It looks like we're getting to crunch time here in Nepal. The Maoists are still stringing along talks with the GON, hoping that the GON will follow up on its past four months of unilateral concessions by caving in and allowing an armed Maoist movement into an interim government.

79370 9/22/2006 11:26 06KATHMANDU2587 Embassy Kathmandu SECRET//NOFORN "VZCZCXYZ0064OO RUEHWEBDE RUEHKT #2587/01 2651126ZNY SSSSS ZZHO 221126Z SEP 06FM AMEMBASSY KATHMANDUTO RUEHC/SECSTATE WASHDC IMMEDIATE 3260INFO RUEHBJ/AMEMBASSY BEIJING IMMEDIATE 4805RUEHLM/AMEMBASSY COLOMBO IMMEDIATE 5034RUEHCP/AMEMBASSY COPENHAGEN IMMEDIATE 0329RUEHKA/AMEMBASSY DHAKA IMMEDIATE 0184RUEHLO/AMEMBASSY LONDON IMMEDIATE 4428RUEHNE/AMEMBASSY NEW DELHI IMMEDIATE 0264RUEHNY/AMEMBASSY OSLO IMMEDIATE 0245RUEHKO/AMEMBASSY TOKYO IMMEDIATE 0988RHHMUNA/CDR USPACOM HONOLULU HI IMMEDIATERHEHNSC/NSC WASHDC IMMEDIATERUEAIIA/CIA WASHDC IMMEDIATERHEFDIA/DIA WASHDC IMMEDIATERUEKJCS/SECDEF WASHDC IMMEDIATERUCNDT/USMISSION USUN NEW YORK IMMEDIATE 1963" "S E C R E T KATHMANDU 002587

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DEPT FOR S, P, AND SCA FROM THE AMBASSADOR

E.O. 12958: DECL: 09/22/2016 TAGS: PGOV, PREL, PTER, IN, NP SUBJECT: CRUNCH TIME IN NEPAL?

Classified By: Ambassador James F. Moriarty, reasons 1.4 (b/d).

1. (S/NF) It looks like we're getting to crunch time here in Nepal. The Maoists are still stringing along talks with the GON, hoping that the GON will follow up on its past four months of unilateral concessions by caving in and allowing an armed Maoist movement into an interim government. The Prime Minister assures me that he has no intention of doing that. If he does not, then the Maoists appear intent on organizing during the month of October massive public demonstrations designed to pressure the GON into putting the Maoists on the path to power. If the government still refuses to cave, the Maoists, according to a number of pretty good sources, seem ready to move in November to a campaign of urban violence, using the demonstrations as cover. Again, the goal of the violence would be to intimidate the government into handing over the keys to power.

A Tremendous Bluff?

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2. (C) The good news is that the Maoists are doing much of this through bluff. They have relatively little popular support, and they have nowhere near the military capability to take on the government's security services in an open fight. The bad news is that the bluff may work. The Prime Minister is desperate to avoid being blamed for being the one who derailed the peace process. Just as important, the Home Minister, who also happens to be the government's chief negotiator with the Maoists, fears that enforcement of the law against them could lead to the insurgents walking away from the negotiating table. Thus, the police are standing aside while the Maoists engage in extortion, intimidation, kidnapping, and the occasional murder -- as well as preparing for their October push against the government. The government inaction is leading many Nepalis, particularly in Kathmandu, to think that a Maoist victory is inevitable.

What We Need to Do

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3. (C) Brow-beating: Ultimately, decisions made by Nepalis will determine whether this country goes down the path toward becoming a People's Republic over the next couple of months. That said, we need to increase the possibility that the leaders here will make the right decisions. I've been meeting regularly with the Prime Minister, urging him (so far unsuccessfully) to use the police to enforce law and order and bucking him up to stick to his bottom line of not letting gun-toting Maoists into the government (with greater success so far). We've also been pushing the other major parties of the Seven Party alliance to support the Prime Minister on arms management and to push him to use the police against Maoist excesses. I've also created a firestorm of controversy by visiting a couple of military bases (as well as a lot of civilians) out West and publicly condemning Maoist violence. Leftist MP's have called for my expulsion, but at least some of the people here are beginning to debate Maoist intentions.

4. (S/NF) Preparing for the worst: We need to be prepared for the possibility of a Maoist return to violence in November. The key will be to condemn as quickly as possible Maoist violence, while shipping as quickly as possible some 4,500 more weapons that we have in storage for the Nepali Army. Those weapons would have an immediate tactical impact but more importantly would shore up a government that will be under tremendous pressure to capitulate.

5. (S/NF) The Diplomatic game: The diplomacy here is getting complicated. The Europeans are all over the map with respect to recent developments. The Danes and Norwegians (who have some clout here because of their aid programs) are convinced that lasting peace is just about ready to break out and push the GON to be as accommodating as possible. The Brits, in contrast, seem convinced that the Maoists will soon be coming into power and are trying to convince themselves that that might not be so bad. The Chinese seem primarily interested in pushing Tibet issues with the weak, frequently ineffectual GON. The local World Bank rep is so fed up with the corruption in the system that he has become a frequent lunch pal of the Maoist supremo. I'm trying to push back here on some of this, but it would help if the Department could have a serious, high-level discussion with the Brits on Nepal. We might also want to look at a demarche to the Europeans and others (reminding them that the Maoists are not just agrarian reformers and seem to want power rather than peace). And finally...

Working with India

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6. (S/NF) From my perspective, we need to do more to keep the Indians in lock-step with us. I coordinate closely with my Indian counterpart here and in private he pushes the exact same message I do: that the police need to enforce law and order and that the GON should not let armed Maoists into an interim government. I was more than a little annoyed to find out, however, that the Indian Embassy had complained to the PM's office about our training activities with the Nepal Army. (The Indian Ambassador assured me that the message had been that those exchanges should occur more quietly and had been delivered without instructions from New Delhi.) The incident underscored the fact that, while worried about current trends, New Delhi seems oblivious to how close the Maoists are getting to victory here. That makes sense: New Delhi godfathered the working relationship between the Maoists and the Parties and doesn't want to acknowledge that it might have created a Frankenstein's monster. Moreover, India's Marxist party (a key supporter of the governing coalition) has proclaimed that everything here is going just fine. In that context, I hope that a discussion on Nepal will feature prominently in future conversations with senior Indian leaders.

Comment

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7. (C) The next few months will go a long way to determining whether the Maoists have any intention of coming in out of the cold, or whether there only goal is absolute power. Up until now, all signs point to the latter. I continue to fear that a Maoist assumption of power through force would lead to a humanitarian disaster in Nepal. Just as important, a Maoist victory would energize leftist insurgencies and threaten stability in the region. It thus behooves us to continue to do everything possible to block such an outcome.

MORIARTY "