News update from Nepal, 02 March 2009 News Update from Nepal 10 March 2009 Human Rights and Governance Nepal's human rights situation continues to deteriorate. The Informal Sector Service Center-prepared Human Rights Year Book 2009 reveals that in the year 2008 out of 541 individuals murdered and 729 abducted, the UCPN(Maoist) cadres killed 12 and abducted 304, CPN-UML cadres killed 9 and abducted 22 individuals. In Tarai districts 369 persons were killed. 18 armed groups claimed responsibility for 79 murdered and 148 abducted persons. On February 8, International media mission concluded that press freedom in Nepal is backsliding despite the restoration of democracy. In 2008 the Federation of Nepalese Journalists(FNJ) recorded 342 cases of violation of media freedom. It condemned the arrest of three journalists Subhak Mahato, Manoj Mahato and Birendra Mahato by the police on charges of dealing arms. On February 3, the police also arrested Rishi Dhamala on charges of criminal activities. On February 7, NC President G. P. Koirala said the Maoist led government had failed, as it could not take a clear stand on the Nepal Army. He said that his party would never accept the integration of combatants into the NA. The NC initiated a meeting of 18 political parties including partners of the ruling coalition CPN-UML, Madhesi Jana Adhikar Forum(MJAF) and Sadbhavana Party. Subject was the special session of the parliament to debate on the ordinances and criticized UCPN(Maoist). To this, Prime Minister Puspa Kamal Dahal accused the NC and the CPN-UML leaders of derailing the peace process and termed their actions a"conspiracy of reactionary and status quoits forces." On February 27, the government decided to declare around 8,000 people which were killed during the Maoist insurgency, the April 2006 mass movement and the Madhesh movement as martyrs and provided each member of their families with$1234,56. The same day the government decided to give a voluntary retirement to over 13,500 civil servants who have already completed 50 years of age or served 20 years in the civil service along with a seven years salary and pension in a bulk. The ruling parties also decided to investigate the royal massacre at Narayanhiti palace, in which King Birendra and his family members were killed. 1

News update from Nepal, 02 March 2009 Peace Process On February 5, the second meeting of the Special Committee on adjustment, rehabilitation and supervision of the UNMIN-monitored Maoist combatants decided to discharge the 4,000 disqualified combatants, mostly minors, who joined the Peoples' Liberation Army after May 25, 2005. On February 12, Prime Minister Dahal appealed to the People's Liberation Army(PLA) to support the peace process and the decisions made by the Army Integration Special Committee(AISC). On February 15, he, however, directed his cadres to stand ready for another revolution. He said,"The reactionaries are against the newly-introduced ordinances and other government policies. They are hatching conspiracies against the government, peace process and constitution drafting." On February 5, Defense Minister Ram B. Thapa reiterated that the government is elected by the people and that the state organs must follow the government's decisions. He also said those who say PLA's integration into the Nepal Army would trigger civil war were trying to create a rift between the NA and the government and to disrupt the peace process. Badal said that the new recruitment row by the NA may cost peace. On February 13, the Chief of the Nepal Army, R. Katwal speaking to the CA said,"the Army never ruled the country and never intends to do so in future. It has its own rules and regulation. It functions as per the laws passed by the parliament. Nepal is not a failed state. If you understand this, you will be clear about the contribution of the army." On February 22, on the petition filed by the human rights non-governmental organization INHURED International, the Supreme Court issued an interim order to the NA to stop enlisting personnel until March 1. The plaintiff has claimed that the fresh recruitment in the NA is against the Clause 5.1.2 of the Comprehensive Peace Accord(CPA) signed in November 2006, which reads"Both parties shall not carry on further recruitments." Non-state actors of various sorts are deteriorating the security situation. On February 7, an armed group, Mongolian Mukti Morcha, attacked a Syaulibang police post, killed a constable and looted weapons. This group often threatens UCPN(Maoist) cadres. On February 9, an identified group shot at Shakti B. Basnet, the personal assistant of the Prime Minister Dahal at his residence in Kathmandu. He, however, survived. The Federal Limbuwan State Council has been operating kangaroo courts in the eastern region. Party Politics On February 2, the Unified CPN(Maoist) lawmakers passed the Parliamentary Party Statute of the party stipulating the establishment of communism through the people's federal democratic national republic and socialism after ending feudalism. The lawmakers criticized the statute saying it did not reflect the spirit of the people's revolution and of being overtly parliamentary. To this the Minister for Law, Justice and Parliamentary Affairs Dev Gurung said,"We are now in the Constituent Assembly, which is a part of our revolutionary front. The statute is just a process." 2

News update from Nepal, 02 March 2009 On February 2, UCPN(Maoist) and CPN-UML met and agreed to make the necessary corrections on the three ordinances-Investment Board, Special Economic Zone and Investigation of the Disappeared- promulgated earlier. After nine months of wrangling the NC Parliamentary Party(PP) has endorsed its statute, giving the PP leaders the authority to nominate a deputy at the parliament. But, parliamentarians decided to continuously lobby for the direct election of the deputy leader. On February 13 NC President Girija P. Koirala said that the new constitution should follow the parliamentary constitution."We should follow the Swedish model that advocates decentralization of power from central to local level. If the federal states cannot be economically viable, it may lead the country to disintegration. To adopt the presidential system is to impose authoritarianism in the country. Any party that advocates this system will collapse." The UCPN (Maoist) prefers the presidential form of government. Koirala also directed the cadres of his party to retaliate if Maoists threaten them. On February 8, seven major political parties- five parties of the ruling coalition, the NC and Tarai-Madhesh Loktantrik Party(TMDP)- reached a four-point understanding to bury their differences on government's decision to establish the Integrated Service Centers(ISC) in some districts. They agreed that ISCs would be established after the recommendations of the district-level all-party meetings. On February 10, the Politbureau member of UCPN(Maoist) Matrika P. Yadav, having been expelled from the party, reconstituted a new CPN(Maoist). He blamed the UCPN(Maoist) for a lack of party discipline, dominated by non-proletarians and also appreciated the struggle of the Tarai-based parties against the hill domination. He blamed the leaders of not taking any initiative to secure the release of its activists who have been arrested in India and China and are serving jail terms now. On February 13 the UCPN(Maoist) leader C. P. Gajurel said that"the people are gradually losing faith in the Maoists. It revealed that the preparation is going on for the"third people's movement" under the party leadership to establish the People's Republic. The UCPN(Maoist) top leaders PM Dahal and Dr. Baburam Bhattarai blame that the former King Gyanedra's recent visit to India to attend the wedding of his relative would have aimed at making a way"for his grandson Hridayendra's ascension to the throne." They also attacked NC and CPN-UML for trying to topple the government. In the CPN-UML's eighth-party convention that began on February 16, Prime Minister Dahal said,"If any party can prepare a people-oriented constitution, then it is only communist parties as they have a two-third majority." The former General-Secretary M. K. Nepal opposed the"left extremism of the UCPN(Maoist), the NC's status quo and the MJAF's national disintegration tendency." The convention elected Jhal Nath Khanal as CPN-UML Chairman by defeating K. P. Oli. His teammate Ishwor Pokhrel has been elected as the General-Secretary. Khanal expressed that his party is ready to lead the government but it will not be engaged in toppling the government. 3

News update from Nepal, 02 March 2009 Foreign Affairs On February 2, responding to the appeal of the Finance Minister Dr. Baburam Bhattarai to the Kathmandu-based donors agencies to support the stage of economic restructuring they suggested the government to make the best use of assistance, take the private sector into confidence, become transparent in public procurement, control the corruption, spend the development budget, prevent those people with criminal mentality from joining politics and maintain good governance. On February 5, a four-member German parliamentary delegation led by Dr. Wolfgang Thierse made a three-day visit to take stock of Nepal's political situation and discuss the development cooperation. The team advised the parties to unite for a statute. On February 11 the U.S. Assistant Secretary for South and Central Asian Affairs Richard Boucher held a consultation with key political leaders. The Prime Minister discussed the removal of the Maoist terrorist tag. He said,"The more they act within the political system and abandon the harsh practices of terrorism and violence, it will be easier for us to finish the review on the terrorist list." On February 15, speaking to Liu Hongeai, Deputy Chief of the International Department of the Chinese Communist Party, Prime Minister Dahal reiterated his commitment to the"One China Policy." During the Prime Minister's visit to China in April, bothgovernments committed are going to finalize a landmark Peace and Friendship Treaty, which would redefine the relationship between Nepal and China. On February 25, seven Tibetans who illegally entered Nepal were arrested by the police. In March, Tibetans are planning to observe their 50th Uprising Day while China is commemorating the golden jubilee of its direct rule on Tibet. On February 17, the visiting Indian Foreign Secretary Shiva Shankar Menon and Nepalese government authorities discussed the follow-up push to bilateral commitments. Economy On February 5, the Supreme Court gave the government the go ahead on the Voluntary Disclosure of Income Scheme(VDID) despite the warning by businessmen to launch a "non-cooperation movement" against the government's action. The government extended its deadline to one more month. It has collected$11.48m under this scheme. On February 16 the government has made public the names of 339 willful defaulters saying that they did not show up to repay their bank loans. The Asian Development Bank increased the loan and grants to Nepal from$100m in 2008 to$200m in 2009 due to the improvement in portfolio loans. India provided$1.867m for the construction of embankments along the Bagmati and other rivers. Japanese government provided$0.5321m for the construction of the Sinduli road Section III. On February 6, the Commission for the Investigation of Abuse of Authority recommended the higher authorities to control"corruption and illegal activities" among NGOs. Contact: Daniel.Reichart@fes.de, Tel.: 030- 26 935 769 4