On 4 February 1996, Bhattarai gave the government, led by Nepali Congress Prime Minister Sher Bahadur Deuba, a list of 40 demands, threatening civil war if they were not met. The demands related to "nationalism, democracy and livelihood" and included such line items as the "domination of foreign capital in Nepali industries, business and finance should be stopped", and "discriminatory treaties, including the 1950 Nepal-India Treaty, should be abrogated" (referring here to the 1950 Indo-Nepal Treaty of Peace and Friendship), and "land under the control of the feudal system should be confiscated and distributed to the landless and the homeless."[10] After that, and until 26 April 2006, Prachanda directed the military efforts of the CPN(M) towards establishing areas of control, particularly in the mountainous regions and in western Nepal.In late 2004 or early 2005, relations between Prachanda and Baburam Bhattarai soured.[12] This was reportedly due to disagreement on power sharing inside the party. Bhattarai was unhappy with the consolidation of power under Prachanda. At one point, Prachanda expelled Bhattarai from the party, though he was later reinstated.[13] They later reconciled at least some of their differences.After the king's direct action over the government on 1 February 2005, the CPN (Maoist) met in serious discussions over the future policy of the party. Until then, Comrade Prachanda, Comrade Kiran and others were convinced that they would be able to rise to power just by having a dialogue with the king's government. Senior leader Dr. Bhattarai had rejected this idea of the party, ever since it came under discussion in the party. He insisted joining with other 'mainstream' parties. He proposed working with other parties to abolish the monarchy, and stressed that it was high time to work with other parties to establish a republic. He stated that the party should move ahead with a strategy of a democratic republic and a multiparty system for a time being, as the other parties would not accept a people's republic immediately. The majority of the other senior leaders had rejected his opinion from the beginning, including chairman Prachanda, and had made a decision to work together with the king.Dr. Bhattarai and his supporters were punished and suspended for putting a view contrary to the party decision. But after the King's proclamation on 1 February 2005, the party realised that the policy they were pursuing was wrong. Immediately Dr. Bhattarai was released from his punishment and, in a meeting held at Chunbang (a village in Rolpa), the party discussed Bhattarai's ideas. After which, the party came forward with a strategy of a democratic republic rather than a people's republic. Dr. Bhattarai's strategy has worked until now; it put forward the party as a major stakeholder in the nation's politics. Chairman Prachanda and Dr. Bhattarai seem to disagree with the strategy of the other senior leader—Mohan Vaidya alias Kiran. The two leaders agree to strengthening the newly established democratic republic, rather than implementing a people's republic immediately.
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