UML to look
back and endlessly rehash what went wrong on April 10. If
they are going to contribute to solving the serious issues
that Nepal faces, they need to look forward.
POWELL