MonitorsPublished on May 25, 2012
With all political options shrinking before the nation's leaders, Nepal has landed in a political mess like never before in its recent history.
Nepal: Back to turmoil
< class="heading1">Analysis

With all political options shrinking before the nation’s leaders, Nepal has landed in a political mess like never before in its recent history. How the nation comes out of the mess of its own creation, and ironically over issues of State-restructuring and nation-building would be keenly watched just as the transformation from monarchy to Republic, and the inclusive processes of mainstreaming the Leftist Maoist militant-insurgents, was in more recent years. In turn, they constituted the first stage of efforts at national reconciliation, but the job remains to be taken to its logical conclusion as much in content as in form.

On May 24, 2012 the Supreme Court passed a stay order on the Government’s plan to seek another three months extension for the Constituent Assembly (CA). The apex court said that the plea is against its November 25, 2011 verdict which clearly stated that there cannot be any more extension. The court had ruled that after May 27, 2012, the political leadership has to conduct another CA polls, go for referendum or seek other suitable alternatives.

This has left the major political parties with no option but to come up with a draft Constitution within 72 hours, earlier this month . At the time of filing this story, the political parties had reached no consensus on the main contentious issue of State-restructuring. Whereas the Maoist leaders have come under immense pressure from the ethnic groups to opt for ethnic federalism, other major parties like the Nepali Congress and the UML are insisting that the Government stick to the 11-province model as agreed by all parties on May 4.

In a clear show of judicial activism, the single-judge Bench of Chief Justice Khila Raj Regmi even issued a notice for Prime Minister Bhaburam Bhattarai and the Law Minister to appear before the court on grounds of contempt for having initiated the process for getting the term of the Constituent Assembly extended.

Bhattarai has thus landed in a very difficult position. The Nepali Congress, which joined the consensus Government just 17 days ago, was already out of the Government and the Madhesi Front was agitating for more autonomy for Madhesh. The Upendra Yadav faction within the Madhesi Front wanted ethnic federalism as the basis for State-restructuring. This left the Government with limited choice. It had two days in hand to garner support from all parties to agree on a re-negotiated federal model. The Maoists were insisting that there should be either 10 or 14 Provinces in the new State of Nepal.

The political crisis deepened after the Nepalese Federation of Indigenous Nationalities (NEFIN) organised a three-day nation-wide bandh from May 20-22 demanding separate states for some ethnic groups like Limbuwan and Khumbuwan. The country was already hard hit by other strikes called in different regions by various groups for and against federalism. The Kathmandu Valley itself came to a grinding halt after the demonstrators obstructed traffic. Even media vehicles and ambulances were not allowed to ply on the roads of the capital. In a serious turn of events during the week, NEFIN members attacked media persons vandalising media vans and thrashing some journalists. They blamed the media for "inadequate coverage of their demands" and other activities of NEFIN.

On May 22, the Government signed a nine-point agreement with NEFIN committing itself to address the demands of the ethnic groups. Immediately thereafter, Maoist Chairman Prachanda had to call for a re-negotiation of the 11-province agreement with other major parties and Prime Minister Bhattarai floated the idea of another extension for the CA.

There is again a complete breakdown of the political consensus in the country. While the Nepali Congress is now out of the Government, the United CPN (Maoist) has few political options at hand. Chairman Prachanda has entered a dangerous course by entering into a new deal with ethnic groups. Prachanda had earlier adopted the line of State reconstruction on the basis of identity and capability. It was clear that he could not garner support for framing a new model for federalism in just two days, before the May 27 deadline ran out. The other option was to draft a Constitution by postponing the entire issue because it was not only determining the number of provinces that remained contentious, the CA also had to settle their demarcation and names. No consensus in sight at the moment.

The public opinion stays divided over the issue of State-restructuring. While the Nepali Congress and the UML and the upper middle class in urban centres are not in favour of an ethnic division of the State, some prominent columnists and civil society members are pressing the need to address the concerns of the indigenous groups, Dalits and other minorities.

Since the CA’s term could no longer be extended, the political exercise was concentrated on saving the legislature/ Parliament. At one stage, there was a high possibility that the CA might endorse a draft of the Constitution which would include the number of provinces, leaving other issues of State-restructuring for Parliament to finalise on a later day. In either case, the CA would not have been able to draft a Constitution that incorporated the popular aspirations of the ethnic groups. This would have only lead to more serious problems in the days ahead.

(The writer is an Associate Fellow at Observer Research Foundation)

< class="heading1">Analysis

Myanmar: What after the Indian Prime Minister’s visit?

Sripathi Narayanan

Indian Prime Minister Manmohan Singh’s visit to Myanmar from May 27-29 could not have come at a more opportune time for further improvement in the bilateral relations. It was the first prime ministerial visit from India in 25 years, after the late Rajiv Gandhi did so in 1987. That was before human rights had become an international issue for Myanmar.

Singh’s visit came in the backdrop of the ongoing democratic reforms in country, where the ’junta’ of yester year has since been projected as the leading light of political and economic change. Incidentally, in the past six months or so, Naypyidaw has played host to a number of foreign dignitaries, including one-time critics from the Wes. In this background, the Indian Prime Minister’s visit was being criticised as being "too little, too late". India, being one of the few important neighbours of Myanmar should have been pro-active from the word, ’Go’, and should have taken the initiative to welcome the democratisation of the nation ? or, so goes the criticism still.

What is little acknowledged is the sensitivities involed in the trilateral India-Myanmar-China relations on the one hand, and the low-profile Indian engagement with the junta on the democratisation front. Given the realities of geo-politics and the practicalities in the ground situation, New Delhi might not have shouted at Myanmar from roof-tops, but it did hold the Myanmarese hand through the processes that led to democratisation without the rest of the world having to know, or acknowledge, either.

The critics also said that New Delhi’s perceived engagement with Myanmar was restricted to a few aspects. The rhetoric about Myanmar is that it is the gateway to South-East Asia and a key element in India’s ’Look East’ policy. Mundane arguments included Myanmar’s natural resources, security concerns (drugs, insurgency in India’s North-East) and thel geo-strategic game of shadow-boxing with China.

Unfortunately, on all these counts, the critics did not fare well, instead restricted their assessment to a few areas and fail to realise the larger picture. For a start, India has shared a healthy relationship with Myanmar, all along. The bilateral trade between the two countries doubled between 2005 and 2010, and now stood at $1.2 billion. At the same time, India was also the largest market for Myanmar’s exports, the second largest export market after Thailand and the fourth largest trading partner after Thailand, China and Singapore.

On the ’Look East’ policy, India has been dealing with individual countries in a different manner as visible with a long list of trade and other agreements inked at the bilateral-level. At a different level, New Delhi has had arrangements with the ASEAN as a single group and the ASEAN Regional Forum, otherwise. These strides have been made by India despite the reservations of Nyapyidaw.

Under these circumstances, what could have Singh’s visit achieved. The Prime Minister was leading a contingent of diplomatic corps, security mandarins and a significant number of corporates leaders. This visit was thus seen as a continuation of Myanmarese President Thein Sein’s India visit, last October. Thus the Prime Minister’s visit from the start was expected to strengthen the multi-faceted relationship as well as welcome the nascent democracy into the international-fold. Singh’s meeting with Opposition NLD leader Aung San Suu Kyi would have been scheduled, and viewed, as well -- in the larger context of democratisation and not in terms of India’s support for individual groups or leaders.

Despite the need for entering into bilateral agreements at the commercial-level, it was seen to be prudent for India to wait and strike later, since the recent internal developments have shown a change in Naypyidaw’s attitude. Of late, the Myanmar Government has partially or completely reversed its decision when faced with popular opposition to its developmental activities initiated by foreign players. The case of Myitsone dam and Dawei Port are pointers to the same. Inida needed to be alive to the changing dynamcis of Myanmarese Government thinking in the post-democracisation era, and could not afford to commit the same, pre-conceived decision of the common Chinese neighbour ? which went awry.

Incidentally, the Thai Prime Minister Yingluck Shinawatra, in January, had mooted the idea of India utilising the facilities of the Dawei port as a highway for trade with South-East Asian nations. It would seem as if both Myanmar and her neighbours are engaging India in a manner that would reap long-term dividends for all stake-holders without being seen as being intrusive. Even if this is not the case, New Delhi should strive for such a course, since this would be in the best interests of India.

Given the changing political contours of Myanmar, that nation in the years to come will face difficulties in matters of economic progress through sustainable, inclusive development. India is becoming increasingly familiar with the emerging trends and would know how to handle such a situation even before it became one. Yet, India would have to be aware to the reality that not all nations dealing with Myanmar in a big way followed such norms.

However, the India on its part would have to engage with nations and neighbours like Myanmar, at the highest levels more frequently and regularly. It would also mean that the government must make good of its past commitments and bring into operation past initiatives. In this case the border trade efforts have reaped limited dividends on the ground despite best intentions. For nations like Myanmar, bilateral ties do not terminate with political and policy states but more on ground realities that are driven by economic factors and are governed by the cost and time issues.

Thus, Prime Minister Singh’s visit could not be limited to stating intentions and dolling out new assistance but to make good of them in a manner that’s visible and appreciated by the people of Myanmar. This gains importance since Myanmar will be engaging with a number of other nations, thereby increasing the level of competition for India. Under the circumstances, India would have to not only outbid others but also outdo others for it to stay relevant in the larger Myanmarese context, over the medium and long terms, too.

(The writer is a Research Assistant at Observer Research Foundation)

< class="heading1">Country Reports

< class="heading12boldGeorgia">Power-shortage sparks protests

A series of public protest has broken in the country owing to persistent power shortages that the nation is now facing. For the past three months the nation is facing sever power shortages. The protests have now become the largest public demonstration since the 2007 agitation that was crushed by the Government by force.

The current round of public demonstrations is taking place in a number of places in the country, including Yangon and Mandalay. Incidentally, the protest venue in Yangon is the Sule Pagoda, which was the focal-point of the protests in 1988 and 2007 .
< class="text11verdana">Source:, May 21& 24, 2012.

< class="heading12boldGeorgia">Peace talks with Shan State Army

Ethnic Shan rebels have agreed to take part in the second round of peace talks to end fighting with Government troops. Negotiator Aung Min, who is also the country’s Railway Minister, said he discussed enforcing a December cease-fire and eradicating drugs in eastern Myanmar in talks with Yawd Serk, leader of the Shan State Army (South).

The Minister told reporters that the talks in the Shan State capital, Kengtung, and those recent clashes were a result of misunderstanding over the firing of warning shots.
< class="text11verdana">Source:, May 20, 2012.

< class="heading12boldGeorgia">Norway’s minister to meet Karen leaders

Norway’s Deputy Minister of Foreign Affairs Torgeir Larsen is planning to meet with leaders of the Karen National Union (KNU) during his visit to Myanmar.

According to Naw Zipporah Sein, General Secretary of the KNU, Larsen planned to meet the Karen group during his trip, and may also visit its new liaison office in Kyaukgyi Township of Pegu Division. He is also planning to meet Myanmar opposition groups in Chiang Mai to discuss Norway’s future role.

It is believed that Larsen would like to observe first-hand the work around Kyaukgyi being conducted by the Norwegian Peace Support Initiative (NPSI) with the cooperation of the KNU and other relief groups on the ground.
< class="text11verdana">Source:, May 25, 2012.

< class="heading12boldGeorgia">Suu Kyi to attend World Economic Forum

In her first journey outside the country in over two decades Aung San Suu Kyi will travel to Bangkok to participate in the World Economic Forum (on East Asia) that is being hosted in the Thai capital. The World Economic Forum will be held from May 30 to June 1.

The nation’s President Thein Sein will also attend the event, according to a Government official who did not want to be named.
< class="text11verdana">Source:, May 24, 2012.

< class="heading12boldGeorgia">Strike in Chinese factory

Around 25 workers at a Chinese-owned steel factory in Rangoon Division are on a hunger strike following the company’s refusal to raise wages. The workers are among a group of 400 who have been on strike at the Yangon Crown Steel Factory in Hmawbi, Rangoon Division, since May 20, 2012.

According to the workers, no negotiations have been held with the company’s management since the walkout began nearly a week ago. The workers said that students and labor activists have been giving them food since the strike began.

The workers earn a basic wage of 160 kyat (less than US $0.20) a day. Monthly incomes, including overtime pay and various allowances, range from 4,500 to 10,000 kyat ($5.35 to $12), which the workers want increased to 40,000 kyat ($48) a month.
< class="text11verdana">Source:, May 25, 2012.

< class="heading12boldGeorgia">NC quits Govt

Expressing reservations over the Government’s plan to seek extension of the Constituent Assembly’s term, the Nepali Congress (NC) pulled out of the BaburamBhattarai government on May 24, three days before the expiry of the deadline to write the new constitution.

A Central Working Committee meeting of he NC took a decision to this effect just 18 days after it joined the government following a five-point deal reached among three major parties and the United Democratic Madhesi Front (UDMF) on May 4.

Following this, Deputy Prime Minister Krishna Prasad Sitaula and Minister Surya Man Gurung submitted their resignation to the PM.

The NC has stood firm against extending the CA’s term. It has alleged that the prime minister through cabinet decision had committed a ’constitutional blunder’ by seeking CA’s term extension.
< class="text11verdana">Source:,, May 24, 2012.

< class="heading12boldGeorgia">SC strikes down extension bill

The Supreme Court (SC) on May 24 annulled the bill for extending the term of the Constituent Assembly (CA) by yet another three months. The decision has put pressure on the political parties to promulgate the new constitution within 72 hours.

The single bench of Chief Justice Khil Raj Regmi ruled that the bill registered on May 22 in parliament to extend the CA term was in violation of the SC verdict of November 25, 2011 and contradicts Articles 64 and 116 of the Interim Constitution.

The SC said that the CA should complete drafting the new constitution within May 27 and in case it fails to meet the deadline, it can exercise one of the three options the SC suggested in November last year ? go for another CA election, a referendum, or some other suitable way out.

In addition, the SC on May 24 asked PM Bhattarai and the law minister to present themselves at the Court with written explanations within a week in a separate petition concerning contempt of court.
< class="text11verdana">Source: Republica, Kantipur, May 24-25, 2012.

< class="heading12boldGeorgia">Strike called off after nine-point deal

The Nepal Federation of Indigenous Nationalities (NEFIN) called off its general strike after signing a nine-point agreement with the government on May 22.

The Government has agreed to consider the issues raised by NEFIN in the CA. NEFIN has demanded ethnicity-based federalism, rights to self-determination, self-autonomous provinces and preferential rights.

The Government has also assured NEFIN that the country will adopt a mixed electoral system with 60 per cent proportional representation. It has also agreed to take initiatives to guarantee proportional representation of marginalised communities in state mechanisms. All NEFIN cadres arrested during the strike days have been released and those injured have received free medical treatment as well.

The three-day bandh by the NEFIN has been condemned by all quarters for attacking the press and vandalising vehicles and shops across the country. Many local residents in the valley were also injured when they clashed with banda enforcers. The media have accused the police and the Home Ministry for not doing enough to prevent the demonstrators from attacking media persons.
< class="text11verdana">Source:, May 23, 2012.

< class="heading12boldGeorgia">Call for the mining gas

Maqsood Gujjar, a lawyer, has moved a petition to the Lahore High Court in order to prompt the Government to reserve funds in the forthcoming budget for the Thar Coal gasification project. The petitioner asserts that the absence of funds will put an end to this project which is a viable solution to the ongoing energy crisis.

Gujjar has argued that the Thar coal is the largest energy resource discovered in the country and can be used in a greater proportion to generate electricity. Currently, 40 per cent of the electricity is generated from oil, which has to be imported and thus is becoming hardly affordable for the State. The use of coal would thus allow huge savings and enable a stable electricity supplying.
< class="text11verdana">Source: Daily Times, May 22, 2012.

< class="heading12boldGeorgia">Doctor convicted for Osama killing

The US has condemned the 33-year prison-term for Dr Shakeel Afridi, who helped the CIA to find Osama bin-Laden last year by organising a fake vaccination programme to collect DNA samples. The doctor was charged with treason. US law-makers have since decided to amend the foreign aid budget in order to cut $1 million to the aid for Pakistan for each year of jail undergone by Dr Afridi.

This new thorn in the US-Pakistan relations worsens the current lack of trust and deepens the tangle of issues opposing the two allies. Indeed, the question of the drone attacks, the reopening of the NATO supply-routes and the accusations of feigning the struggle against terrorists are bringing the situation to a standstill.

On the Pakistani side, leaving ground to the US pressures by an inch would bring the Government to a critical point as it is already unpopular in consequence of the widespread power-cuts, the running inflation and poverty. In the same way, the forthcoming US presidential elections are inciting the Obama government to stand its ground.
< class="text11verdana">Source: Dawn, The Express Tribune, May 25, 2012.

< class="heading12boldGeorgia">Speaker not to disqualify PM

Two days after the 30-day deadline for the decision on the future of Prime Minister Yusuf Raza Gilani, Dr Fehmida Mirza, the National Assembly Speaker, decided not to follow up the disqualifying claims against him. She justified her statement by specifying that the Constitution does not raise the question of the disqualification of an elected member.

To dismiss the allegations of the constitutional experts claiming that she should have referred the case to the ECP (Election Commission of Pakistan), the National Assembly Speaker leaned on previous cases to justify that she was empowered to take the decision.
< class="text11verdana">Source: The Express Tribune, May 25, 2012.

< class="heading12boldGeorgia">Twitter banned

The Government blocked Twitter during a few hours, the website refusing to remove a material promoting a competition of images of the Prophet Mohammed, considered blasphemous and offensive to Islam.

The number of users of Twitter in Pakistan is estimated at six millions. The thriving role of social networks as means of communication complicates any thorough examination of the content of the daily volume of information. Thus, it appears that any will to control the opinions expressed on websites cannot accept half-measures.
< class="text11verdana">Source: Dawn, The News international, May 21, 2012.

Sri Lanka
< class="heading12boldGeorgia">Lankans ready to move forward : MR

"The people of Sri Lanka are ready to move forward and sustain peace and achieve economic prosperity, which will be possible, only if we stand together as one country," President Mahinda Rajapaksa has said.

Addressing the 12th Doha Forum and Enriching the Middle East’s Economic Future Conference at Doha as an international Guest of Honour, the President said the Government was committed to walk that extra mile to achieve permanent peace through reconciliation and economic empowerment of the people, and I am glad to say that we have already embarked on that national endeavour.

President Rajapaksa said the Government was also committed to empower the rural economy and agriculture in the island as well as the IT sector.

Following his address, the President paid a courtesy call on the Emir, who visited Sri Lanka with a business delegation in January this year, and discussed bilateral relations between Sri Lanka and Qatar.

External Affairs Minister Prof. G.L. Peiris and Secretary to the President Lalith Weeratunga were also present at the discussion.
< class="text11verdana">Source: The Island, Colombo, May 21, 2012.

< class="heading12boldGeorgia">Sri Lanka to benefit from RBI’s $2-bn swap arrangement

Sri Lanka is among the member nations of SAARC who will benefit from the RBI’s $ 2 billion swap arrangement aimed at strengthening regional financial and economic cooperation, the Indian High Commission has said.

Governor of Reserve Bank of India (RBI) D Subbarao on May 16 had announced that the RBI will offer swap arrangement of $ 2 billion both in foreign currency and Indian rupee. The facility will be available to all South Asian Association for Regional Cooperation (SAARC) member countries, viz, Afghanistan, Bangladesh, Bhutan, Maldives, Nepal, Pakistan and Sri Lanka.

With launching of this facility, member-countries can now approach Reserve Bank of India for availing of the facility. The central bank of Sri Lanka will need to enter bilateral swap agreements, which need final approval from the Government of India, the Indian High Commission said in a statement.

The swap will be offered in US dollar, Euro or Indian Rupee against the domestic currency or domestic currency denominated Government securities of the requesting country. India will contribute the entire fund. The swap amount available to various member central banks has been arrived at broadly based on two months import cover subject to a floor of $ 100 million and a maximum of $ 400 million per country.

The first rollover will be at the normal rate of interest, while the second one attracts 50 basis points interest more than the normal interest rate.

For this purpose, the normal interest rate agreed upon is the London Interbank Offered Rate (LIBOR) for three months plus 200 basis points. The normal interest rate for Indian rupee swap is RBI Repo Rate minus 200 basis points.

The SAARC swap facility is being offered by the Reserve Bank of India in light of the decision of SAARC Finance Ministers at the SAARC Ministerial Meeting on Global Financial Crisis, held on February 28, 2009, which noted that "A major cause of current concern in the region is the drying up of credit and the contraction of financial markets."

"Mechanisms must, therefore, be developed aimed at creating bilateral arrangements in the region to address short-term liquidity difficulties and to supplement international financing arrangements," it had noted.
< class="text11verdana">Source: Daily Mirror, Colombo, May 21, 2012.

< class="heading12boldGeorgia">NATO withdrawal confirmed

The NATO summit that recently concluded in Chicago has led to the consensus among NATO leaders that almost all foreign combatants will be withdrawn by 2015. US President Barack Obama, on the one hand, assured his countrymen that the war was over, and on the other, pressed upon NATO members to continue their war efforts until 2014 and funding till 2024 by arguing that the region remains fragile and continues to threaten international security.

The world’s faith in the fight against terrorism stands battered as more than a decade into the conflict in Afghanistan, terrorism still remains a potent threat not only in the region, but to the world. The inefficiency of contemporary counter-terrorism strategy becomes even more glaring when its economic cost is considered. Around $4.1 billion is spent on maintaining troops in conflict areas, which in times of economic crisis, has further led to the war’s unpopularity in western countries.

Recently-elected French President Francoise Hollande’s electoral resolve to withdraw 3,400 French troops by the end of this year further compounds the problem. The Chicago summit concluded by confirming the withdrawal of almost all of the 13,000 troops serving in Afghanistan along with the packing up of all combat missions by 2013.

This move will lead to an ’irreversible’ transition of the security responsibility to the Afghan troops by the end of 2014 and NATO will be pushed to the fringes by confining its role to training and mentoring.
< class="text11verdana">Source: Khaama Press, May 25, 2012.

< class="heading12boldGeorgia">Hollande’s surprise visit

French President Francoise Hollande paid an unannounced visit to Afghanistan. The purpose of this visit was to meet Afghan President, Hamid Karzai and discuss withdrawal of French troops by the end of 2012, two years before the scheduled pullout of the remaining NATO troops.

The decision to pull out of Afghanistan has been a source of tension among the NATO allies, who fear that the withdrawal will set a precedent for other NATO member countries. Accompanied by Foreign Minister Laurent Fabius and Defence Minister Jean-Yves Le Drian, Hollande conveyed to President Obama that he will not backtrack on his electoral promise.
< class="text11verdana">Source: Outlook Afghanistan, May 25, 2012.

< class="heading12boldGeorgia">Oil reserves discovered

Reserves of oil has been discovered in two old gas fields in the country’s north-eastern region with an extractable reserve worth $5.5 billion, informed chairman of state-owned Petrobangla. The two finds at Kailashtila and Sylhet contain proven reserves of 137 million barrels of low sulfur crude oil, of which 55 million barrels can be lifted commercially.

Low sulphur, or "sweet", crude oil is highly sought after and is more easily processed into gasoline than high sulfur crude. Bangladesh spent about $5 billion to import crude and refined oil in 2011 -- from about $4 billion in 2010 -- a large part of which was subsidised by the Government.

Bangladesh Petroleum (Bapex), a subsidiary of Petrobangla made the accidental finding last week while analyzing 3D seismic surveys conducted last year in an effort to determine the size of remaining gas reserves in the two fields, which were discovered in 1962 and 1955.

This is the first time that economically viable oil reserves have been found in Bangladesh. The country found a small oil reserve in the northeast in 1986, but could lift fewer than one million barrels of oil. Drilling will begun in the next 18 months.
< class="text11verdana">Source: Bhorer Kagoj, May 22, 2012, May 21, 2012.

< class="heading12boldGeorgia">Bangladesh Delta Plan 2100

The government has embarked on preparing 50-100 years’ long "Bangladesh Delta Plan 2100" to deal with issues like climate change, water resources management, river dredging and construction of embankment in a coordinated manner. Planning Minister A K Khandker said that the mega plan will be like the one of the Netherlands’ Delta Plan as characteristics of both the countries resemble.

A Delta Commission will be formed to implement the mega plan with assistance from Dutch Government. The two countries signed a memorandum of understanding (MoU) to this end this week, which would focus on strategic partnership in the fields of sustainable delta management, integrated water resources management, disaster management, and adaptation to climate change. The planning minister and visiting Dutch Minister for Development Dr Ben Knapen signed the MoU on behalf of their respective sides.
< class="text11verdana">Source: The Daily Star, May 23, 2012.

< class="heading12boldGeorgia">’Sahara deal’ criticised

Urban experts, green activists, economists and realtors criticised the Government’s decision to allow India’s Sahara Group to begin housing projects in Dhaka’s suburbs, saying it would ’harm’ Bangladesh’s economy and environment.

Indian infrastructure development company, Sahara India Pariwar this week signed a Memorandum of Understanding with the Bangladeshi Government to develop a new city near Dhaka with apparently ’affordable housing for low income group people’.

Sahara India is going to invest 800 billion rupees in Bangladesh and that the group has already selected 40 sqkm of land about 50 kilometres outside of Dhaka city, to begin the housing projects.

Economist Anu Muhammad, a faculty member of Jahangirnagar University said Sahara’s venture would bring about a ’great disaster’ for Bangladesh. He alleged that a strong coterie was working behind the scene to ’handover Bangladesh’s land to India. He further observed that the government instead of protecting lands and environment by reining in the ’aggressive realtors,’ are allowing a big Indian company to get into the sector which will be a great threat to our environment, ecology as well as to the economy.

Real Estate and Housing Association of Bangladesh (REHAB), Bangladeshi real estate companies’ organisation, slammed the Government’s decision, saying it would come as a huge blow to the local real estate industry.

However, president of the Institute of Architects, Bangladesh, Mubasshar Hussain observed Bangladeshi people can benefit from the venture only if Sahara takes the housing complex project with the aim to accommodate low income group people.
< class="text11verdana">Source: New Age, May 25, 2012.

< class="heading12boldGeorgia">GDP growth falls

GDP growth fell by 0.39 percentage point to 6.32 per cent in the current fiscal year, compared with the figures for last fiscal year. This fall is due to sluggish growth in the agriculture sector, according to the provisional data of Bangladesh Bureau of Statistics. In the current fiscal year, the agriculture sector grew by 2.53 per cent, which was 5.13 per cent in the last fiscal year.

The government had projected a seven percent GDP growth for this fiscal year against last year’s 6.71. However, donor agencies, including the IMF, projected the growth at between 5.5 per cent and six per cent. Fiscal year in Bangladesh is from July 1 to June 30.
< class="text11verdana">Source: The Daily Star, May 23, 2012.

< class="heading12boldGeorgia">Hunger strike by Opposition

Opposition Bangladesh National Party led 18-party alliance staged a seven-hour mass hunger strike this week to protest against what they called Government’s ’oppressive policies’. Thousands of activists of BNP participated in the day long protest. BNP chairperson also took part in the strike.

The Opposition alliance is staging the strike to press home its demand for tracing disappeared BNP leader Elias Ali, release of recently detained 33 top opposition leaders and reinstatement of the caretaker Government system. As many as 33 senior leaders BNP-led opposition alliance including acting BNP secretary general Mirza Fakhrul Islam Alamgir have been arrested on charges of arson during the general strike on April 29.

During the hunger strike, Khaleda Zia said that her party would sit for a dialogue with the government if it got an assurance in writing that the formation of a caretaker government would be discussed. She reiterated that the BNP would not accept any election under the present government or the incumbent president. Khaleda Zia also alleged that the Prime Minister Sheikh Hasina, her family and relatives had indulged in corruption, and claimed that the opposition had proof of it.

Parliament had abolished the non-party caretaker government system in June last year, which means the Awami league-led government of Prime Minister Sheikh Hasina will remain in power during the next elections scheduled for early 2014.
< class="text11verdana">Source: The Daily Star, May 20, 2012.

< class="heading12boldGeorgia">Air Force to buy 4 US aircraft

In a bid to modernise the tactical transport fleet of the Air Force, Bangladesh will purchase four Lockheed MC-130Es from the United States at an estimated cost of $180 million.

The proposed sale would cover the "regeneration, overhaul, modification and logistics support" of the second-hand Hercules. The package would also include 20 Rolls-Royce T56 engines to be provided as excess defence articles, plus training and other equipment and services associated with the upgrade.
< class="text11verdana">Source: The Daily Star, May 24, 2012.

< class="heading12boldGeorgia">Three Ministers top in Irregularities

The annual audit by the Royal Audit Authority has spotted finical irregularities to the tune of Nu 770.1 million in all ministries, 14 dzongkhags, 21 gewogs of 11 dzongkhags, eight autonomous bodies, seven corporations, two financial institutions and a nongovernmental organisation as well as a political party.

According to the report, the highest amount of irregularities was reported under the Information and Communications Ministry with Nu 234.6 m. This is followed by the Foreign Affairs Ministry with Nu 202.7M and Works and Human Settlement Ministry with an irregularity of Nu 72.5 m.

In the nongovernmental sphere the highest amount of irregularities was reported in Penden Cement Authority Limited with Nu 57.4M and Bhutan National Bank with Nu 46.5M. "The increase in the amount of total irregularities can be contributed to the increased number of audits conducted and reports issued in comparison to previous years,"

The observations in annual audit report have been grouped into four categories. The highest amount of irregularities of Nu 358.2 m is re-ported under shortfalls, lapses and deficiencies category, followed by Nu 285.113 m in mismanagement category. Nu 113.4 m is categorised under violation of laws and rules and Nu 13.3 m in fraud, corruption and embezzlement.

The Royal Audit Authority also noted that the Bhutan permanent mission to the UN in New York made irregular payments of $ 11,477 on account of allowance for Home Leave Travel Passage without supporting documents and another $ 46,160 as representational grant (RG) to various officials.

The Bhutan Embassy in Brussels had also made irregular payment of representational grants amounting to Euro 17,607 while the Embassy in Bangkok had made irregular payment of children education allowance of about $ 33,840 without producing necessary documents and another $ 14,880 as representational grant. It was noted that the RG claims were not supported by the bills in contravention to the Foreign Service entitlement rules and regulations. National Commission for Women and children had irregularities of Nu 19.9 m and the Tourism Council of Bhutan, Nu 2.2 m.
< class="text11verdana">Source:, May 24, 2012.

< class="heading12boldGeorgia">Four Bills for Parliament session

The ninth session of the Parliament is set to commence on June 8, where at least four new Bills are going to be deliberated upon. This session is expected to conclude on July 11. A tentative agenda for the session shows that the domestic violence bill and road bill will be introduced in the National Assembly while the National Council will take up the contract bill and alternative dispute resolution bill. The land amendment bill will also be introduced in the assembly, but might not be taken up for discussion, since there are still a few inspected have to be incorporated in the bill.

The Assembly will also deliberate on two conventions, Nagoya protocol on access to genetic resources, and the fair and equitable share of benefits, arising from their utilisation, to the convention of biological diversity, and the SAARC seed bank convention. While the Finance Minister is expected to present the annual budget and appropriation bill 2012-13.
< class="text11verdana">Source:, May 25, 2012.

< class="heading12boldGeorgia">Fuel prices up

Reflecting in the hike of petrol process in India by oil companies, Bhutan also witnessed a hike petrol prices to a tune of Nu y per litre. The hike comes at a time when the rupee has hit a record low at Rs 56 a dollar. Trade director general Sonam P Wangdi said the Indian government had requested oil companies in India not to increase petrol prices since November end last year. Petrol price was last revised in December 1. "Earlier, the re- vision was made almost on a monthly basis," he said.

Given the weak rupee against the US dollar, Indian oil companies have been losing out almost Rs 8 billion annually. India relies heavily on crude oil imports. Almost 70 percent to 80 percent of its crude oil is imported. When the dollar strengthens against the rupee, oil companies land up paying more to import crude oil, and run into losses when a rising US dollar is not supported by an increase in the price of petrol. Bhutan is entirely dependent on crude oil imports from India. Bhutan’s petrol import from India was worth Nu 694M in 2009, it increased to Nu 951M in 2010 and Nu 1.3B last year.

Prices for other fuels, such as diesel and cooking oil, have not changed. In Bhutan, revised petrol prices will differ from place to place, depend- ing on the transportation cost, with it being cheapest at the border towns, which are closer to the Indian refineries.
< class="text11verdana">Source:, May 24, 2012.

< class="heading12boldGeorgia">Power-links with SAARC nations

With an aim to ensure energy security in South Asia, SAARC members meet in Thimphu to discuss cross-border electricity inter-connection and to share experiences and technical capacities.

Incidentally, cross border electricity interconnection an element of SAARC Energy Ring and was mooted during the 12th SAARC summit. The Energy Ring is expected to benefit members like Bhutan and Nepal to supply electricity to fellow-member States who are their neighbours.
< class="text11verdana">Source:, May 23, 2012.

< class="heading12boldGeorgia">Level-playing field sought

The hydro-power sector with is more that four decades old, Bhutan has witnessed limited participate in the construction of the same by domestic players. A plea submitted by construction firms to the Government points out that the competitive bidding process for projects in this sector does not provide room for them to compete with their Indian counterparts.

The primary reason for this is not the lack of technical expertise but financial limitation that is required to undertake projects of such magnitude acts as a factor against domestic firms.

However the Energy Department Director -eneral Yeshi Wangdi said Bhutanese contractors had neither the expertise, nor the experience to take up hydro-power construction works on their own. He suggested the local contractors begin taking up sub-contract works to begin with.
< class="text11verdana">Source:, May 23, 2012.

< class="heading12boldGeorgia">No takers for national language

Dzongkha, the national language of Bhutan is struggling to make space of itself in the school curriculum. The nation does not have adequate number of teachers who are competent enough to teach subjects in that language. This is evident from the difficulties that were faced in teaching history in Dzongkha.

It is found that students have difficulties in reading and writing in the same language. However students from rural backgrounds seem to out shine their urban counterparts on the same scale.

The reasons for the lack of popularity of the national language is credited with limited job opportunities that the language provides as well as limited reading materials and general difficulty in learning the language.
< class="text11verdana">Source:, May 25, 2012.

< class="heading12boldGeorgia">Indian DGMO calls on the King

Lt-Gen Ashok Kumar Choudhary, Director General of Military Operations, Indian Army called upon the King Jigme Khesar Namgyel Wangchuck and Queen Jetsun Pema Wangchuck.
< class="text11verdana">Source:, May 22, 2012.

< class="heading12boldGeorgia">10 pc hike in petrol price

The UPA Government took a bold step on the first day (May 23, 2012) after its third anniversary by allowing state-run oil marketing companies to raise ex-refinery prices of petrol by a whopping Rs 6.28 per litre, the highest so far. With excise duty and state levies, this translates to Rs 7.5-Rs 8 (just over 10 per cent) hike per liter.

The opposition parties Thursday threatened countrywide protests against a steep hike in the price of gas while a key ally has demanded a reduction. India imports 70 per cent of its oil and retailers say they were forced to raise prices given the fall in the value of the rupee.

The currency has lost 13 per cent of its value since February and hit a new record low of 56.40 to the dollar in early trade Thursday.
< class="text11verdana">Source: The Indian Express, May 24, 2012,, May 24, 2012.

< class="heading12boldGeorgia">Gas deal with Turkmenistan

India and Pakistan Wednesday signed agreements with Turkmenistan for a project to pipe natural gas from the central Asian country through Afghanistan, marking a milestone in regional relations.

The signing of the gas sales and purchase agreements by state-run GAIL (India) Ltd. and Pakistan’s Inter State Gas System (Pvt) Ltd. in Turkmenistan comes after nearly two decades of negotiations and backing from the U.S. to build the pipeline, commonly referred to as the TAPI pipeline.
< class="text11verdana">Source:, May 23, 2012.

< class="heading12boldGeorgia">Gas demand to rise to 473 mcmd

India’s gas demand is estimated to rise to 473 million cubic metres a day (mcmd) in 2017 from 166.2 mcmd now, Oil Minister S. Jaipal Reddy said, as the energy-hungry nation is boosting use of cleaner fuel to power its economic expansion and cut subsidies.

Natural gas accounts for about 10 per cent of India’s energy market compared with the world average of 24 per cent, Reddy said at an event in Turkmenistan.
< class="text11verdana">Source:, May 23, 2012.

< class="heading12boldGeorgia">Wheat exports to Iran likely

India is considering wheat exports to Iran, a government source said, as New Delhi hopes to boost exports to Iran to help settle part of its oil imports bill through a bilateral mechanism.

An Iranian trade delegation will come to India next week to discuss wheat exports, the source added, without elaborating on the likely payment mechanism for sales to Iran.

Asked whether the government would export wheat to Iran, the government source told reporters: "That is under consideration."

India, one of Iran’s largest oil clients, aims to cut the trade imbalance which is currently tilted towards Tehran. Exports from the South Asian nation accounted for about $2.8 billion versus imports of about $11 billion in 2010/11, according to government data.
< class="text11verdana">Source:, May 20, 2012.

< class="heading12boldGeorgia">Rupee hits a new low

The Indian rupee sank to a record low for the fourth successive trading day on Monday, breaking the key level of 55 to the dollar amid global uncertainty.

The partially convertible Indian unit fell to a new low of 55.05 in late afternoon trade, below its previous low of 54.91 hit on Friday, as demand for the US currency grew. It later clawed back marginally to 54.97.

Local foreign exchange trade was steady on Monday morning after G8 leaders said they wanted Greece to remain in the Eurozone, but global concerns brought back jitters during the day.
< class="text11verdana">Source:, May 21, 2012.

< class="heading12boldGeorgia">NTPC plans $ 15-b coal import contract

NTPC Ltd. (NTPC), India’s biggest power producer, said it plans to spend as much as $15 billion over a decade to secure overseas coal supplies as prices of the fuel tumble to a 19-month-low.

The utility may sign five- or 10-year contracts for the first time to import as much as 150 million metric tons of coal, Chairman Arup Roy Choudhury said by telephone from New Delhi yesterday. The cost will be $15 billion, assuming a rate of $100 a ton, he said. Production constraints at state monopoly Coal India Ltd. are forcing the New Delhi-based generator to step up purchases abroad.

"With coal prices where they are, this could be a good time to lay our foundation for future imports," Choudhury said. "If we need more, we’ll buy it as we have in the past, 4 or 5 million tons at a time."
< class="text11verdana">Source:, May 23, 2012.

< class="heading12boldGeorgia">Economic growth to quicken

India’s economic growth is likely to rise to more than 7.5 percent in calendar year 2013 but continued government policy uncertainty could erode the country’s longer-term growth prospects, the OECD said on Tuesday.

A cyclical upturn in investment, stronger external demand and the effects of recent monetary easing will boost growth, the report said, although it warned that high inflation would dampen the investment climate.
< class="text11verdana">Source:, May 22, 2012.

< class="heading12boldGeorgia">New Delhi to go ahead with Iran meet

Undeterred by US Secretary of State Hillary Clinton’s counsel to pare down interaction with Iran, South Block is going ahead with a meeting next week in which Tehran will have a major role to play.

The three-day meeting on the North-South Corridor- which began as an Iran-India-Russia initiative but now has over 15 countries interested in the project-is aiming to be different from the usual conferences that dot the diplomatic calendar.
< class="text11verdana">Source: The Hindu, May 23, 2012.

< class="heading12boldGeorgia">J&K report wants all Central Acts reviewed

The Final report of the Central government appointed Group of Interlocutors for Jammu and Kashmir ruled out a return to pre-1953 position, and recommended the setting up of a Constitutional Committee (CC) to review all Central Acts and Articles of the Constitution of India, extended to the State after the signing of 1952 Agreement.
< class="text11verdana">Source: The Hindu, May 25, 2012.

< class="heading12boldGeorgia">Ex-Indian CJ advice for NCI

The Indian Express has said that name of an expert sent to advise the Commission of National Inquiry (CNI). India’s Ministry of External Affairs told the newspaper that former Punjab and Haryana High Court Chief Justice Mukul Mudgal had been sent to Maldives to assist with the commission’s conclusions.

The former Chief Justice, who returned to India last week, told the paper: "I have given my advice on the transfer of power? They wanted my help in how to go about holding a transparent inquiry into the entire affair, as well as meaning of certain legal terms."

Indian High Commissioner to the Maldives Dnyaneshwar Mulay told Minivan News that the Commission had made an official request for India’s assistance, adding that India would continue to be "happy to offer whatever little help we can."

The NCI is in the process of being reformed following pressure from the international community, from civil society, and from political opponents to enhance its credentials of independence and impartiality. After being reprimanded by the Commonwealth on these grounds, the government alleged that it had requested assistance with the CNI but had received no response. The Commonwealth responded by saying that it had received the request but felt the composition of the commission to be a more pressing issue.

Following meetings with the Commonwealth last week, the government agreed to add an international component, in the form of a Singaporean judge, as well as a nominee from former President Mohamed Nasheed. The appointment of the latter, however, is subject to certain criteria which have already seen a succession of nominees rejected by the Government.
< class="text11verdana">Source: Minivan News, May 22, 2012.

< class="heading12boldGeorgia">’Thasmeen did not ask for Govt guarantee’

The Opposition Dhivehi Rayyithunge Party (DRP) has denied the statement by Interim Vice President of Progressive Party of Maldives (PPM) Umar Naseer that DRP Leader Ahmed Thasmeen Ali had asked the government for a loan guarantee to repay his debts, and said that this is a complete lie.

Registrar of DRP and Deputy Minister for Home Affairs Mohamed Saleem (Hoarafushi Saleem) said at a press conference that Thasmeen had not asked the government for such a loan:

"Neither Thasmeen nor any member of his family have asked the current government for a loan or done anything illegal to obtain such a loan," Saleem said on behalf of Thasmeen.

He said that this statement by Umar Naseer is targeted at Thasmeen and the government; and called on the Government to clarify the issue to the Maldivian people.
< class="text11verdana">Source: SunOnline, May 22, 2012.

< class="brown12verdana">Contributors:

Afghanistan: Pankhuri Mehndiratta;
Bangladesh: JoyeetaBhattacharjee;
Bhutan and Myanmar: Sripathi Narayan;
India: Satish Misra;
Nepal: Akanshya Shah;
Pakistan: Yann Cres;
Maldives & Sri Lanka: N Sathiya Moorthy;

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