Home Minister resigns, DPM takes over

By Sanjeev Ghimire

Kathmandu Sept 29 - Beleaguered Home Minister Govinda Raj Joshi stepped down from his powerful position Friday, bowing to intense pressure in the aftermath of the killing of 22 policemen in rebel raids during the week.

A tired looking Joshi announced his resignation at a packed press conference at the Home Ministry Friday evening. Wiping away a tear or two, and delivering a long rambling speech, the Nepali Congress stalwart implicitly blamed the Royal Nepal Army and party colleague and former Prime Minister Sher Bahadur Deuba for the troubles facing the nation.

"I am tendering my resignation because I cannot raise the issues from this position," Joshi said, referring to the army's alleged non-cooperation and divisions within his own party. "Also, I wanted to step down to facilitate the work of a government committee which is probing the incident at Dunai."

Joshi's resignation was swiftly forwarded by Prime Minister Girija Prasad Koirala to His Majesty King Birendra. By late evening, the Royal Palace announced that the resignation had been accepted on the Prime Minister's recommendation and that Deputy Prime Minister Ram Chandra Poudel had been given charge of the Home portfolio.

The outgoing minister's resignation, and the outbursts against the army and Deuba, was precipitated by yesterday's statement by eight NC leaders, including Deuba, who demanded Joshi's resignation on moral grounds for failing to provide security in Dolpa and Lamjung districts where a total of 22 policemen were killed by Maoist rebels this week.

"If the terrorists are not overpowered such incident can occur daily. Can the government function if the Home Minister resign every time (the insurgents strike)?" he asked.

Joshi also lashed out at the Royal Nepal Army for failing to provide committed munitions thereby indirectly aiding in the Dunai carnage. "Had the police received arms from the army the Dunai incident could have been averted," he said. "Despite a Rs 170 millions agreement reached between the army and the police to provide arms for the police, the weapons were not provided."

He added that the army declined to provide the weapons to the police saying that they were incapable of operating them. He said the Maoist problem could only be solved if the army cooperate with the Home administration.

"Such a problem can only be resolved with cooperation from all the sides," he said. "Seeking army assistance doesn't mean that military rule will be implemented. What I mean is that army should not dodge the fight against terrorism."

As for the statement by Deuba and seven other NC leaders issued yesterday, Joshi was critical. He specifically targeted Deuba for aiding the rebels rather than the government. He charged the group with trying to capitalize on the grave situation as well.

"(Deuba) speaks more like a representative of the Maoists rather than that the government," Joshi alleged.

RNA dutiful to government

KATHMANDU, Sept 29 (RSS) - The Defense Ministry has, in a press statement, today clarified that the Royal Nepal Army is an inseparable part of His Majesty's Government and it has always been dutifully carrying out the directives of the government and responsibilities bestowed upon it as per the constitution of the kingdom and relevant rules and regulations.

As the army is a main security organ of His Majesty's Government it is  the duty of the army to follow orders and directives received according to the law, the statement says adding that while staying within this parameter the Royal Nepal Army has been playing an active role, all the while remaining aware and alert towards the interests of the country and people.

The question does not arise of the Royal Nepal Army disobeying the orders of His Majesty's Government and the Defense Ministry has no record of any such example in the history of the Royal Nepal Army, the statement adds. The Royal Nepal Army is usually brought into the discussions whenever any incident takes place following increase in violence due to Maoist activity and comments are also made over lack of cooperation from the Royal Nepal Army, the statement says adding that serious debate alleging guilt on the part of the Royal Nepal Army following the attack by Maoists at the headquarters of Dolpa on September 25 has drawn the attention of the Defense Ministry.

Stating that the Defense Ministry in its capacity as the chief security organisation of the country is sensitive over the Maoist problem and the resulting violent activity, the statement also says the stance of His Majesty's Government is that resolution of the Maoist problem without mobilising the military and through other appropriate alternatives would be in the overall interest of the nation.

Bhattarai demands PM's resignation

By Madhavi Bhatta

KATHMANDU, Sept 29 - Following the killing of 22 policemen in a span of three days by Maoist insurgents, former Prime Minister Krishna Prasad Bhattarai today demanded the resignation from Prime Minister Girija Prasad Koirala.

PM Koirala had come to the power by ousting the then prime minister Bhattarai in the last week of March on the grounds of failing to maintain law and order in the country.

While assuming power, Koirala had promised to maintain law and order and promised to send back all the Maoist victims to their villages by Dashain.

Bhattarai today demanded Koirala's resignation after visiting injured policemen at Birendra Police Hospital. The policemen were hurt by armed insurgents in Dunai of Dolpa district where 14 cops succumbed to insurgents' attack last Sunday night. Bhattarai said that there was need of alternative government from within Nepali Congress party accusing the Koirala-led government of failing to maintain peace and order.

"The situation of the country has deteriorated ten times more than that during my tenure," Bhattarai said, "The party should find resolution from within the party itself to improve the situation of the country."

"Though the present government has failed in its way, the second generation leaders (of the party) are competent to lead the country," he said, adding "we need to go for the alternative immediately."

Commenting on the Home Minister's interview to BBC on Wednesday night about the Dolpa killing, Bhattarai said, "It is an evidence of foolishness." Home Minister had said in the interview that it was a "minor incident".

Responding to journalists' query about the possibility of talk with Maoists, Bhattarai said, "Until the present government remains in power, Maoists will never come for table-talks."

Former PM Bhattarai said that it was time to mobilise the army to combat the four year long insurgency. "It is the right time to mobilise the army," he said.

Out of 37 policemen injured in Dolpa episode, there are 17 policemen undergoing treatment in Birendra Police Hospital.

Army should be under Govt control, says UML leader

Post Report

KATHMANDU, Sept 29 - Leader of the opposition in parliament Madhav Kumar Nepal today strongly stood behind the beleaguered government in the behind-the-scenes tussle over the role of Royal Nepal Army. 

Talking to The Kathmandu Post after outside the Prime Minister's Office at Singha Durbar Friday, Nepal, who is also the general secretary of the CPN said the army has to be under the control of the elected government.

"Naturally, the army should be under the control of the government. Maybe there is a different procedure for the mobilization of the army, but it should always be under control of the government."

Opposition leader Nepal however said the army should not be dragged into a controversy, as has been the case recently after the incident in Dunai, Dolpa district.

Asked if his party would support the mobilization of the army against the Maoist rebels, Nepal said, "first of all, the government should come out with a clear cut opinion and then only we can state our position."

"If the army is not under the government's control, or if the soldiers ignored the orders of the Defense Minister (in the Dunai incident), then the government should say so clearly. It should bring the issue in Parliament for discussion," Nepal added.

But in site of the question lingering over the army, opposition leader Nepal also indicated that the Maoist rebellion could not be solved by a military solution alone. "The Maoist rebellion is a political problem," he said flatly, indicating that a political solution should also be sought.

RA Boeing 757 damaged in bird-hit

By Damakant Jayshi

KATHMANDU, Sept 29 - A large bird was sucked into an engine of one of RNAC's Boeing 757 jet bound for London with 179 passengers on board today, airline officials said.

None of the passengers were injured in the incident as the jet was in the initial stages of its take-off run. The Rolls Royce engine was badly damaged and the aircraft could remain grounded for days. The damage alone costs over a million US dollars.

"Major mishap was averted because the aircraft was only in its initial speed," said Capt. D K Buddhist who was at the controls when the bird strike occurred. Capt. M T Lama, the co-pilot on the flight, said the bird was probably a vulture.

"We heard a noise from the right engine and took immediate action by stopping the plane," said Capt Lama, adding "it was not difficult as the speed was very low."

Lama added that the problem of bird hazards increased with the on-set of winter when the hibernating earthworms resurfaced for the warmth, attracting the birds in turn.

Capt Buddhist said it was up to the authorities to ensure that such hazards do not get repeated. "Nothing affecting the safety of the plane should be allowed in the take off and landing area," added Buddhist. He further said that not only birds, but also cats, dogs and even humans sometime pose risks to aircraft at TIA.

"We don't want to blame the authorities but some immediate safety standards are needed," Buddhist said.

According to Mohan Khanal, RNAC's director for External and Public Affairs, all the 179 passengers were later transferred to another RNAC B-757 jet. The rescheduled flight took-off for London via Dubai at 4 pm.

Speaking about the loss, Khanal said the engine has to be changed which is a big loss to the RNAC. "We are assessing other losses too," said Khanal.

Khanal pointed out that the hotel bills incurred on the London and Dubai bound passengers would be huge. "All the outstation passengers will have to be kept in a hotel at our cost," added Khanal.

Meanwhile, the arrival of a Thai Airways flight to Kathmandu was delayed by nearly an hour due to bird activity on the runway and a "missed approach". Two other flights - the Munich-bound Condor Airlines and the outgoing Singapore Airlines - too were delayed due to bird hazards at the TIA today.

ATR deal divides PAC

Post Report

KATHMANDU, Sept 29 - On the last day before recessing for the Dashain holidays, members of parliament's Public Accounts Committee (PAC) today debated on the case involving the national carrier RNAC's bid to purchase two French-built ATR aircrafts.

But as has been the case for the last several hearings, PAC could not reach a decision today, despite having set itself a deadline.  Instead, PAC members , who in the past have been unanimous, were seen divided in this case.

One of the member even accused of outside pressure and intervention in the billions of rupees deal case.

"This morning I got call from various places asking me to remain absent from today's meeting. Dirty methods are being used in this case," alleged Lilamani Pokhrel, an outspoken lawmaker from the United People's Front.

Trouble in the aircraft purchase case began after the PAC came at loggerhead with another parliamentary committee that took over the case even while it was being reviewed by the PAC. The PAC severely criticized the Finance Committee for interfering and taking a decision on the case being investigated by it.

The PAC had been investigating into the deal to purchase the two French-built ATR aircrafts and had ordered RNAC to present all the papers relating to the deal to the committee. PAC began the probe after critics said that the airline decided on the purchase without calling tenders.RNAC officials say that no such tenders is necessary to purchase aircraft for domestic operation, as in this case.

PAC had meanwhile ordered RNAC not to send the advance "lock up money" to the ATR company while it investigated the deal, prompting civil aviation authorities to accuse PAC of obstructing the workings of the airline. The debate continues, as is the PAC hearings.

Foreign companies eye insurance market

By Ameet Dhakal

KATHMANDU, Sept 29 - The sleepy Life Insurance sector in Nepal is likely to wake up to a full-fledged competition with at least four new companies, mostly in joint venture, trying to enter the largely untapped life insurance market.

Two companies - American Life Insurance Company (ALICO), an American multinational operating in over 70 countries and Nepal Life Insurance Company (NLIC), a cent-percent Nepali company promoted by NIC-Bank group have already obtained approval from the Ministry of Finance for operation.

The Ministry last week gave green signal to NLIC, making it the first domestic company to obtain such approval in the last twelve years. ALICO's entry was endorsed some months ago. Both the companies are, however, yet to receive operating license from  the Insurance Board, an independent body which looks after insurance related matters.

Other companies in tow  are Laxmi Life Insurance Company promoted by Khetan Group and Kantipur Life Insurance Company, promoted jointly by Tibrewal Group and a group of university professors which are awaiting recommendation from Insurance Board (IB). Under the Provision of Insurance Act 1993, Ministry of Finance can only accept or reject the recommendations of Insurance Board but cannot award operating licenses.

Lava Prasad Sharma, Chairman of the IB informed The Kathmandu Post that IB's board meeting has already decided to award license to at least four companies. He also informed that IB is likely to forward recommendations of Laxmi and Kantipur Life Insurance Companies next month.          

With this development, that the so far dull and unattractive insurance market is likely to receive a fresh shot in the arm with the entry of these companies in the insurance market. Majority of the new entrants are to operate in partnership with the world class life insurers. The local aspirants are known to have approached Allianz Insurance, a German multinational; Jurich Insurance, a Swiss multinational and Life Insurance Company of India for their equity participation. Majority of them claim to have reached the final stage of negotiation with their likely partners.

Nepal's Life Insurance market remained virtually stagnant for the last twelve years following government's unofficial moratorium on new entrants. Though, the other key service sectors including banking were opened for joint venture investment since the mid eighties and further accelerated under the liberal economic dispensation of post-1990s, successive governments chose to keep the life insurance sector away from new investments.

The government was forced to rethink over its policy about one and half year ago when ALICO formally applied for permission to operate under the provision of Insurance Act 1993. The Act permits entry of foreign companies in life insurance sector.

The ALICO however, had to wait for more than a year before  Finance Minister Mahesh Acharya finally approved its entry quashing a long-standing controversy surrounding it. The main opposition party CPN-UML had opposed the entry of any foreign company before the local aspirants were entertained. Even Nepal Rastra Bank, the government's principal advisor on economic issues, had expressed similar views.

IB's recent study shows a tremendous market potential in life insurance sector in Nepal. According to the study, 1.6 percent of eligible Nepalese population have opted for life insurance till 1999/2000. By the end of 2005, the number of clients seeking life insurance service are expected to cross  half a million individuals.

Likewise, potential life insurance premium is also billed to increase to  Rs. 1.19 billion by the end of 2005. The estimated premium will be able to support at least five more life insurance companies, says the study.  "Based on this study, we revised our earlier stance and decided to offer operating license to four new companies," says Sharma.

IB had earlier argued that Nepalese insurance market was not mature and large enough to be further opened up. Currently there are only two life insurance companies, one each in public and private sector, operating in Nepal.

Peace Corps reunite in the land of love and sometimes peace

By Pradeep Silwal

KATHMANDU, Sept 29 - When they came to Nepal 38 years ago as first batch of Peace Corps volunteers many had no idea they would fall in love with this country of majestic Himalayas and ancient culture.

Now, mellowed with age and rich in experience, 22 of them, some along with their spouse and children have revisited this country with the "open museum with living culture" where they had fallen in love at the first sight. A couple even remarried recently making this reunion trip to Nepal as memorable as their honeymoon.  

The reunion made the volunteers nostalgic. Back in 1962, Kathmandu Valley was in its pristine glory, with clean air, open spaces and uncrowded roads. Electricity and tap water were a luxury and metalled roads stretched only a few kilometres. With much less traffic than today, they used to bicycle to Bhaktapur or Patan where some of them taught at schools or colleges.

Peace Corps volunteers used to draw curious gazes from the local people who probably hadn't had any opportunity to come closer with the "white people" before.  Hippies hadn't discovered Shangri-la thus the volunteers were among the first few people to popularize Nepal to the outside world.

Apart from making Nepal known to the other side of the globe, they helped Nepal in its initial steps of development efforts as teachers, architectures, health workers, foresters. In these 38 years some 4000 volunteers have shared their expertise and collected invaluable experience in Nepal after President John F Kennedy declared a policy of sending US Peace Corps volunteers to different parts of the world in 1960.  

Robert Bates, 89, visited Nepal in 1954 during his vacation and later came as the head of the first batch of US Peace Corps. "I had come to Bombay to take part in inauguration ceremony of an oil mine. They offered us to show places in India but I chose Nepal and came here. I fell in love with this place and later returned as the director of peace Corps," he said.

Nepal provides fresh attractions to Peter G. Grote, 62, specializing in Mountain Architecture Photography. He wants to persuade his 21 year-old-daughter to tread on his footsteps and come to Nepal as a peace corps volunteer.

"In my case, it was love at first sight with this country," he says. He likes Khumbu, Rolwaling, Langtang, Thasi Lakpa and has  captured them in his camera and posted on his website.       

Every volunteer has sweet memories to share and stories to tell. Julie and Rolf Goetze, wife and husband had a hearty laugh when they overheard locals wondering loudly on their way to Thorang la pass who was man and who was wife. They might be the first tourists to have crossed that pass now very popular among the trekkers.