Nepal Maoists say peace process in danger

Maoist leaders stand in front of their party flags with their heads bowed during a minute of silence in memory of their slain comrades before the start of a ceremony in Kathmandu May 29, 2010.

KATHMANDU (Reuters) - Nepal's fledgling peace process that ended a decade-long civil war is in "danger", a top Maoist leader said on Thursday, amidst a political crisis that has gripped the Himalayan nation.

The Maoists gave up arms in 2006 to participate in elections. They emerged as the single largest political party and briefly led a coalition government that abolished the 239-year-old monarchy.

But since then, the alliance has collapsed and the Maoists' key demand of drafting a new constitution for the republic has been delayed, threatening the peace process.

"If this peace process does not succeed or it does not deliver the benefits to the real working masses of people then there will be a temptation to go back to war again," Baburam Bhattarai, seen as the party's number two, told Reuters.

Instability in Nepal has regional implications as its giant neighbours India and China are competing for influence over a country rich in hydro-electric potential.

The Maoists, who quit the government last year over a conflict on controlling the army, have demanded the ruling coalition resign and make way for a national unity government headed by them which would work to draft a constitution.

Allies of Prime Minister Madhav Kumar Nepal have said the Maoists must first dismantle their military camps. The Maoists last month supported an extension of the term of the parliament, which serves as a constituent assembly, by a year after the government agreed to resign.

"If the government does not resign and pave the way for a national consensus government, then we will have to again launch a series of struggles both within the constituent assembly and outside," Bhattarai said in the Nepalese capital.

The Maoists had choked the impoverished nation for six days in May in a crippling general strike.

Seated underneath portraits of Marx, Engels, Lenin, Stalin and Mao, Bhattarai blamed the crisis on monarchist and Hindu fundamentalist forces, whom he said wanted to "reverse the democratic gains."

"Those forces who resent change in Nepal don't want to see us ... leading the government."