Internal Political Developments

House Back to Business after the Government Backtracks from its Decision to Legalise Conflict-era Land Transactions; Baidya Faction Demands Prime Minister Dr. Bhattarai’s Resignation: Along with the government's decision to backtrack from its decision to legalise conflict-era land transactions, the opposition parties on February 9, 2012 allowed Legislative-Parliament’s business to be resumed. The Nepali Congress and the CPN-UML had been blocking parliamentary proceedings for 23 days since January 17, 2012 demanding the government to scrap the decision.

In fact, the opposition parties agreed not to disturb the House session when the Prime Minister Dr. Baburam Bhattarai agreed to announce Cabinet’s decision to scrap its earlier decision in the House. Addressing the House session on February 9, 2012, Prime Minister Dr. Bhattarai announced that the Cabinet's decision of January 12, 2012 was "no longer in existence." In his 16-minute address, Prime Minister Dr. Bhattarai claimed the decision to legalise the transactions was taken with a 'good intention' and that the government had revised its decision to end the stalemate. "By considering the stay order issued by the Supreme Court and the parliament obstruction by the opposition parties, today's Cabinet has decided not to keep the decision in existence any longer. The decision will not be implemented," Prime Minister Dr. Bhattarai said.

However, the government avoided using the term “withdrawal” but adopted somewhat ambiguous language in the text of the decision even though it was under pressure from opposition parties to include the term 'withdrawal'. That is why, the opposition parties cautioned the government against similar 'misadventure' in the future even though they welcomed government's decision. It is said that the government decided to use soft language to avoid drawing the ire of Maoist hardliners who had instructed Prime Minister Dr. Bhattarai and the party leadership to stick to the decision. While addressing the House session, Bhattarai even promised to offer an alternative to the peasants and expressed hope that his commitments would satisfy agitating lawmakers. However, Bhattarai seems to have become unable to convince the hardliner faction of his own party led by Vice Chairman Mohan Baidya. It is because the Baidya faction demanded Prime Minister Bhattarai step down in the party’s Standing Committee meeting which was convened immediately after the Cabinet decision to scrap the transactions. According to the Maoist party Secretary CP Gajurel, the Baidya faction demanded that the party leadership should call back party Vice Chairman Bhattarai from the post of Prime Minister.

Prime Minister Dr. Bhattarai has been under intense pressure from his party—United Communist Party of Nepal-Maoist (UCPN-M)—to resign. One the one hand, the hardliner bloc of the party seemed discontent with each and every step of the government. On the other, the establishment faction—led by party Chairman Pushpa Kamal Dahal has been almost silent on the issue. Interestingly, it was Chairman Dahal who had proposed for forming a national consensus government time and again in the past. That is why, it is said that the Maoist leaders have advised their Chairman Dahal to be more clear about the party’s position on the future leadership.

Maoist Combatants' Discharge Process Completed with Many Hindrances: The process of discharging the former Maoist combatants who have opted for voluntary retirement by providing them the first instalment of the cash package was concluded on February 11, 2012. It was the process which began by high level Army Integration Special Committee on February 3, 2012. The task of handing over cheques to the Maoist former combatants opting for voluntary retirement has now been concluded.

It is reported that 7,200 out of the 7,365 retiring combatants have received cheques --equivalent to Rs. 1.97 billion. According to Committee Coordinator of Secretariat of the Special Committee for the Supervision, Integration and Rehabilitation of the Maoist combatants Balananda Sharma, the task of handing over cheques in all the seven camps and satellite camps having been completed, arrangements have been made for distributing cheques to those fighters who were left out during the first-phase of distribution through the Secretariat in Kathmandu. Along with this progress, the Special Committee decided to reduce the number of Maoist cantonments to a half. A Special Committee meeting was held on February 12, 2012 took the decision to this effect. The committee has also formed a five-member taskforce headed by committee secretariat member Ramananda Mishra and asked to submit its report within the next seven days. As everybody knows, there are currently 28 cantonments across the country.

In the meantime, the Special Committee has directed its secretariat to look into the reports of confiscation of cheques handed over to the former Maoist combatants opting for voluntary retirement. It was reported that the commanders of Maoist People’s Liberation Army (PLA) had snatched cheques received by the combatants opting voluntary retirement saying that 40 percent of the cash package should be given to the party. It is reported that the Baidya faction urged Dahal to scrap the policy to take the cut from the combatants. However, it was Party Chairman Dahal who had instructed PLA chief Nanda Kishor Pun to collect the cash from the combatants who opted for voluntary retirement. “Dahal and some PLA commanders had decided to take a certain amount of the money without holding discussions with us. We have urged them to cancel such a policy,” said Maoist Standing Committee member Netra Bikram Chand.

In fact Maoist party had to face hurdles from its sister wings after the much-awaited farewell process of the retiring combatants began. Initially the disqualified Maoist combatants tried to disrupt the farewell process. Then, the disabled combatants refused to receive the cheques, demanding the government also provide them with free treatment and free schooling for their children. And eventually the situation became very complicated when members of the Young Communist League (YCL), the youth wing of the UCPN-M padlocked party offices in nine districts of the Far-Western region on February 6, 2012, demanding facilities on a par with PLA combatants. They also demanded relief and rehabilitation packages for its disabled members and integration of “interested” YCL members in the Nepal Army. According to YCL members, their role was no different than that of the PLA during the insurgency, and they had left the PLA to join the YCL only after the party leadership had promised them relief and rehabilitation packages that the PLA combatants would be getting.

In the meantime, cadres of YCL have called off the protest after the mother party agreed to consider their demands. They called off the protest programmes after a meeting with Finance Minister and Maoist leader Barsha Man Pun and PLA Commander Janardhan Sharma ‘Prabhakar’ on February 7, 2012. According to reports, the meeting had decided to form a concrete action plan for the YCL administration and hand over a certificate of ‘People’s Liberation Army’ to the PLA combatants who had joined the YCL. On the same day, a Standing Committee meeting of the Maoist party decided to provide cash incentives to YCL members who were originally taken in the organisation from the PLA. It is said that the party will require millions of rupees to pay the YCL cadres. It is the Maoist party which has collected levies from the monthly salaries of 19,525 combatants for the past six years. Also the UCPN-M has bagged more than 2 billion Nepali Rupees from the state coffers in salaries and rations by producing fake figures exceeding the actual number of combatants cantoned in the various temporary camps.

Minister Gupta’s Remark Creates Controversy: The remark made by the Minister for Information and Communications Jaya Prakash Gupta who is also the Chairman of the Madhesi Janadhikar Forum-Gantantrik has once again created controversy in Nepali political discourse. Even President Ram Baran Yadav has put forth his concern over Minister Gupta’s statement that the Madhes could break its ties from the nation. It is reported that President Yadav, during a meeting with Prime Minister Baburam Bhattarai , requested him to talk with Gupta about his remarks. “It is not ethical for a minister to give such remarks. This is against the nation’s integrity. Talk to him about the issue,” President Yadav said.

In fact, Minister Gupta, talking to a select group of journalists at the Ministry on February 7, 2012, had warned that the Madhes could sever its relationship with the state if the issues of the region are not addressed. He also had claimed that a revolt is brewing in the Madhes due to the haughty attitude of the major parties towards the region. “I have visited various Tarai districts in the past two months and found the people there are quite dissatisfied,” said Gupta. He added that the Madhesi people have been disgruntled with the government, political parties, media, judiciary and the constitutional bodies. “Fresh relations had been established between the Madhes and the state with the signing of various pacts. But the distance between Kathmandu and Madhes is growing due to non-implementation of those agreements,” Minister Gupta said. Before Gupta’s statement, Prime Minister Baburam Bhattarai’s statement on the possibility of “submerging” of Nepal into neighbouring countries had also created controversy. While briefing media persons after the official visit of Chinese Prime Minister Wen Jiabao last month, Prime Minister had remarked that there was danger of Nepal getting submerged into India and China if the country failed to make economic progress.

In the meantime, former Minister and senior leader of the Madhesi Janadhikar Forum-Loktantrik Sarat Singh Bhandari, who was dragged into controversy earlier for his remarks, has once again renewed his controversial remarks regarding secession of Tarai districts. Addressing a party programme in Birgunj on February 6, 2012, Former Minister Bhandari said Madhes will dissociate from Nepal if Madhesi people are disregarded. He is one, who was compelled to quit as Defence Minister for his remarks that the 22 districts of the Tarai region would dissociate from Nepal if they were disregarded.

Foreign Relations

Relations with India

Nepal-India High Level Water Resource Meeting to be Held in Delhi: Nepal and India agreed to hold a first-ever Nepal-India energy minister-level talks in New Delhi from February 15, 2012. This is the highest mechanism in a tier-three structure of Joint Secretary, Secretary and Minister levels to look into water resource issues. The energy minister is leading the Nepali delegation. On the eve of the meeting, senior officials at the Ministry of Energy of Nepal have sought official position of the ruling UCPN-M on implementation of the Pancheshwar Multi Purpose Project, a part of Nepal-India Mahakali Treaty. It is the ruling Maoist party that has been demanding its scrapping, terming the Mahakali Treaty as "anti-national". The party, in its 40-point agenda submitted to the then Prime Minister Sher Bahadur Deuba in 1996 at the onset of their 'People's War and various other platforms, has been warning against the implementation of the project.

It is assumed that India may to raise the issue of implementation of the Pancheshwar project and formation of the Pancheshwar Development Authority (PDA). The ministerial-level meeting is also likely to review and explore the entire gamut of issues related to resources, including power import, inundation, hydropower generation and cooperation, construction of cross-border transmission lines, and Sapta Koshi Multi Purpose Project cum Sun Koshi Diversion Scheme. "Our prime agenda is to import 200 MWs electricity from India and to expedite the construction of the 400KV cross-border transmission corridor to be built between Dhalkebar-Muzaffarpur," media quotes an official of Ministry of Energy of the government of Nepal as saying.

In the meantime, Indian Ambassador Jayant Prasad stated that an agreement to be signed between India’s Ministry of External Affairs and the Power Grid in New Delhi next week would pave the way for exporting power from India, thereby mitigating Nepal’s power crisis. He also revealed that Nepal and India are in discussions to materialise Indian Prime Minister Manmohan Singh’s visit in an opportune time in the near future. Envoy Prasad, while inaugurating a documentary entitled ‘Relationship and Development’ at the Reporters’ Club, on February 10, 2012, stated that the framework of the Nepali constitution is more or less ready. “I am hopeful that the remaining tasks of integrating the Maoist combatants and drafting the new constitution will move forward because there is no alternative to it,” he said. Referring to international examples, the ambassador ruled out the possibility of getting a “fine print” of constitution in one go, and said that democracy and federalism are very difficult to evolve.

Relations with China

China to provide Two Aircrafts on Grant, and Other Five on Soft Loan: China has agreed to provide seven aircrafts-two aircraft on grant and other five on soft loan--for the Nepal Airline Corporation (NAC). According to reports the Chinese Ambassador to Nepal Yang Houlan has informed about it during his meeting with Finance Minister Barsha Man Pun on February 10, 2012. As per the information, China will provide 19-seater Harbin Y-12 and 58-seater MA60 turboprop aircraft on grant that would arrive at the earliest. It is said that Nepal had requested for eight aircraft whereas the two sides finally agreed on seven. According to NAC, the aircraft to be available on soft loan basis will cost between Rs 5 million and Rs 15 million, depending on their capacity. The interest rate on the concessional loan will be 1.75 percent.

The NAC, which has a limited number of aircrafts that adversely impacts its market share, says if it gets more aircraft, it will be able to compete with private airlines and expand its services to more profitable sectors. Currently, it has no single flight on trunk routes with high profitability. As of now, it is reported that the NAC holds a mere three percent market share in domestic and 4.8 percent in international operation due to its limited number of aircraft. Out of six Twin Otter planes NAC has, only three are in operation.

By Uddhab Pyakurel