In the wake of sustained mass protests in Nepal that forced King Gyanendra to step aside in late April, the Communist Party of Nepal (Maoist)—CPN (M)—reached an agreement on June 16 to enter the interim government, currently headed by Prime Minister Girija Prasad Koirala. The decision is a measure of both the depth of the crisis of bourgeois rule in Nepal and the political bankruptcy of the CPN (M), which is to become the latest in a long line of guerrilla outfits to exchange their military uniforms and automatic rifles for business suits and parliamentary seats.

Koirala signed the eight-point agreement with Maoist leader Pushpa Kamal Dhal, better known as Prachanda, during a meeting in Katmandu. Under the plan, the current parliament will be dissolved to make way for an interim administration that will include the CPN (M) and will operate under an interim constitution, which is currently being drafted. By May next year, elections will take place for a “constituent assembly” that will establish a new permanent constitution.

In comments to the media, Prachanda hailed the deal as “a historic decision” that “will move the country in a new direction”. The CPN (M), which has been fighting a guerrilla war since 1996, has agreed to dismantle its “people’s government” which holds sway in significant portions of rural Nepal and eventually integrate its fighters into the country’s military.

As far as Koirala and his seven-party coalition are concerned, the support of the Maoists is crucial. Even though the opposition parties were nominally in the leadership of the protest movement earlier this year, many people were suspicious of the party leaders, recalling the notoriously corrupt and unstable governments of the 1990s. While hostile to the autocratic rule of King Gyanendra, who suspended parliament in 2002, the protesters did not have great confidence in Koirala, head of the bourgeois Nepal Congress, or his leftist allies in the Communist Party of Nepal-United Marxist Leninist and the United Left Front.

By bringing the Maoists into the government, Koirala has temporarily defused the country’s civil war and bolstered the credibility of the interim administration. His home minister Krishna Prasad Situala declared: “We have reached the eight-point understanding to get the country out of the current crisis.” The government is counting on the Maoists to divert popular demands for more far-reaching democratic and social measures, particularly from young people who were central to the protest movement.

Koirala, a veteran bourgeois politician, is well aware that, for all its radical rhetoric, the main demand of the CPN (M) is for an end to the monarchy, not an end to capitalism. The party is based on the Stalinist two-stage theory, which insists that a democratic capitalist government is an essential first stage, relegating socialist demands to the distant future.

Far from ending the power of the monarchy and military, the Maoists are providing these reactionary forces with the opportunity to regroup. Significantly, while it has been noticeably quiet following the king’s decision to step aside, the Nepalese Army issued a statement on June 20 objecting to comments by Prachanda declaring the army was good for nothing but “murdering people and raping Nepali women”.

The army declared that it remained “committed to protect the country’s sovereignty, territorial integrity and dignity of the people under the direct command of the prevailing constitutional government”. On the same day, army headquarters issued a long shopping list of new arms, including rifles, ammunition, explosives, accessories and spare parts, armoured personal carriers, tanks, helicopters and aircraft.

In return for dismantling their own administration, the Maoists have received little. In addition to offering the CPN (M) ministerial posts, the Koirala government began releasing about 350 Maoist political prisoners in May and on June 12 agreed not to file new charges against those detained under anti-terrorism laws. The CPN (M) will also be free to campaign for seats in the constituent assembly.

The most sensitive issue is the disarming of the CPN (M)’s fighters. According to the joint statement issued by Koirala and Prachanda, the two sides have agreed to invite the UN “to help manage both sides’ weapons and monitor them” and also to monitor elections for the constituent assembly. In a deal reached last November with the seven opposition parties, the Maoists agreed to eventually disarm.

During an interview last week for state-run television, Prachanda declared that he would stand aside as supreme commander of his army once a new interim government was formed. “We are ready to put our army under the new prime minister. Then the guerrilla army would become the national army and no longer remain the Maoist army,” he said. No mechanisms have been spelt out, however.

Prachanda has been at pains to declare that the CPN (M) was committed to peace. “We will not go back to war,” he told the AFP news agency last week. He also denied UN allegations that his fighters had killed nine people since the ceasefire was signed in May. The Maoist leader insisted that only one such killing had taken place and that the perpetrator had been publicly punished.

While the Maoists are pushing for the abolition of the monarchy, the eight-point agreement does not commit the two sides to a republican constitution. In a bid to quell the mass anger at the actions of King Gyanendra, the parliament was forced to strip the monarchy of previous powers and privileges, including control over the army, legal immunity, tax exemptions and a veto over new laws. It did not, however, abolish the monarchy, which has been the crucial linchpin of the state apparatus.

Koirala has already indicated that he wants to establish a constitutional monarchy with the king as a ceremonial figure. Addressing his own Nepali Congress Party in Viratnagar on June 14, he warned: “If the king is not given breathing space, it might create a grave situation.”

Koirala’s remarks immediately sparked student protests. On June 16, students stormed two campuses in Katmandu, holding banners denouncing the monarchy and burning effigies of the king, to protest Koirala’s proposal to retain the monarchy. The CPN (M) held a rally and street meetings in southeastern Nepal and the party’s peace secretariat issued a statement criticising Koirala’s comments as “irresponsible”. Prachanda, however, has hinted that his party would accept the outcome of a referendum on a new constitution, even if it retained the monarchy.

The origins of the Maoist revolt

The CPN (M) has its origins in the mass protests in 1990 that forced the previous king, who had ruled with absolute power, to make limited concessions. Sections of the opposition movement were hostile to the decision by the major parties to accept a constitution in which the king retained huge powers, and were openly contemptuous of Koirala, who became the first elected prime minister in 1991.

A Maoist tendency founded by Mohan Bikram split from the Stalinist Communist Party of Nepal (CPN). Nirmal Lama formed the United Peoples Front (UPF), which contested the 1991 elections and won nine seats, with Prachanda among the MPs. Three years later, in May 1994, a faction around Prachanda split with the UPF, renamed itself the Communist Party of Nepal (Maoist) in March 1995 and in February 1996 launched the “armed struggle” against the monarchy. Its ideology was based on an eclectic mixture of Maoism and Nepal nationalism, mixed with chauvinist denunciations of India.

The Maoists were able to win a following in impoverished rural areas, recruiting youth to engage in a bloody war with the Nepalese army that has cost an estimated 13,000 lives. To maintain its hold, the CPN (M) has not hesitated to use the most ruthless methods. The party has not, however, gained any significant base of support in the main urban centres, such as Katmandu, and effectively sat on the sidelines in the course of the mass protests this year against the king.

Increasingly the CPN (M) has sought a means to return to mainstream politics. The pressure intensified after the Bush administration declared its “war on terrorism,” included the Nepalese Maoists on its list of terrorist organisations and began supplying the Nepalese army with arms and assistance. With the tacit assistance of the Indian government, Prachanda and other Maoist leaders travelled to New Delhi last November and struck an agreement with the seven-party opposition coalition for a joint struggle against King Gyanendra.

The Indian government had definite vested interests in such a deal. As well as maintaining Indian influence in Nepal, the deal sets a useful precedent to encourage peasant guerrilla tendencies in India itself to follow the same path. A decade and a half of “market reforms” in India has deepened the social divide and led to mounting unrest among country’s multi-millioned rural poor.

India had a hand in pushing King Gyanendra to step aside. Following a special cabinet meeting in late April, Indian Prime Minister Manmohan Singh dispatched special envoy Karan Singh to Katmandu to deliver a “strong message” to the king to relinquish his powers and reinstitute parliament. The latest agreement with the Maoists was reached only after a four-day visit by Koirala to India for discussions with Singh and other leaders. New Delhi clearly gave its blessing to the proposal for an interim government with the CPN (M), promising a $US218 million package of economic aid.

The Indian government has insisted, however, that the Maoists must unequivocally abandon the armed struggle and accept a place within the parliamentary arena. During Koirala’s visit, a spokesman for the India external affairs ministry told the media: “We support the peace efforts but the Maoists must abandon violence and accept the discipline of multi-party democracy.” India’s National Security Adviser M.K. Narayanan reportedly raised with Koirala the need to decommission the CPN (M)’s arms.

The Bush administration, which has previously opposed any incorporation of the Maoists into the government, has been even blunter. US ambassador James Moriarty told a public function in Katmandu last week that Washington still regards the CPN (M) as a terrorist organisation. “They have to change their action before we could provide assistance to the Maoists in any way or to a government which they will be part of,” he said. The US is one of Nepal’s largest donors.

There are already indications that the Maoists are preparing to jettison their previous anti-imperialist rhetoric. In an interview with Asia Times Online, senior CPN (M) leader Dev Gurang said there was absolutely no truth to the rumour that his party’s policy was to end private ownership of land and other property. According to a BBC report on June 22, Prachanda spoke approvingly of capitalist profit-making, saying that it could assist economic development.

Nepal is one of the poorest countries in the world. About 40 percent of the population is estimated to live below the poverty line. According to the government’s national living standard survey, over a million Nepali children toil as child labourers, with 127,000 involved in the worst forms of exploitation. Health, education and other basic services are virtually non-existent in many parts of the country. Far from ending these appalling conditions, the opening up of Nepal to “profit-making” will only exacerbate the social crisis.

By joining the government, the Maoists are offering to assist the ruling class to contain and suppress the opposition that will inevitably emerge from layers of working people, demanding decent living conditions and basic democratic rights.