UPDATE ON LATEST POLITICAL DEVELOPMENTS

NC BULIDING UP SUPPORT AHEAD OF BIG THREE SUMMIT
Kathmandu, 27 May: Main opposition NC President Sushil Koirala woke up Friday morning and launched a dialogue with the three-party Loktantrik Madeshbadi Morcha for the party’s 10-point conditions to support ruling communist party majority government’s proposal to extend a constituent assembly (CA) Saturday by one more year.
Koirala assured leaders of MJFL, TMLP and NSP Nepali Congress will be firm in its position in talks at the three-party summit later Friday at the peace ministry.
The party’s meeting with the ruling UML and UCPN (Maoist) was inconclusive Thursday.
NC has assembled a coalition of 16 parties against the government headed by Prime Minister Jhalanath Khanal.
Only 37 hours remain for the major parties to break a protracted political deadlock with the opposition adamant Maoists surrender weapons and present a credible schedule for integration and resettlement of 19,000 plus former fighters in 28 cantonments and satellite camps.
Opposition doesn’t buy the Maoist argument arms in containers have already been handed over and the combatants’ chain of command and control is with a special committee headed by the prime minister.
Maoist military commander Barsha Man Pun also argues at the same time handover of weapons and transfer of command would tantamount to surrender.
‘Now there’ll be no agreement on the basis of assurances. Everything should now be verified and implemented.
“The government is theirs, including the home minister. What’s the objection to the handover of weapons to government?
“We have presented the 10-point. They have presented their difficulties. The 10-point demand, including the handover of weapons, is our bottom-line,” Koirala said in an interview with Annapurna Post Friday.
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FURTHER DETAILS OF STRIKES

Kathmandu, 27 May: Normal life in the Valley was disrupted in the Valley with strikes called by various groups.
Four vehicles were torched or damaged in the capital where a strike was called by Chure Bhavar.
Groups pressing ethnic and regional demands closed down districts in east, central, west, mid-West and far-West districts.
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CASINOS, HOTELS SERVED NOTICES TO CLEAR DUES
Kathmandu, 27 May: Department of Revenue and Money Laundering Investigation has served, three-day ultimatum to both casino operators and hotels asking them to clear their dues, breaking its earlier practice of asking only to casino operators, The Himalayan Times reports.

Four casinos including Casino Anna, Casino Royale, Casino Nepal and Casino Fulbari haven’t cleared their dues,” director general Shanta Bahadur Shrestha said, adding that the department is putting its effort to collect dues.

The licence is issued in the names of Annapurna International of Casino Anna, Hotel Soltee of Casino Nepal, Hotel Yak and Yeti of Casino Royale and Hotel Fulbari of Casino Fulbari, according to him.

“Similarly, Casino Anna has been operated by Shivam Entex, Casino Nepal is operated by Nepal Recreation Centre, Casino Royale is operated by Gild International

and Casino Fulbari is operated by Hotel Fulbari itself,” Shrestha added.

“The department has already informed Nepal Recreation Centre that it will clear its dues through auctioning three ropanis of land and a house at Kalimati which is in Centre’s name,” Shrestha told The Himalayan Times.

Casino Nepal has informed the department that it has been closed since last five months.

“It has also asked the department to clear all dues from confiscated

assets of Nepal Recreation Centre,” Shrestha said, adding that Hotel Soltee – the licence holder of Casino Nepal — has also responded the department saying it is ready to take remaining liabilities after selling the propertries, if Nepal Recreation Centre (NRC) failed

to clear its dues.

Similarly, Casino Anna has also contacted department. “But Casino Fulbari and Casino Royale has not contacted so far,” he informed.

Meanwhile, the department has asked Ministry of Tourism and Civil Aviation to inform it the progress of action against those casinos that have failed to clear their dues.

“The department has requested the ministry to inform the progress according to the directives from Public Accounts Committee (PAC) under Legislature-Parliament,” Shrestha said.

The PAC had on December 28 directed the ministry to revoke licence of casinos that failed to pay their dues on time.
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EXPLOITS OF YOGENDRA MAN SHRESTHA
Kathmandu, 27 May: Wrongdoings of Yongendra Prasad Shrestha, former executive chairman of Nepal Share Market and Finance (NSM), are coming to light one after another, Prithvi Man Shrestha writes in The Kathmandu Post.
Shrestha, who figures in the most wanted list of the Police, has been found to have misappropriated around Rs 650 million without maintaining accounts, according to the details provided by NSM to the Nepal Rastra Bank (NRB).
Earlier, an NRB investigation had found that Shrestha used Rastriya Beema Sansthan (RBS)’s fixed deposit of Rs 200 million for purchasing rights shares. Now, it has also been revealed that Shrestha did not maintain accounts of Rs 160 million of Citizens Investment Trust (CIT) and Rs 40 million of the Nepal Army, among others.
Issuing a direction to his subordinates, Shrestha had asked them to renew the fixed deposit of RBS in paper and use the amount for purchasing rights shares.
The NRB investigation has already revealed that he had created fake loans worth Rs 1.57 billion to finance rights shares for him and his kin. His family holds a 40 percent stake in NSM. The company was planning to upgrade itself into a commercial bank and that it has already increased its capital above Rs 2 billion.
Banks and financial institutions that made inter-bank lending to NSM are Shrestha’s other victims. They have lent around Rs 700 million to NSM which may be at the risk.
According to details provided by NSM to the central bank, about a dozen banks, including Janata, Machhapuchhre, Rastriya Banijya Bank, Century, Mega and Kist among others, have lent to NSM. Of the total inter-bank loan, NSM has not maintained accounts of loans worth Rs 170
million.
Anil Shah, chief executive officer of Mega Bank, said his bank has lent Rs 50 million a month ago. Mega is confident that NSM will be able to return back loan as its asset size is bigger than its liabilities, he said.
Bankers say they will have to maintain provisioning of loans that went to NSM this year. KIST CEO Kamal Gyawali said his bank has provided Rs 13 million to NSM and he believes that he loan will be recovered sooner or later.
According to the NRB investigation, NSM provided loans worth Rs 200 million to its promoters in violation of the Bank and Financial Institution Act. The central bank directive says such loan is deductible from the capital fund of the bank or financial institution concerned. After the implementation of this provision, the company’s capital fund came down to 4 percent against the requirement of 11 percent. The central bank has already directed it to make provisioning of Rs 1.72 billion against the fake lending orchestrated by Shrestha.
With the revelation of misappropriation by Shrestha on a large scale, the central bank has directed NSM to carry out its independent due diligent audit (DDA). “Only after the DDA we can confirm whether the company will survive,” said a senior NRB official.
The central bank implemented prompt corrective action (PCA) on NSM in the second week of May for its failure to maintain adequate capital fund. Under PCA, the company has been barred from collecting deposits and making lending. It also cannot purchase additional fixed assets and its directors and staff will not get incentives and benefits for leaving the institution. The central bank has also banned NSM from adding more staff, promoting existing staff and increasing their salary.
NRB has already told the government to punish Shrestha as per the Banking offense Act and the Police is after him. The central bank has already frozen Shrestha and his family members’ bank accounts and lockers. Shrestha’s passport has also been seized.
Despite these problems, the company has been returning deposits every day on a small scale. The central bank has directed NSM not to return individual deposits exceeding Rs 200,000 with a view to protecting small depositors.
As per the notice issued by NSM a few days ago, it has deposits worth Rs 3.25 billion of common people and Rs 2.75 billion of loans which can be recovered. It also claimed that Rs 4.55 billion can be raised through the sale of assets belonging to Shrestha and his family and the recovery of loans.
As of May 24, it has returned around Rs 100 million to depositors and recovered loans worth around Rs 90 million.
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OPINION



CRISIS IS PART OF POLITICS





Kathmandu, 27 May: Politics is never smooth sailing. Politics does not move in a straight line but takes numerous curves. Crisis is a part of politics, and crises surface and resurface. The triumph of a politician depends upon the knack and ability to overcome a crisis and be ready to face a new one, Yuba Nath Lmsal writes in The Rising Nepal..
The present crisis in Nepal is a part of politics, and should be taken in a normal and natural way. It is during crises that politicians and leaders are tested. This is more so in a democratic polity. Democracy is a political system that is particularly beset with crises and challenges.
Decisions must be made during a crisis taking the will and sentiment of the people into account. In a democracy, different ideologies and interest groups vie for an upper hand and pursue their own policies to woo the people. The policies of a party or group may be in sharp contradiction of the policies of the other parties. In such a situation, compromises have to be made taking the interest of the people and the country above their partisan and personal interests.
Difficult transition
The present crisis and problems in our country should also be viewed in this light. Nepal is currently passing through a difficult transition period, where the old system is being replaced by a new one. Some discomfort, confusion and crisis have surfaced because we are not accustomed to such a big transformation from an old feudal, monarchical and unitary system to a modern, republican and federal democracy. In this process, the old system has collapsed while the new one has yet to be institutionalised.
Democracy is the common concern and desire of the people for which all of us fought years and even decades. So we cannot go against the basic tenets of democracy. However, a debate is raging over the form and model of democracy. Different parties hold different views on democracy. In fact, democracy, as interpreted by former US president Abraham Lincoln, is the polity of the people (owned by the citizens); for the people (the system works for the general welfare of the people); and by the people (the system in which the government is popularly elected). This concept fits all manifestations and versions. But this definition is also interpreted by different people differently.
Democracy is a system that must cater to the fundamental needs of the people. An election is an important part of democracy. But elections alone do not guarantee genuine democracy. Even during the partyless Panchayat system, elections were held at all levels to allow the people to choose their representatives. But was the Panchayat a democratic system? The elections then were stage-managed to seek democratic legitimacy.
Democracy is also not rhetoric but a mechanism to deliver the goods. Perhaps, this is one of the most fundamental objectives of a democratic polity. But rhetoric is more common in the politics of the developing countries and emerging democracies, and not much emphasis is laid on efficiency and perfection on the delivery side.
A lot of questions are being asked in Nepal at present about the most suitable model of democracy that would deliver the goods under our unique conditions. A proportionate electoral system and inclusive governance are accepted norms in present-day politics, and these principles are already in practice in Nepal. The proportionate electoral system adopted in the Constituent Assembly election held three years ago ensured representation of all sections and sectors of the people on the basis of their population. As a result, the people feel a sense of ownership of the political system.
Similar is the case with governance. In principle, the inclusive system of governance was accepted, and efforts are being made to put it into practice. This is a system that guarantees the participation and share of all at all levels of decision-making and in the process. This provision has been incorporated in the constitution and also in the laws, which has aroused a new sense of political awareness among the people. Now people of all sections and sectors are raising their voice vigorously for their rights and share in governance and the political process, which was not there before. This is a positive aspect of our new found political system.
A recent case in which a newly appointed minister refused to participate in the swearing-in ceremony also needs to be analysed from the perspective of increased political awareness. Jayapuri Gharti, a Maoist lawmaker who was appointed Minister for Women, Children and Social Welfare, refused to take the oath of office to protest against not having at least 33 per cent women’s representation in the cabinet. This may have happened due to wrangling in the party or something else, but she has emerged as a champion of women’s cause, and her role was well appreciated by women activists.
Earlier, there was no provision of having at least 33 per cent women’s representation at all levels of government. It was the Maoist party that raised this issue and got it incorporated in the constitution as there was no opposition from the other political forces.
These issues are part of politicking. And they should by no means be taken as a real crisis. Without a crisis, a country cannot move ahead and will always remain stagnant. The tendency of seeking easy answers and solutions to problems and avoiding crises will not lead the country forward. World history has shown that only those countries that have passed through serious crises have prospered. Be it Japan, Germany, the United Kingdom or even our own immediate neighbours, they overcame the challenges and marched ahead on the path of development and prosperity.
No easy solution
Japan and Germany were virtually devastated in World War II, and they were forced to sign humiliating treaties by the victors. But in the post-war period, the humiliation inspired them to work hard, and they finally emerged as economic superpowers. Even India and China have had bitter experiences in the past. India remained a British colony for long and China, too, underwent a similar experience. But today these countries have emerged as big powers capable of challenging the dominant world powers.
Nepal, fortunately, never had any experience of war nor did it undergo any humiliation under external rule. So even a minor problem is taken as a big crisis. The present transition is, thus, being seen as a big challenge. In fact, it is a part of transitional politics and can be resolved easily in a democratic manner. For this, we need patience and the courage to tackle the crisis in a democratic way.

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