Sunday, July 15, 2007

Nepal: King seeks escape amid probe into wealth

King Gyanendra

Nepal's king seeks escape amid probe into wealth

Robbed of his legal powers by parliament, a despised king now faces being stripped of his vast riches

Dan McDougall in Kathmandu
Sunday July 15, 2007
The Observer

Plastered on the ancient moss-covered stone walls of a lane next to Kathmandu's opulent royal palace, a satirical poster depicts Nepal's King Gyanendra on the verge of madness. The monarch is pictured, gripped by fear and paranoia, sawing the legs from his huge gilded throne one by one.
Once the absolute ruler of this poverty-stricken Himalayan kingdom, in recent months King Gyanendra has been reduced to a shadow hovering over a power struggle between the Nepali government he ironically revived under huge public pressure for the return of democracy, and the Maoist rebels who have come in from the cold to join the new regime and ultimately depose him.
Stripped of all legal powers by the parliament he restored, it's not only his reign coming to an end. He could also lose the roof over his head and, ultimately, his freedom. The Nepali parliament last week announced its plans to return his palaces to the public. It is anticipated to be the first of many reclamations. Finance minister Ram Sharan Mahat's public accounts committee is investigating the true extent of the Nepali royal family's wealth, an inquiry that could end in corruption proceedings.
Yesterday the king was at the centre of a further row as Nepal's former Maoist rebels accused the government of misleading the public by creating a secret fund for him. Unveiling his 2007-2008 budget on Thursday, Mahat allocated no funds to the royal family. But later he admitted $385,000 (£189,000) had been set aside for the king under an account in the Prime Minister's office. The palace received $3.1m in the previous tax year.
'This is an effort to revive reactionary forces by cheating the people,' said senior Maoist leader Janardan Sharma, a member of the interim parliament. 'We oppose it.'
Meanwhile King Gyanendra hides away in one of his palaces, surrounded by his astrologers, counting his money and working out how to escape. His helicopter's engines are always whirring on the lawn, says constitutional lawyer Bhimarjun Acharya. The biggest task for the government at the moment is getting to the money, more important even than forming an amicable political alliance.
Gyanendra's destiny and that of his country changed forever in 2001 when his brother, King Birendra, and most of the rest of the Nepali royal family were killed in the bloodiest royal massacre of modern times. Despite public scepticism, the murders were officially concluded to have been committed by Prince Dipendra, Birendra's son, who shot his family and himself in a drunken rage after his parents refused to give him permission to marry the woman of his choice.
Four days after the massacre, Dipendra's widely-despised uncle, Gyanendra, was crowned. There were violent riots in Kathmandu over the accession, and his coronation carriage had to be surrounded by armed loyalists.
Gyanendra owns a number of properties and businesses, which include a large stake in the Soaltee Group, the third-largest business group in Nepal, with estimated net assets of $100m. The Observer has discovered at least the partial extent of the King's wealth, including a string of tea plantations, a golf course, at least four hotels, an island in the Maldives and oil interests in Nigeria.
But unravelling the tangled web of the royal wealth will be an impossible task given that many of these companies, hotels, palaces and resorts are not held directly in the king's name. His net assets - combined with those of his murdered brother and younger brother Dhirendra - are believed by some to make him one of the world's richest monarchs.
The most recent records put royal expenditure in 2004-2005 at about $10m a year, including the upkeep of around a dozen palaces. Of this, around $3m was spent directly by the king and his family, usually on foreign holidays.
The king also owns three luxury cars, including two bullet-proof Mercedes. The palaces include vast compounds in Kathmandu, Ratna mandir palace in Pokhara, the King's traditional summer residence, Diyalubangla in Chitwan and homes in Nagarjuna and Gokarna.
The palaces would be the easiest assets to reclaim, a government source told The Observer this week. They were guarded by the military but troops would not stand in the way when they were taken back, said one government source.
According to insiders the King expects to lose his palaces but not his business interests. The Observer has learned that Gyanendra's 40 per cent stake in the Soaltee Crowne Plaza Hotel in Kathmandu and his part ownership of the Golkarna golf course Resort, currently leased to Le Meridien, are not held in his name. He owns a brewery, a tobacco company and countless factories, and his wayward son and heir, Paras, oversees his foreign business assets, including oil interests in Africa. Paras holds a 54 per cent stake in one of the biggest tea companies in Nepal, Himalayan Goodricke, and a tea estate and vast spice plantation in the Eatahari region.
'We are looking at his business interests but there are so many it is taking us a lifetime to get through them,' said the government source. There is also the issue of nine tonnes of gold which has gone missing from Nepal's national coffers.
Even the British taxpayer has been propping up the king's lavish lifestyle. Each year, in return for the Gurkhas recruited by the MoD, the king receives part of a British government stipend estimated at about £600,000. For how long he receives such gifts is open to question. Last month the British ambassador boycotted the King's birthday.

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