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Background: In 1951, the Nepalese monarch ended the century-old system of rule by hereditary premiers and instituted a cabinet system of government. Reforms in 1990 established a multiparty democracy within the framework of a constitutional monarchy. A Maoist insurgency, launched in 1996, gained traction and threatened to bring down the regime, especially after a negotiated cease-fire between the Maoists and government forces broke down in August 2003. In 2001, the crown prince massacred ten members of the royal family, including the king and queen, and then took his own life. In October 2002, the new king dismissed the prime minister and his cabinet for "incompetence" after they dissolved the parliament and were subsequently unable to hold elections because of the ongoing insurgency. While stopping short of reestablishing parliament, the king in June 2004 reinstated the most recently elected prime minister who formed a four-party coalition government. Citing dissatisfaction with the government's lack of progress in addressing the Maoist insurgency and corruption, the king in February 2005 dissolved the government, declared a state of emergency, imprisoned party leaders, and assumed power. The king's government subsequently released party leaders and officially ended the state of emergency in May 2005, but the monarch retained absolute power until April 2006. After nearly three weeks of mass protests organized by the seven-party opposition and the Maoists, the king allowed parliament to reconvene in April 2006. Following a November 2006 peace accord between the government and the Maoists, an interim constitution was promulgated and the Maoists were allowed to enter parliament in January 2007. The peace accord calls for the creation of a Constituent Assembly to draft a new constitution. The Constituent Assembly elections, already twice delayed, are set for April 2008. (Source: CIA—The World Factbook)
Security Assistance Funding: (Source: 2009 Congressional Budget Justifications for Foreign Operations)
($ in thousands)
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Direct Commercial Sales: (Source: 2007 Section 655 Report)
In FY 2007, the Department of State authorized the export of defense articles and services valued at $696,838.