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R&D Economic Research & Business Development

Date: October 23, 2009

Highlights

Unified (CPN) Maoist is prepared to take any kind of step to uphold 'civilian supremacy' but didn't state till what length the party is ready to go for this, a senior leader of the former rebel party said Thursday.

A three-member taskforce of the UCPN-Maoist, the Nepali Congress and the CPN-UML today made concrete progress on ending the protracted deadlock in the parliament after the taskforce leaders held intensive discussions on a new text of a consensual sankalpa prastav (stricture motion).

Home Minister Bhim Rawal on Thursday renewed his pledge to implement the much-ambitious Special Security Strategy that aims to tackle growing criminal activities in Tarai and some hill areas in eastern Nepal.

Nepal's government will run out of money in less than a month unless it can lift opposition protests in parliament by supporters of the country's former Maoist insurgents and pass a new budget, officials warned Thursday.

Finance Minister Surendra Pandey on Thursday expressed confidence that the Maoists would allow parliament to endorse the budget for the current fiscal year despite their continuous obstruction of its proceedings.

Nepali Congress (NC) Vice President Ram Chandra Poudel on Thursday said relations of NC leaders with Prime Minister Madhav Kumar Nepal have gone sour after his decision to promote Sujata Koirala to deputy prime minister.

Finance Minister Surendra Pandey said that government is planning three mega cities. He also informed that government is promoting developing activities in seven priority sectors.

The World Bank (WB) has agreed to provide a grant worth more than US$ 100 million (approximately Rs. 7 billion) to the government of Nepal for blacktopping of roads connecting remote districts of the country's far western and mid-western regions.

More than Rs. 1.10 billion deposited in the National Welfare Fund (NWF) has remained idle as nobody knows how to use it for the benefit of the workers.

Chief of the United Nations Mission in Nepal (UNMIN) Karin Landgren has asked the political parties of the country to respect the Comprehensive Peace Agreement (CPA) that was signed between the then Seven Party Alliance and the Maoists when the latter formally ended their ten-year insurgency in 2006.

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Kathmandu-based ambassadors of member states of the UN Security Council and the chief of the United Nations Mission in Nepal (UNMIN) are visiting two cantonments of the Nepal Army and Maoist combatants on Friday. UNMIN is coordinating the visits.

In an unprecedented move, the Supreme Court today empowered the Commission for the Investigation of Abuse of Authority (CIAA) to investigate ‘disproportionate property’ accumulated by public servants prior to 2002.

Nepali rupee weakened further against the US dollar by 55 paisa on Wednesday as the Indian currency recorded additional depreciation to its lowest in more than a week, amid soaring oil prices and gains of dollar against major currencies.

Finance Minister Surendra Pandey said that government is planning three mega cities. He also informed that government is promoting developing activities in seven priority sectors.

The 39-member LDC Group of World Trade Organization (WTO), including Nepal, is set to demand developed countries to live by their promise and open their markets under duty-free and quota-free facility for all LDCs as they promised at Hong Kong Ministerial meet by 2010.

Around 200 factories have been shut down indefinitely in Sunsari and Morang, according to Morang Industry Association, reports RSS.

Industrial entrepreneurs of Birgunj have asked the government for the construction of a thermal plant run by coal.

Migrant workers in Qatar will have to submit their identity cards to Qatarbased exchange companies as the central bank of Qatar has directed the exchange companies to receive ID cards with photographs.

Hinting that there will be no immediate chance of reopening Israeli market for Nepali workers, Israel has laid fresh conditions that require the involvement of third party and to measures to control fraudulent activities in the process of sending Nepali workers to Israel.

Union of Asian Alpine Associations (UAAA) organise its conference on October 23-25 in Hong Kong.

An Indian supersonic fighter plane on Thursday has violated Nepal’s sky in Darchula district in the name of patrolling Indian border territories. Nepal’s local officials and eye-witnesses have confirmed this violation.

Nepali Congress (NC) Morang is all set to purchase the historic land owned by first elected Prime Minister of Nepal BP Koirala in the name of the party.

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25-year-old Nepali convenience store clerk pocketed a customer’s $1 million winning lottery ticket, claimed the prize and skipped town, possibly back to Nepal, authorities said.

POLITICS: Maoists ready to go to any length to uphold 'civilian supremacy' Unified (CPN) Maoist is prepared to take any kind of step to uphold 'civilian supremacy' but didn't state till what length the party is ready to go for this, a senior leader of the former rebel party said Thursday. Maoist vice-chairman Narayan Kaji Shrestha 'Prakash', who was speaking to mediapersons in Janakpur, said that the ongoing efforts to forge consensus and end the prevailing deadlock will fail if other political parties do not agree to a House debate on what his party calls 'unconstitutional' move of the President on the Army chief row. He said that the failure of the political parties to 'institutionalize civilian supremacy' in the past led to the country falling under despotic rule repeatedly. Shrestha said that Maoists are in favor of a 'consensus government' that comes into being by respecting the mandate given by the people to their party in the elections. However, the remarks made by Shrestha was tame considering the direct admonitions by two senior leaders of the party on Wednesday. Maoist senior vice-chairman Mohan Baidya declared that there is no hope for consensus among the parties, as the pledges from political leaders for consensus in recent days were nothing but 'sweet talk'. He told a leading daily Wednesday that unless the common resolution proposal the three main parties are trying to come up with to end the ongoing political deadlock clearly condemn the president's move the "likelihood of consensus is next to nil". Baidya said there is no alternative to revolt for consensus and that the massive mass movement the party had announced it will organize after Tihar will now happen. Echoing the same views, Maoist senior leader Baburam Bhattarai said there is a slim chance of parties reaching a deal to end the ongoing political deadlock despite the ongoing efforts. Addressing a progamme organized by Samyukta Rastriya Janadolan Nepal at Banepa in Kavre district on Wednesday, he said the Maoists would launch a nationwide stir if the parties failed to reach an agreement before the Chhath festival. Source: www.nepalnews.com Date: 10/23/2009 3


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Parties inch closer to clinch deal A three-member taskforce of the UCPN-Maoist, the Nepali Congress and the CPNUML today made concrete progress on ending the protracted deadlock in the parliament after the taskforce leaders held intensive discussions on a new text of a consensual sankalpa prastav (stricture motion). The talks teams of the major parties would sit together on Sunday and iron out differences on the President’s move on the then army chief, Rookmangad Katawal. The Maoists have been obstructing the parliamentary business demanding that the President’s move to reinstate Katawal be discussed in the parliament. But the ruling partners have turned down the demand, saying the parliamentary regulations do not allow to do so. “We have inched closer to an understanding to end the political deadlock in the parliament,” Arjun Narsingh KC, NC spokesperson, told mediapersons following the taskforce meeting held at the UML’s parliamentary party office. The proposed new text of the sankalpa prastav states that the Interim Constitution has given the President the status of a constitutional head. “This parliament expresses its firm commitment to make the constitutional head further dignified and respectable. This parliament, through the sankalpa prastav, expresses its commitment to not repeat any mistakes in the future.” But the Maoist side wants the text to be more explicit than the revised draft proposal presented by the NC and the UML taskforce members. KC said they were determined in their earlier stance that no stricture motion should be passed by the parliament about the President’s move. He added that efforts were being made to include the concerns of the main opposition party and the ruling partners in the common sankalpa prastav. He also hoped that the parliamentary deadlock would end before October 27 when the parliament resumes its regular business after Tihar and Chhath break. He said top leaders of the three major parties would also hold a comprehensive dialogue after the three parties’ talks teams finalised the draft of the sankalpa prastav. Dev Prasad Gurung, taskforce member of the UCPN-M, said the new text of the sankalpa prastav had opened the door for an understanding. “This is more progressive than the last one submitted jointly by the NC and the UML,” Gurung said. But he was quick to add that it was not enough to end the deadlock. He said the new text of the sankalpa prastav should explicitly mention the President’s move to reinstate Katawal, who was sacked by the Prachanda-led government on May 3. Yuvraj Gyawali, a UML leader and member of the taskforce, said they were still working on “suitable language” to be incorporated in the consensual sankalpa prastav. “We have proposed parliament’s commitment not to repeat such incidents in the future,” Gyawali outlined the proposed text of the prastav to be tabled in the

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parliament for its approval. He said Sunday’s meeting of the three parties talks teams would fine tune the text. Source: The Himalayan Times Date: 10/23/2009 Home Minister vows to implement special security strategy again Home Minister Bhim Rawal on Thursday renewed his pledge to implement the muchambitious Special Security Strategy that aims to tackle growing criminal activities in Tarai and some hill areas in eastern Nepal. Addressing a special ceremony organised at the Nepal Police Headquarters in Naxal on the occasion of 54th Police Day, Home Minister Rawal assured that the Special Security Strategy has been prepared in a manner that will directly benefit various castes, ethnic and religious communities, gender and the people of the country as a whole. He said the security strategy is being implemented as per the government's commitment to end the culture of impunity, protect human rights and fulfill the desire of the people to live peacefully by improving law and order situation in the country. The home minister, however, said that the government alone won't be able to implement the Special Security Strategy. He said that new security plan will be successful in its objective to improve law and order situation in the country only if there is help and support from all political parties, rights organizations, civil society including all sections of the society. The Madhes-centric parties have been very critical of the government's plan to implement the new security strategy. They say that the police atrocities will grow in Tarai once the security strategy is implemented. Minister Rawal also directed the police force to whole-heartedly devote themselves in the service of the people and not feel intimidated by any kind of pressure or threats. Speaking at the programme, Inspector-General of Police (IGP) Ramesh Chand Thakuri directed police personnel to strictly maintain law and order in the country by not trampling upon the rights of the people. He also expressed commitment that the Nepal Police will work towards protecting the right of the people to live in peace and harmony under any circumstances. Nepal Police is celebrating the "Police Day", which marks the establishment of Nepal Police force in the country, all over the country today. The celebration will continue for three-days. On Wednesday, the Home Ministry issued a code of conduct for cops barring police personnel from using mobiles phone while on duty. The Home Ministry official said handling cell phone by security personnel during working hours affect their overall performance. 5


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The code of conduct issued to implement the ambitious Special Security Strategy also strongly discourages police personnel from listening to radio, prevents them from chatting with each other and with the public unnecessarily, engaging in anti-social activities in public places and handling weapons in wrong ways. They are also discouraged from smoking and drinking alcohol. Demonstrating bad conduct before public, damaging the reputation of the police organisation, using organization for personal benefits and remaining idle during duty hours are some other acts strongly discouraged by the code. Source: www.nepalnews.com Date: 10/23/2009

Nepal government running out of money Nepal's government will run out of money in less than a month unless it can lift opposition protests in parliament by supporters of the country's former Maoist insurgents and pass a new budget, officials warned Thursday. Parliament must approve this fiscal year's budget by the middle of November or face a likely shutdown of the administration, with the government unable to pay employees, Cabinet spokesman Sarada Prasad Trital said. The Maoist lawmakers have held up proceedings in the chamber for several months with protests against the president for rejecting the dismissal of the army chief by the previous Maoist-led government. The decision by the president, who officially commands the military, led Maoist leader Pushpa Kamal Dahal to resign as prime minister. A new coalition government took over in May. President Ram Baran Yadav had overruled Dahal's attempts to fire the army chief, saying they were unconstitutional. The Maoists accused the army chief of opposing the integration of thousands of former Maoist fighters into the national army _ a key component of a peace deal between the government and the rebels when they laid down their arms three years ago. The fighters are still in U.N.-monitored camps. The Maoists contested elections last year and emerged as Nepal's largest political party. Source: www.etaiwannews.com Date: October 22, 2009

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All work and no pay soon, says Pandey Finance Minister Surendra Pandey on Thursday expressed confidence that the Maoists would allow parliament to endorse the budget for the current fiscal year despite their continuous obstruction of its proceedings. The government's failure to pass the budget due to the ongoing parliamentary obstruction has forced it to stop paying the salaries of the ministers. Likewise, people associated with state agencies will also stop getting their pay. No government agency can spend more than one-third of the allocated budget until the budget is passed by parliament as per the Advance Expenditure Bill. The bill is endorsed by parliament on the day the budget is presented which allows government agencies to spend a third of the budget until it is passed after discussion at the house. The government has got approval to spend Rs. 85.49 billion as per the passed bill. However, Pandey said that the parliamentary obstruction would be lifted to pass the budget at least. "I have already talked to former finance minister Baburam Bhattarai and asked him to allow the budget to be endorsed," he said at the Reporters' Club. Pandey added that the government had not been able to pay the salaries of the ministers as their number had surpassed the expected 25-30 ministers. "The salaries of the Constituent Assembly members and the Maoists' People's Liberation Army housed in different cantonments will also be stopped from this month," he said. "The government will not be in a position to pay even the civil servants from next month." Pandey said that the government was facing pressure on recurrent expenditure (salary and operation cost) not in the development expenditure. Although the government's policy is to accelerate development expenditure this year, it had failed to get approval from the National Planning Commission for more than a third of the first-priority projects. Source: www.ekantipur.com Date: October 23, 2009 Poudel blasts PM over Sujata Nepali Congress (NC) Vice President Ram Chandra Poudel on Thursday said relations of NC leaders with Prime Minister Madhav Kumar Nepal have gone sour after his decision to promote Sujata Koirala to deputy prime minister. “NC leaders have been dissatisfied with the prime minister after he chose to promote Sujata against the suggestion of most NC central leaders,� said Poudel. Poudel arrived in Chitwan to address a condolence meeting organized on the 13th day of the demise of NC leader Chij Kumar Shrestha.

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Talking to mediapersons at Bharatpur Airport, Poudel said an abrupt decision on the part of the prime minister was not appropriate as NC leaders were holding meeting with the party president to resolve the issue of party´s leadership in the coalition government. He, however, said that NC leaders have good relations with all UML leaders even as the relations with the prime minister have been troubled. Poudel alleged that the UCPN (Maoist) was chiefly to be blamed for the political deadlock in the country. “There is a limitation to stage protest in the parliament,” he said. “It must be symbolic. The Maoists have no right to paralyze the country by obstructing the parliament indefinitely.” Poudel added that the unruly activities of the Maoists had pushed the country to a highly critical situation. NC Acting President Sushil Koirala also alleged that the political deadlock could not be brought to an end due to Maoist adamance. He argued that the Maoists must exercise flexibility to end the political impasse. Source: www.myrepublica.com Date: 10/23/2009

POLICY: Finance Minister positive budget will be passed The government will run out of expenses in less than a month unless it can lift opposition United Communist Party of Nepal (Marxist) protests in parliament and pass the budget for the fiscal year 2009-10. But finance minister Surendra Pandey is hopeful that the UCPNM will help pass the budget. “If they will not assist, their combatents in the UN-monitored camps — along with civil servants and parliamentarians — will also suffer,” he said addressing media at the Reporters’ Club in the Valley today. The parliament must approve this fiscal year’s budget by the middle of November or face a likely shutdown of the administration, with the government unable to pay employees. “We have already stopped the cabinet’s salary,” he said. The UCPNM lawmakers have held up proceedings in the parliament for a couple of months with protests against the president for rejecting the dismissal of the army chief by their government. They have been asking for the correction of the President’s move, which literally means the fall of incumbent Prime Minister Madhav Kumar Nepal-led government.

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The decision by the president — who officially commands the military — led Maoist leader and then Prime Minister Pushpa Kamal Dahal ‘Prachanda’ to resign. A present coalition government took over in May. President Dr Ram Baran Yadav had overruled Dahal’s attempts to fire the then army chief, saying they were unconstitutional.If the budget could not be passed, the government has to bring ordinance. “But there is no need to go through ordinance,” Pandey said suggesting the UCPNM to go to street “but not to obstruct parliament and let the budget pass.” He claimed that budget and Civil Supremacy is different issue. “Reinstatement of chief of army staff by president and budget is completely a different issue,” he tried to convince the former guerrillas. “Budget is an issue of public concern,” he added. Delay in passing the budget has creating problems, he said adding that ministers pay has already been stopped. Due to delay in passing the budget, government has been facing problems in development expenditure, he said adding that the trend will encourage spending of development budget at the end of fiscal year that should not happen.

What’s in Constitution? KATHMANDU: According to the Interim Constitution of Nepal, Article 96 Votes on Account: (1) Notwithstanding anything contained in this Part, a portion of the expenditure estimated for the financial year may, when an Appropriation Bill is under consideration, be incurred in advance by an Act. (2) A Vote on Account Bill shall not be submitted until the estimates of revenues and expenditures have been presented in accordance with the provisions of Article 92 and the sums involved in the Vote on Account shall not exceed one-third of the estimate of expenditure for the financial year. (3) The expenditure incurred in accordance with the Vote on Account Act shall be included in the Appropriation Bill. Mega Cities planned KATHMANDU: Finance Minister Surendra Pandey said that government is planning three mega cities. He also informed that government is promoting developing activities in seven priority sectors. “The government is bringing policies for maximum land utilisation, increasing self-reliance on agriculture, tourism promotion and using forestry for economic benefit,” he detailed. Revenue collection has been satisfactory so far, he said adding that the government is raking more revenue in comparison to last year

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Source: The Himalayan Times Date: 10/23/2009

WB to provide $100m grant for road project The World Bank (WB) has agreed to provide a grant worth more than US$ 100 million (approximately Rs. 7 billion) to the government of Nepal for blacktopping of roads connecting remote districts of the country's far western and mid-western regions. According to an official at the Ministry of Physical Planning and Works (MPPW), the government had asked the WB for US$ 175 million. The WB's support comes soon after the completion of the first phase of the Karnali Highway Blacktopping programme launched by the government last year. MPPW joint secretary Tulasi Prasad Sitaula said the WB's grant would be spent on blacktopping a 105-km stretch of the Karnali Highway. The money will also be used to blacktop the road joining the lower section of the Dungeshwor-Siyakot-Dailekh road located below the Surkhet-Jumla road, he added. Out of the Rs. 7 billion grant assistance, more than Rs. 1 billion will be used for blacktopping sections of the Karnali Highway and the rest will be spent on blacktopping roads joining the headquarters of districts like Jajarkot, Darchula, Bajhang, Myagdi and Jomsom, said Sitaula. "The government and WB officials are holding talks to decide the amount of the grant while the WB has already agreed to provide around Rs. 7 billion," he said. "All the road works will be completed within the next four years," he added. The WB has already provided a grant of US$ 40.2 million for the ongoing project of blacktopping the 127-km Surkhet-Khitkijhula section of the Karnali Highway in Kalikot district. "This road joining Surkhet and Khitkijhula will be completely blacktopped within this fiscal year," said Sitaula. It costs Rs. 10 million to blacktop one kilometre of the Karnali Highway, which is termed expensive compared to other roads in the country. Meanwhile, the Asian Development Bank (ADB) is supporting the construction of blacktopped roads in the country's eastern and central districts including Taplejung, Nuwakot, Ramechhap and Rasuwa under its Road Connectivity Sector programme, the MPPW stated. Likewise, the ADB is funding the blacktopping of a road joining Bhairahawa and Taulihawa in Kapilvastu district. Only four district roads in Khotang, Sankhuwasabha, Okhaldhunga and Myagdi will remain to be blacktopped after the programmes supported by the WB and the ADB

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are completed. Similarly, the roads joining the district headquarters of Manang, Bajura, Dolpa, Mugu, Humla and Solu will be the only ones remaining to be blacktopped. Source: www.ekantipur.com Date: October 23, 2009

Rs 1b welfare fund sits idle for lack of plan More than Rs. 1.10 billion deposited in the National Welfare Fund (NWF) has remained idle as nobody knows how to use it for the benefit of the workers. After realising the need to utilize the fund, the government has declared in the current budget that it will formulate short- and long-term programmes in coordination with national-level trade unions. However, the welfare committee of the NWF has not made any decision on how to utilise the fund. "We are thinking of introducing programmes only after recruiting the needed staff to operate and manage the fund," said Amal Kiran Dhakal, acting director general of the Department of Labour and a member of the welfare committee. According to the Department of Labour, they will need at least five persons including a manager. Dhakal said that as the fund was being raised from the workers, they needed to incorporate the ideas of the trade unions regarding how the money should be used. "We have received various suggestions from the major trade unions," said Barun Kumar Jha, member secretary of the welfare committee. He said that there was a study report about using the fund in health services and the hospital sector. Hari Dutta Joshi, a member in the welfare committee representing the General Federation of Nepalese Trade Unions said that the fund was not sufficient to be utilized in the hospital sector. "The money we have will be insufficient for hospitals, so we are discussing how best to use it," he said. "The fund has to be used in sectors which provides good results in the long term." The NWF was formed a decade ago under a provision of the Bonus Act 1974 to promote the welfare, rights and security of labourers. As per the act, every enterprise should distribute 10 percent of its net profit to the workers as bonus, and 30 percent of the remaining amount should be deposited into the NWF. Source: www.ekantipur.com Date: October 23, 2009

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Respect the peace deal U.N. tells Nepal Chief of the United Nations Mission in Nepal (UNMIN) Karin Landgren has asked the political parties of the country to respect the Comprehensive Peace Agreement (CPA) that was signed between the then Seven Party Alliance and the Maoists when the latter formally ended their ten-year insurgency in 2006. Ms. Landgren on Thursday met with Prime Minister Madhav Kumar Nepal and raised concern on the statement made by the Defence Minister Bidya Devi Bhandari who had recently said that the CPA needed amendment. “I raised the statements made by the Defence Minister,” she told reporters adding, “Our view is that the CPA needs to should be implemented by all the parties, and the parties should refrain from making any provocative comments.” The Prime Minister assured Ms. Landgren that the government was committed to the peace agreement. Ms. Landgren also expressed that the United Nations Secretary-General has been concerned by “the delays” in the peace process. She would be reporting to the Secretary-General in New York as the UN Security Council will be reviewing Nepal’s peace process in November. UNMIN has been assisting in Nepal’s peace process since 2007, especially by managing the Maoists’ arms and army personnel. It will be staying in Nepal till January 2010. The government has announced that the task of integrating and rehabilitating of the Maoists’ army would be completed before a new constitution is delivered, which is scheduled for May 2010. Source: beta.thehindu.com Date: October 22, 2009 UNSC member-envoys visiting cantonments Kathmandu-based ambassadors of member states of the UN Security Council and the chief of the United Nations Mission in Nepal (UNMIN) are visiting two cantonments of the Nepal Army and Maoist combatants on Friday. UNMIN is coordinating the visits. According to Kosmos Biswakarma, UNMIN spokesperson, the ambassadors and UNMIN chief Karin Landgren are visiting the cantonment of the Nepal Army at Chhauni in Kathmandu and a cantonment of Maoist combatants at Chulachuli, Ilam. A select group of editors are accompanying the ambassadors and UNMIN chief. The visits by the ambassadors come ahead of the UN Security Council (UNSC) meeting on Nepal´s peace process scheduled for November 3. The meeting is to review the peace process. Meanwhile, UNMIN chief Landgren called on Prime Minister Madhav Kumar Nepal on Thursday to express concern over slow progress in the work of the Special

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Committee for supervision, rehabilitation and integration of Maoist combatants. The prime minister is head of the committee. The committee has not met since September 17. The prime minister´s press advisor, Bishnu Rijal, said that the prime minister tried to call meetings of the committee twice after September 17 but could not do so as not all members of the committee were available. On one occasion Janardan Sharma, a member from the Maoist party, was not in Kathmandu while Jaya Prakash Prasad Gupta was not available at another time when also the prime minister tried to call a meeting, Rijal said. During her meeting with the prime minister, Landgren also expressed her concern over remarks made by some ministers against the Comprehensive Peace Agreement (CPA). "Both the government and the Maoists are responsible for full implementation of the CPA. No one should comment to make this difficult," she told journalists after the meeting. Recently, Defense Minister Bidhya Bhandari said that the Nepal Army would shortly begin fresh recruitment. Earlier in September, she had told a parliamentary committee that the CPA should be reviewed to allow the army to take fresh recruits as the CPA and the Agreement on Monitoring the Management of Arms and Armies do not allow the army or the Maoists to take new recruits. Source: www.myrepublica.com Date: 10/23/2009 SC asks CIAA to probe property In an unprecedented move, the Supreme Court today empowered the Commission for the Investigation of Abuse of Authority (CIAA) to investigate ‘disproportionate property’ accumulated by public servants prior to 2002. A five-member full bench of Justices Anup Raj Sharma, Ram Kumar Prasad Shah, Prem Sharma, Mohan Prakash Sitaula and Sushila Karki passed the judgment. The apex court also authorised the anti-graft authority to probe anyone attempting to hiding property during voluntary declaration of income sources (VDIS) scheme. Stating that the Corruption Prevention Act, 2002, has given its continuity in criminalising the accumulation of disproportionate property, the bench said the CIAA could take actions against those accumulating such a property. A division bench of Justices Damodar Prasad Sharma and Rajendra Prasad Koirala had referred to the case Ishwor Pokhrel vs CIAA in the full bench, raising legal question as to whether the 2002 Act was a continuation of the 1960 Act or not and whether one could be investigated even after paying tax under the VDIS scheme. Pokhrel was convicted by the Special Court and was sentenced to a one year jail term and fine of Rs 3 million. The CIAA, however, had moved the apex court, stating that the Special Court punishment on Pokherl, an under secretary at the Custom Department, was insufficient.

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In order to make the anti-graft body more strong, the parliament had promulgated the existing Act in 2002 replacing the 1960 Act. The Section 20 (1) of the Act has stated that if a public servant failed to produce a legitimate source of income while submitting his property details, he or she would come under the scanner. The same would apply to a public servant whose lifestyle has unreasonably and inappropriately changed through the income accumulated through bribery and corruption. The apex court has also authorised the anti-graft body to prosecute a civil servant who hides property in the process of voluntary disclosure of income details. Giving his observations on the verdict, CIAA Commissioner Beda Prasad Siwakoti welcomed the move of the Supreme Court saying that it was a “positive development” in the anti-corruption movement being launched in the country. "The Commission for the Investigation of Abuse of Authority has finally been empowered to deal with disproportionate property accumulation and property hiding," Siwakoti added. Source: The Himalayan Times Date: 10/23/2009

BANKING: Rupee further weakens Nepali rupee weakened further against the US dollar by 55 paisa on Wednesday as the Indian currency recorded additional depreciation to its lowest in more than a week, amid soaring oil prices and gains of dollar against major currencies. Accordingly, Nepal Rastra Bank, the central bank of the country, has fixed the selling exchange rate of partially convertible rupee at 75.12 per US dollar for Friday while the exchange rate was fixed at Rs 74.55 per US dollar on Thursday. Similarly, the buying rate of a US dollar has been fixed at Rs 74.52 for Friday whereas it was Rs 73.95 per dollar on Thursday. Since Nepali rupee maintain a fixed exchange rate with Indian currency, any fluctuations seen in the Indian currency is directly reflected in the exchange rates of Nepali rupee with other convertible currencies. According to international news agencies, the weakening of the Indian currency against the US dollar was mainly due to rise in the dollar index, a gauge of the US unit´s performance versus six majors. Source: www.myrepublica.com Date: 10/23/2009

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BUSINESS & ECONOMY: Fulfill duty-free facility promise by 2010: LDCs The 39-member LDC Group of World Trade Organization (WTO), including Nepal, is set to demand developed countries to live by their promise and open their markets under duty-free and quota-free facility for all LDCs as they promised at Hong Kong Ministerial meet by 2010. At the 7th WTO Ministerial Conference scheduled for November 30-December 2, 2009, the LDC members will also raise a strong voice for the elimination of all forms of non-tariff barriers on their exports and extend meaningful aid for trade and technical assistances to the LDCs. The group that met in Dar Es Salaam on October 14-16 as a part of the WTO Ministerial preparatory exercise has adopted a 84-point declaration, which represents LDCs unified voice on world trade issues. They also, for the first time, came up with a common position over issues of subsidies, market access and aid.“ "The declaration seeks greater opening of developed countries´ markets, elimination of non-tariff restrictions and also special and differential treatment for LDCs -something that developed WTO members have long-committed, but never implement”d," Commerce Secretary Purushottam Ojha told myrepublica. As a part of the declaration, LDCs at the ministerial conference will urge WTO members to implement duty-free and quota-free market access facility pledged to them, stop restricting agriculture trade, open job markets and support trade facilitation. They will also voice out on issues like LDC accession to the WTO, trade and environment, increased support under Enhanced Integrated Framework (EIF) and aid for trade-related infrastructure development and trade growth“ "The declaration will be forwarded at the Doha negotiations as a common stand of LD”s," said another official at Ministry of Commerce and Supplies, elaborating that the declaration also urges the development partners to move quickly in concluding negotiations and implement outcomes of Doha negotiations. The Doha talks, launched in late 2001 to render international trade regime fair to all and pro-poor by slashing farm subsidies and agricultural and industrial tariffs, is suppose to come to an end in 2010. However, given the deadlock of the past and ever existing differences among developed and developing countries on tariff cuts for industrial goods, generally referred as non-agriculture market access (NAMA), experts doubt the successful conclusion of Doha Round by next year. While urging the developed countries to eliminate agricultural subsidies, WTO LDCs, during the Dar Es Salaam meet, also expressed their wariness over possible adverse impact of cut on industrial tariff on their trade.“

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"For instance, in certain countries and regions such as the EU, where LDCs are enjoying duty-free facility, higher tariff is serving us as a special cushion against our rivals. But, as the cut in tariff will erode this preference and make us Disproportionately Affected Countries, we are seeking developed members to put in place special preferential arrangements for LD”s," said the official. LDC members will also urge the WTO developed members to lift all export restrictions on food items imported by developing countries to ensure food security. Source: www.myrepublica.com Date: 10/23/2009 Factories in Morang, Sunsari shut down Around 200 factories have been shut down indefinitely in Sunsari and Morang, according to Morang Industry Association, reports RSS. Among the closed factories, 50 are big, 150 middle and 50 small ones. “Most of the industrial units were closed in the wake of deteriorating peace and security condition, however remaining were shut down due to strikes, labour problem, lack of market, skyrocketing prices of raw materials and shortage of electricity”, said Somnath Adhikari, officer at the Morang Industry Association (MIA). “We have repeatedly requested the government to resolve all these problems but it did not show any concern forcing the factories to shut down,” he added. “These factories could help boost market and increase export provided they are allowed to operate smoothly,” Adhikari said adding that around 10,000 Nepalis will immediately get employment, if these industries resume operations. Crescent Nepal had established a big factory at Bhamari of Sunsari but it was closed before starting its operation due to forceful donation and threats since its foundation stone was laid. According to the association, though the security situation has improved lately, the factory owners did not want to take risks because of electricity crisis. The closure of industries has also affected some banks putting their investment at risk. Source: www.nepalnews.com Date: 10/23/2009 Urge to make thermal plant PARSA, OCT 23 - Industrial entrepreneurs of Birgunj have asked the government for the construction of a thermal plant run by coal.

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The entrepreneurs participating in an interaction to solve the problems caused by load shading asked Minister for Energy Dr. Prakash Sharan Mahat to construct a thermal plant in Birgunj. Chairman of the Entrepreneurs Association Om Prakash Sikaria expressed his view that if the government managed a thermal plant which runs by coal as the alternative of hydroelectricity, the nation could get relief from load shedding. Source: www.ekantipur.com Date: October 23, 2009 Workers in Qatar required to produce ID DOHA, OCT 23 - Migrant workers in Qatar will have to submit their identity cards to Qatar-based exchange companies as the central bank of Qatar has directed the exchange companies to receive ID cards with photographs. As per the Qatari central bank's directive, the workers will have to submit photocopies of the ID card provided by the Qatari Interior Ministry which is called "Pataka". Remittance companies involved in sending remittance to Nepal said that a driving license, health card or passport with visa could also be submitted in place of the ID card. They said that the Qatari government might have introduced such a policy in order to control illegal stay of migrants in Qatar and find out an individual's income. There are around one and half dozen banks and money transfer companies in Qatar that help Nepali migrant workers to send money home. Jitendra Pandey, chief of International Money Express (IME), a money transfer company for Qatar, said that the bank had already placed a notice on the counter regarding the need for ID cards and telephoned the customers about it. They have also been providing photocopy services to the customers. Senior representative of Himalayan Bank Rameshwor Shrestha said that they had been informing their customers about the latest provision. Source: www.ekantipur.com Date: October 23, 2009 Israel seeks third party involvement in recruitment Hinting that there will be no immediate chance of reopening Israeli market for Nepali workers, Israel has laid fresh conditions that require the involvement of third party and to measures to control fraudulent activities in the process of sending Nepali workers to Israel, a highly placed source at Ministry of Foreign Affairs said.

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Despite strong diplomatic exercise from Nepali officials to reopen Israel jobs, which have been closed for the last seven months, the Israeli side seems to be in no mood to welcome Nepali workers soon. Israel has stopped accepting Nepali workers expressing serious concern over widespread irregularities in the sending process, including exorbitant fee by manpower agencies, involvement of Nepali workers as agents in Israel and low skill of Nepali workers. Israel recently sent official response to the government through Nepali Embassy in Tel Aviv, two months after a high-level Nepali delegation led by Labor Minister Mohammad Aftab Alam visited Israel to put diplomatic pressure to lift the ban on Nepali workers. “Israel has sought the involvement and monitoring by a third party, possibly International Organization for Migration (IOM), and measures to control rampant irregularities and malpractices in the process,” the source added. “We will hold discussions on the Israeli response with the officials of the Ministry of Labor and Transport Management on Friday.” Israel forwarded the names of 16 Nepali manpower agencies promoting malpractices in the sending process 18 months before and requested the government to take strong action against them. Israel had also urged the government to put in place strict mechanism to control malpractices in the sending process. The Israeli side had also suggested making embassies of both the countries more effective and vigilant in identifying agencies involved in malpractices and bringing them to book. It has also suggested delisting such agencies from the roster of approved agencies. Though the government has fixed service charge to arrange jobs in Israel at Rs 240,000 per person, manpower agencies used to collect two to three times more than the fixed rate, saying that they have to pay exorbitant commission to Israel-based manpower agents. Israel -- home to more than 12,000 Nepali workers -- is popular among Nepali women workers who are mostly employed as caretakers. However, Nepali officials have not taken any action against the agents stating that investigations against them were on. During Alam´s visit to Israel, Israel´s Deputy Prime Minister and Interior Minister Eliyahu Yishai had drawn Nepal´s attention on rising incidents of overcharging or landing workers in Israel on flying visa. With the closure of fresh working visas and cancelation of over 400 issued visas for Nepali workers, investment of more than Rs 500 million by Nepali manpower agencies and job seekers has become uncertain. Source: www.myrepublica.com Date: 10/23/2009

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Asian Alpine Association to meet from today Union of Asian Alpine Associations (UAAA) is going to organise its conference on October 23-25 in Hong Kong. The representatives from Japan, Korea, China, India, Pakistan and Singapore and more than 25 nations conference will be participating in the conference that will also form a new working committee. According to Ang Tsering Sherpa, president of UAAA, the conference will also discuss on mountaineering tourism and activities to bring effectiveness in tourism reducing negative impacts to the environment. “Targeting Nepal Tourism Year 2011 (NTY 2011), Nepal Mountaineering Association (NMA) has insisted to organise the International Mountaineering meet in Nepal.” International Mountaineering Association has 178 nations as its member and during its conference at Portugal NMA has urged to organise its next conference in Nepal during NTY 2011. On the occassion Sherpa informed about the growing environmental disorder and its impact on the high Himalayas and also urged to take possible steps to minimise its impact on the Himalayas. “Due to climate change glaciers are melting posing a threat to ice lakes that could blast and cause loss,” he said adding that they are planning to organise some programmes at the high risk area like Mount Everest Region to avoid the disaster. Source: The Himalayan Times Date: 10/23/2009

GENERAL:

Indian fighter plane over Nepali sky An Indian supersonic fighter plane on Thursday has violated Nepal’s sky in Darchula district in the name of patrolling Indian border territories. Nepal’s local officials and eye-witnesses have confirmed this violation. According to Radio Mirmire, Darchula-based Nepali security posts admitted that the Indian airforce had violated international treaties by randomly flying into Nepal’s territories. Nepal government’s official comment is yet to come out. India, though it officially has not claimed yet, frequently treats Nepal as one of its Himalayan provinces. The Nepalis, for decades, have been making a regular objection to this colonialist practice of India.

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After 17-year-long collaboration with Russia, India had been able to produce a fighter plane of its own in 2001 Source: www.groundreport.com Date: October 22, 2009 NC to purchase BP Koirala's land Nepali Congress (NC) Morang is all set to purchase the historic land owned by first elected Prime Minister of Nepal BP Koirala in the name of the party. BP´s sons Prakash, Shreeharsha and Dr. Sasanka Koirala and daughter Chetana had taken advance payment of Rs. 3.5 million to sell the ancestral land (8 kaththa 13 dhur) of Biratnagar sub-metropolis-9 to Birat Housing Company in around 500 millions, informed NC Morang president Amrit Aryal. The party announced to purchase the historic asset claiming NC´s moral right on the area where three sons of ideal father late Krishna Prasad Koirala - Matrika, Bisheswor and Girija - were brought up and had sowed the seed of politics to bring the nation to this stage, added President Aryal. He also announced to purchase the land by raising fund from the leaders and cadres associated to the NC across the country and pledged to turn it into a museum in the name of these political giants. President Aryal informed that he would flare up the issue of ancestral land in upcoming Mahasamiti meeting of the party to prevent its sale to the Housing Company at any cost and added it is the shared responsibility of entire NC cadres to preserve and protect the historically important area. NC Morang President Aryal also called on all leaders and cadres of the NC to get united to materialize this campaign which will serve greater significance in coming days. Source: www.myrepublica.com Date: 10/23/2009 Lottery prize theft slur on Nepali 25-year-old Nepali convenience store clerk pocketed a customer’s $1 million winning lottery ticket, claimed the prize and skipped town, possibly back to Nepal, authorities said. Pankaj Joshi took 67-year-old Willis Willis’ winning Mega Millions megaplier ticket after Willis asked Joshi in May to check whether any of his numbers were winners, investigators said in a search warrant affidavit last month. Joshi claimed the prize - about $750,000 after taxes - at the lottery claim centre in Austin, had the money wired to a bank account and disappeared, authorities said.

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“Never to this degree have we seen a clerk steal a megaplier winning ticket,” assistant district attorney Patty Robertson said on Wednesday. Nick Parveez, Joshi’s former manager at Lucky’s Food Store in Grand Prairie, near Dallas, called the lottery commission in July to voice his suspicions about Joshi after hearing that his store sold a $1 million winning ticket, according to the affidavit. No one at Lucky’s had ever seen Joshi play the lottery, assistant manager Mike Rahman said. “He just left,” Rahman said. “We were shocked. We didn’t know he could do anything like this.” Joshi, who was a student at the University of Texas at Arlington and had worked at the store for five years, was charged in Travis County in September with one count of claiming a lottery prize by fraud. If convicted, he could face up to 20 years in prison. A judge set Joshi’s bond at $10 million. The Austin American-Statesman first reported on the charge on Wednesday. Joshi transferred some of the money to various bank accounts after the initial deposit by the lottery, prosecutors said. Authorities have recovered $365,000 from Joshi’s account. It wasn’t clear when the money might be returned to Willis, if it’s proven in court to be his. Investigators believe Joshi may have returned to Nepal. When he quit his job in June, Joshi said he was returning to Nepal to help his cousin with her perfume business, Parveez told investigators. Willis, a regular customer at Lucky’s, said he played the lottery two to three times a week using a set batch of numbers. He said he bought $10 worth of Mega Millions megaplier tickets on May 29 for that night’s drawing, according to the affidavit. Willis told investigators he went to the store two days after the drawing to check the results because he hadn’t been able to find the winning lottery numbers on television or check them in the newspaper. Investigators used the lottery transaction system to see if the winning ticket had been scanned and found it was checked on May 31. An inspection of the store’s check processing computer found that Willis had cashed a cheque at the store and purchased lottery tickets two days earlier using set numbers. Willis also produced a lottery play slip showing the winning numbers. Texas Lottery Commission officials are probing the matter. Spokesman Bobby Heith referred questions about the case to the district attorney’s office. He said the lottery recommends players sign the back of their tickets when they buy them in case of loss or theft. Rahman said even though Willis is upset about the loss, he still buys lottery tickets at Lucky’s. Source: The Himalayan Times Date: 10/23/2009

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