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Nepal has been a member state of the United Nations since 1955. It is as such obliged to abide by its charter and sanctions. The global body has over the years imposed various sanctions on the North Korean regime for its develop­ment of nuclear weapons and its vio­lations of the UN charter. This is why no UN member country can in any way abet the North Korean regime in its pursuit of nuclear weapons. Nepal seems to be in violation of these sanctions.

Nepal is host to dozens if not hundreds of North Korean nation­als. Most of them came here on legal business visas and have since opened up various businesses, most notably four restaurants, a couple of IT companies and even a hospital in Damauli in Tanahun district. But the majority of the North Koreans employed by these establishments have no work permits. Many busi­ness visas have lapsed too.

For instance, 14 North Koreans currently work at the Botonggang Restaurant and Bar at Kamaladi, Kathmandu. None has a work per­mit. Korea Pyongyang Arirang in Durbar Marg is another restaurant where North Koreans are working without a permit. Under Nepali laws, foreign investors are allowed to stay here on business visas, but their employees have to have work permits.

The majority of the North Koreans employed by these establishments have no work permits

Most North Koreans working in Nepal are on business (not work) visas, and the North Korean Embas­sy in Kathmandu facilitates their stay and work here. The fear is that their investments in Nepal could end up in the hands of the rough North Korean regime, which is notorious for operating illegal businesses in other countries to cover its expenses at home.

North Korean entrepreneurs have been steadily expanding their invest­ment in Nepal, even though the UN has repeatedly asked us to enforce its sanctions against North Korea. So have the US, Japan, South Korea and a number of European countries.

No one really knows what North Korean workers do while they are in Nepal

Besides the UN, the US, the EU and Japan, all important donors to Nepal, have their own sanctions against North Korea and they don’t look kindly on countries that are in violation of their sanctions. But Nepal’s communist government seems to be in no mood to enact any sanction against North Koreans. In fact, it is allowing more and more North Korean businesses to operate in this country. PM KP Oli is said to have a soft spot for North Korea. Another senior leader Madhav Nepal has long been a North champion. Home Minister Ram Bahadur Tha­pa has even assured North Korean businessmen in Nepal that he will personally bail them out should they run into any trouble.

We have no problem with foreign nationals running legal businesses here. But most North Koreans work­ing in Nepal are doing so illegally. And no one really knows what they do while they are in Nepal. For Nepal to be considered a responsible mem­ber of the global community the gov­ernment should be mindful of the country’s international obligations.

North Koreans freely investing in Nepal by defying UN sanctions

Foreign ministry officials believe Nepali leaders should not bat for North Korea, lest it annoys the UN and other powerful countries with which Nepal has strong economic ties. Yet even UN officials in Kathmandu are lukewarm about imposing sanctions on North Koreans

North Korean entrepreneurs have been steadily expand­ing their investment in Nepal, even though the UN has repeatedly asked Nepal to enforce its sanctions against North Korea. So have the US, Japan, South Korea and a number of European countries.In adherence with the sanc­tions, all UN member countries are required to, as reported in Global News, “freeze the assets of people identified as being engaged in or providing support for North Korea’s nuclear, weapons of mass destruc­tion and missile programs.” Most North Koreans working in Nepal are on business (not work) visa, and as the North Korean Embassy in Kathmandu directly facilitates their stay and work here, the fear is that their investments in Nepal could end up in the hands of the rough North Korean regime. The regime is notorious for operating illegal busi­nesses in other countries to finance its expenses.

UN member countries are also required to “not allow these people to travel into their territories, unless they’re citizens there,” “freeze the assets of and ban anyone deter­mined to be working for these iden­tified people,” and “if the identi­fied people are from North Korea, deport them back there.”

Multiple sources, at both Home and Foreign ministries, reveal that Prime Minister KP Oli, Home Minis­ter Ram Bahadur Thapa and Foreign Minister Pradeep Gyawali all assure high-level foreign diplomats that they are serious about enforcing the UN sanctions.

But the Nepal government has taken no step towards that end. In fact, it appears to be doing the opposite. Until recently, the North Koreans were running just one restaurant in Durbar Marg in Kath­mandu, but now they have obtained permission for three more. They are also running a hospital (N-Koryo Hospital) in Tanahun and two IT companies (HimalChilbo Technical Solution Pvt Ltd in Lalitpur, and Yong-Bong-Chand IT Company in Kathmandu)—all under the direct patronage of the North Korean Embassy in Kathmandu. Whenever North Korean businesses encoun­ter problems at Nepali government offices, embassy officials pay them a visit straight away.

Nepali communist leaders argue the investments of North Koreans should not be viewed through a western lens

Arirang, what, how?

The North Koreans are in the final stages of the preparations for open­ing a couple of new restaurants in Lazimpat and Thamel. They have also bought another restaurant, Botonggang Restaurant and Bar, in Kamaladi (pictured alongside) from some Chinese nationals. As many as 14 North Koreans, all here on busi­ness visas, are currently employed there. None has a work permit. Korea Pyongyang Arirang in Durbar Marg is another restaurant where North Koreans are working without a permit. Under Nepali laws, foreign investors are allowed to stay here on business visas, but their employees have to have work permits. Only after the recommendation of the Department of Industry does the Department of Immigration issue visas for foreign workers.

Most workers employed by the two IT companies mentioned above are in Nepal on business or tourist visas. The visas for three of their employeesexpired on Jan­uary 2 but they continue to live and work in Nepal illegally. Exactly what kind of work these illegal workers and the IT companies that employ them are doing here remains opaque to government (including security) officials.

Deep political nexus

Nepal and North Korea estab­lished diplomatic relations on 15 May 1974, and leaders of the two countries have maintained close ties. Many Nepali politicians, includ­ing former prime ministers Tanka Prasad Acharya, Kirti Nidhi Bista and Madhav Kumar Nepal, have visited North Korea.

Madhav Nepal remains an influen­tial leader in the ruling Nepal Com­munist Party (NCP). Other left-lean­ing leaders from various parties—Narayan Man Bijukchhe Rohit, CP Mainali, Speaker Krishna Bahadur Mahara, among others—as well as some businesspeople have also vis­ited North Korea. Prime Minister KP Oli, Home Minister Ram Bahadur Thapa, Industry, Commerce and Supplies Minister Matrika Yadav and former prime minister and NCP Co-chair Pushpa Kamal Dahal also have strong ties with North Korea. Most importantly, PM Oli is said to be positive toward North Korean investment in Nepal.

Not just Oli, most communist leaders of Nepal are not in favor of enforcing the UN sanctions against North Korea. The primary reason behind this is ideological. The North Koreans are confident that their investment remains safe under Nepal’s communist govern­ment. Home Minister Thapa has had meetings with officials from the North Korean Embassy in Kathman­du on many occasions. According to ministry sources, Thapa has told North Korean officials to come to him immediately should they run into any problem, and has assured them that the government would protect their investments in Nepal. Sources also claim that the embassy officials visit the ministries of Home or Industry whenever they face even minor problems.

Having been assured of support from the two ministries, the North Koreans have increased their invest­ment in Nepal. Nepali communist leaders argue that the presence and investments of North Kore­ans in Nepal should not be looked through a western lens. Says one such high-ranking NCP leader, “The two countries have diplomatic rela­tions. We should view North Kore­an investment with our own lens. Viewing it through a foreign lens can upset diplomatic balance.”

MoFA consensus

Officials from the Ministry of Foreign Affairs (MoFA) refuse to comment on record on wheth­er Nepal should enforce the UN sanctions against North Korea. In informal conversations, how­ever, they express their support for the sanctions. They argue that top Nepali leaders should not bat for North Korea, lest it annoys the UN and other power­ful countries with which Nepal has strong economic partnerships. In the wake of two failed summits between the US and North Korea, MoFA officials are not optimistic about any easing of sanctions. They say the decision on whether to enforce the UN sanctions cannot be taken at a bureaucratic level. “A political decision is required. The sanctions will be enforced imme­diately if the government makes a formal decision,” says a high-level MoFA official.

In the third week of March, US Secretary of State Michael Pompeo had written a letter to PM Oli con­gratulating him on completing his first year in office. But it was not only a congratulatory message. The letter clearly mentions Foreign Minister Pradeep Gyawali’s assur­ances on enforcing the UN sanc­tions against North Korea during his recent US visit. Pompeo had inquired about North Korean pres­ence and investments in Nepal in his meeting with Gyawali. Randy Berry, the US Ambassador to Nepal, has also repeatedly raised this topic with PM Oli and NCP Co-chair Dahal. So have senior diplomats from other countries. But the Nepal govern­ment remains indifferent.

Strangely, besides expressing occasional concern with the Nepal government, those in the know say even UN officials in Kathmandu are lukewarm about imposing the sanc­tions on North Koreans working illegally in Nepal. While writing this story, multiple attempts to get the UN version of what it was doing to put pressure on the government were rebuffed.

By Shambhu Yadav | Siraha

 Province 2 government has spent millions on the ‘Save daughter, educate daughter’ campaign. Meanwhile, in a blatant travesty of the cam­paign, Provincial State Min­ister for Industry, Tourism, Forest and Environment Suresh Mandal has paid for the wedding of a 14-year-old girl from Siraha. In the past few months, the police have prevented as many as seven child marriages in the district.

On April 24, Radha Mal­lik (Dom), a Dalit girl from Kalyanpur municipality, was married to Ajaya Mallik from the district of Dhanusha in the presence of Mandal. Hun­dreds of thousands of rupees were spent on tents, food, jew­elry and clothes by the minis­ter and ward chairman Ashok Mandal. Minister Mandal has been consistently defending his action, arguing that arrang­ing a wedding ceremony for a poor Dalit’s daughter is no sin.

The bride is nowhere close to the legal age for marriage in Nepal. The General Criminal Code Act, which came into effect on 17 August 2018, stipu­lates that a man and a woman can get married only after they turn 20. Radha’s birth certifi­cate says she was born on 23 April 2005—which means she turned 14 only a day before the wedding.

Nobody has reported Radha’s marriage to the police yet. If someone files a complaint, we will initiate action against the alleged culprits

Madhav Raj Kharel DSP of Siraha

Rights activists enraged

The wedding has attracted the attention of several human and child rights organizations in Siraha. On April 27, they issued a press release stating that child marriage is unjusti­fiable and demanding action against minister Mandal. Arranging a child marriage is punishable by law. Every year, many mothers and infants die because of the severe adverse effects of this social scourge. Countless other women are deprived of educational and other opportunities.

Locals say Radha stopped going to school when she was in Grade 2. Rajkumar Raut Kurmi, a human rights activ­ist, says that it is unfortunate that a girl, instead of being encouraged to study further, has been married off. He adds that minister Mandal’s action has dented the provincial government’s ‘Save daughter, educate daughter’ campaign. “A minister should be actively fighting a social evil like child marriage. But here is one who helps arrange it. This is wrong,” says Kurmi.

Waiting for a complaint

DSP Madhav Raj Kharel, the spokesperson for the District Police Office Siraha, says that if someone files a complaint, his office would initiate action against the alleged culprits. “But nobody has reported Radha’s marriage to the police yet,” says Kharel. It is possible that people fear the repercussions of registering a complaint involving a minister.

One of the Sustainable Development Goals that the Nepal government hopes to achieve by 2030 is to end child marriage in the country. The ‘Save girls, educate girls’ campaign is meant to aid the abolition of child marriage in Province 2.

 Nearly four years after the promulgation of the consti­tution, the National Natural Resources and Fiscal Commission (NNRFC), a constitutional body man­dated to ensure just and equitable distribution of natural and fiscal resources among the three tiers of government, has started its work after the appointment of former secretary Balananda Poudel as its chairman last month.

Earlier, the NNFRC Secretariat consisting only of government offi­cials had conducted some prepara­tory work but the commission was largely dysfunctional in the absence of a chairperson. The government is yet to appoint the other four mem­bers of the commission, which is also likely to affect its work. After taking charge of the commission, Poudel has started consulting with stakeholders to prepare a work plan that would guide the commission’s short- and long-term tasks.

“It has been a month since I joined. In this time we have prepared a draft of a law relating to natural resources, and are working on both our short-and long-term goals,” says Poudel. He adds that his office is also working out a strategy for effective communi­cation with federal, provincial and local governments.

 Major duties of the commission as identified by the constitution and law

• To make recommendations on equalization grants to be pro­vided to the provincial and local governments out of the federal consolidated fund.

• To carry out research and define parameters for condi­tional grants to be provided to the provincial and local gov­ernments in accordance with national policies and programs, norms, standards, and the state of infrastructures.

• To determine a detailed basis and modality for the distribu­tion of revenue between the provincial and local govern­ments out of the state consoli­dated fund.

• To recommend measures to meet expenditures of the feder­al, provincial and local govern­ments, and to reform revenue collection mechanisms.

• To analyze macro-economic indicators and recommend ceilings on internal loans that the federal, provincial and local governments can take out.

• To review the basis for revenue distribution between the feder­al and provincial governments and recommend revisions.

• To set bases for the determi­nation of shares of the feder­al, provincial and local gov­ernments in investments and returns and in the mobilization of natural resources.

• To conduct research on pos­sible disputes between the federation and the provinces, between provinces, between a province and a local level, and between local levels, and make suggestions on ways to prevent such disputes.

• To carry out environmental impact assessment required in the course of distribution of natural resources, and make recommendations to the government.

Underpinning federalism

The commission’s role is crucial in the transformation of the old unitary state structure into a functional fed­eral one. While the unitary system had the provision of distributing projects from top to bottom, funds would be transferred from one level of government to another under the federal model. An effective NNRFC can significantly reduce the chances of disputes among the three levels of government—federal, provincial and local. Most such disputes are over natural resources and revenue distri­bution; and the commission is man­dated to make recommendations on revenue distribution, equalization grant, conditional grant, internal borrowing and sharing of natural resources among the three govern­ments. An equitable and fair shar­ing of natural and fiscal resources among the three governments is a challenge, but is a prerequisite for the effective functioning of the new federal model.

As the commission is a constitu­tional body, its recommendations are binding on all three levels of government. The commission can essentially force any level of government to imple­ment its recommendations. Addi­tionally, the role of the commission is akin to that of ‘a referee’ when it comes to implementing fiscal federalism. If the NNRFC functions effectively, it will enable all levels of government to make informed and evidence-based decisions.

The constitution has made pro­visions regarding the distribution of revenue among the federal, pro­vincial and local level entities. Taxes such as custom duty, excise duty, Value Added Tax (VAT) and income tax are under the federal government’s jurisdic­tion, while house and land registration fees, motor vehicle tax, agro-income tax and local taxes are within the remit of the provin­cial and local govern­ments.

Three levels of funding

There are clear fiscal gaps at the provincial and local levels as they have to deliver services that require much more money than what they can collect in revenue. As such, the central gov­ernment has to make fiscal transfers to the provincial and local lev­els to bridge the gaps. Similarly, the center needs to mobilize the provincial and local lev­els to implement com­prehensive national pol­icies and programs. This is where the NNRFC comes in.

While recommending revenue distribution, the commission will have to take into account certain criteria and frameworks such as population and demographic fac­tors, area, human development index, expenditure needs, revenue collection efforts, infrastructure development, etc.

The commission is working on forming four thematic divisions, namely Revenue Sharing Division, Research and Management Division, Sharing of Natural Resources Divi­sion, and Grant and Loan Manage­ment Division. The Intergovernmen­tal Fiscal Management Act (2017) is already there to manage matters related to revenue rights, revenue sharing, budget management, pub­lic expenditure and fiscal discipline among the federal, provincial and local level entities.

This Act has identified issues such as revenue and expenditure respon­sibilities, intergovernmental fiscal transfers and internal loans provin­cial and local entities can take out as the important elements of fiscal federalism. Last year, the commis­sion recommended the government on revenue sharing and fiscal equal­ization grants for the fiscal 2018-19— before Poudel joined it.

Poudel says his immediate prior­ity is to settle issues related to the distribution of revenues and royal­ties collected from natural resourc­es. Observers say the commission needs collaboration from all three tiers of governments to function effectively.

Lack of seriousness on the part of political par­ties and their ‘delay tactics’ have increased the risk of ‘international intervention’ in Nepal’s Transitional Justice (TJ) process, which has not made substantial progress since the sign­ing of the Comprehensive Peace Agreement (CPA) in November 2006. Experts and observers say failure to amicably settle war-era human rights cases would attract the wrong kind of international attention. Avert­ing such a scenario requires Nepal to address the issue through credible national mechanisms by taking all stakeholders on board. But major par­ties that have been in power since the start of the peace process seem indifferent.

Of late, the international community has piled up pressure on the government to settle the tran­sitional justice process, a vital part of the peace process, at the earliest. In January, the United Nations in Kathmandu, together with nine foreign embassies, urged the government to clarify how it intends to take the TJ process forward, to great annoyance of the government and the ruling party leaders.

This month, five special rapporteurs under the United Nations High Commissioner for Human Rights wrote a 10-page letter to Foreign Minister Pradeep Gyawali seeking transparency and close consultation in selection of members of the two transitional justice mechanisms, namely the Truth and Reconciliation Commission (TRC) and the Commission on Investigation of Enforced Disappeared Persons (CIEDP). Gyawali has repeat­edly assured the international community that there will be no blanket amnesty, but the commit­ment has not been translated into action.

 'I have an impression that the army will keep its cards close to its chest until there is a broad political agreement'

Binoj Basnyat,a retired Nepali Army major-general

Dare not fail us

Conflict victims, though divided on some issues, are getting impatient and losing hope. “Parties want to derail this process by employing delay tactics. They are yet to consult with us on how to amend the law and conclude the TJ process,” says Suman Adhikari, former Chairman of the Conflict Victims Common Platform, an umbrella body of activists seeking justice and repa­rations.

Conflict victims say if national mecha­nisms fail them, they will have no alterna­tive but to internationalize this issue. In fact, some have already approached the UN and other international organizations for justice. The recent visit of the Nepal Communist Party Co-chairman Pushpa Kamal Dahal to the US, ostensibly for his wife’s treatment, also highlights the gravity of the TJ process. A complaint was filed at the Federal Bureau of Investigation to arrest Dahal and investigate war-era human rights violations, which forced the US government to issue a ‘no investigation’ circular.

Those complicit in rights violations can be arrested anywhere in the world under the principle of ‘universal jurisdiction’ of human rights. Earlier, Kumar Lama, a senior Nepal Army official, was arrested in the UK on charges of war-era violations. (He was later tried and acquitted.)

“If the ongoing national process fails to end pervasive impunity and deliver justice and reparations to the victims, they will knock on the doors of the United Nations or international courts,” says Geja Sharma Wagle, a political analyst who has been closely involved in the peace process. “But internationalizing the TJ process would be suicidal for the government as well as the ruling and opposition parties. As such, this process should soon be concluded by tak­ing conflict victims into confidence.”

It has been almost 13 years since the CPA was signed, but one key aspect of the peace process—providing justice to conflict victims—is still prickly. As per government data, around Rs 166 billion has already been spent on the peace process. But there has been little progress on the TJ front. The office bearers of the two commissions—the TRC and the CIEDP, which were set up in 2015—recently took retirement, and the government has formed a panel for new appointments.

Deadly delay

Experts, however, say having new faces would not be sufficient. They are of the view that the TRC Act should be amended in line with the Supreme Court verdict, which means the TJ process should meet interna­tional standards, and amnesty should not be given on serious rights violations such as rape, torture, killings, and disappearances. Additionally, the commissions should be empowered to recommend legal action against those involved in grave violations.

A former TRC member blames lack of support from political leadership, failure to amend the law, and inadequate resources for the two commissions’ dysfunction. No amendment to the law means a continu­ation of the same tendencies for the next five years. “It seems that some ruling party leaders think they can kill this process by using delay tactics, but that is not possible. The delay would only erode trust in our national mechanisms and attract interna­tional interest,” says a high-level official familiar with the process.

Mounting international and domestic pressure has made some leaders from both the ruling and opposition parties realize the importance of concluding the TJ process through national mechanisms. But ex-Mao­ist leaders are reluctant to go by the SC ver­dict. By and large, the former rebels want to settle the process through reparations, but this alone will not be acceptable to the international community or to the conflict victims. Although the erstwhile CPN-UML leaders are receptive to the idea of amend­ing the law in line with the SC verdict, Prime Minister KP Oli is under pressure from co-chair Dahal not to do so.

Among others, the issue of transitional justice was one reason for the unification in 2017 between the two communist par­ties led by Oli and Dahal respectively. Oli has reportedly assured Dahal that no case would be filed against him in national or international courts.

On war-era cases, the Nepal Army and the main opposition Nepali Congress hold sim­ilar positions to that of the government. NC President Sher Bahadur Deuba had served as the prime minister while the Maoist conflict was at its peak and had imposed an emergency; he fears he could be dragged into war-era cases, and therefore prefers almost blanket amnesty in those cases.

Binoj Basnyat, a retired Nepali Army major-general, says, “The army proceeds as per the government’s decision regarding gross rights violations during the conflict. So, first, a common political direction that meets international principles and national rules on human rights needs to be charted. I have an impression that the army will keep its cards close to its chest until there is a broad political agreement.”

The politicization of war-era cases in the past decade has also complicated the TJ process. Initially, the cases were used by the parliamentary parties against the Maoists as a bargaining tool. Mainly, the former insur­gents were threatened that war-era cases could be taken to international courts. Not only political parties, some human rights groups and individual activists also created unnecessary uproar about transitional justice. While some advocated blanket amnesty, others talked about international courts, both of which were against the principles of transitional justice. Now, such voices have become faint.

Currently the two transitional justice commissions are without leadership. The government on March 25 formed a five-member committee led by former Chief Justice Om Prakash Mishra to select two chairpersons and members. The govern­ment claims to be working to amend the transitional justice laws in line with the SC verdict, but there is no public discussion on it. Together, the two transitional justice commissions have received around 66,000 war-era complaints but preliminary inves­tigation has been conducted on very few of them.