Is the US reviewing its Nepal policy?

The US is rethinking its policy towards Nepal following the Maoists' certain victory in the crucial election that put its king to vote, US Ambassador to Nepal Nancy J Powell indicated on Monday.

Washington still regards the Communist Party of Nepal-Maoist as a terrorist organization, though the group formally laid down weapons in 2006 and joined the coalition government last year.

Powell met Speaker Subhash Chandra Nembang on Monday to discuss the developments, the formation of a new government and the first meeting of the newly elected constituent assembly that would formally announce the abolition of Nepal's centuries-old Shah dynasty of kings.

After the meeting, Nembang indicated that the US was now appraising its Nepal policy, official sources said.

Nepal's Election Commission Monday formally announced that the Maoists, once banned in Nepal and in neighbouring India as well, had captured half of the 240 seats that were in the direct fray in the April 10 poll.

Assured of their victory in the first national election in Nepal in nine years, Maoist chief Prachanda Saturday declared his intention to lead the new government himself.

Soon after the election, former US president Jimmy Carter had urged his government to "do business" with the Maoists since they had entered the peace process, taken part in a democratic election and were headed to emerge as the majority party.

Washington has been revising its Nepal policy since last year when the Maoists joined the government.

It has still not recognised them as a mainstream political party and accused them of violating the accord through continued extortion, abduction and other shows of force. But the US government relaxed its policy of stopping aid to governments that included parties regarded as terrorists by its State Department.

Powell told the speaker that in the coming days too the US government would continue its support for the Nepal government.

A shift in the US policy would be welcomed by the victorious Maoists, who have indicated after their triumph that they would like good relations with the international community and would not implement the revolutionary policies they advocated in the past, like capture of public property and its redistribution.

Instead, they say they would root for an industrial capitalist economy and would respect private investment and property.

The former ruling parties, the Nepali Congress of Prime Minister Girija Prasad Koirala and the Communist Party of Nepal-Unified Marxist Leninist (UML), have won only 37 and 33 seats respectively by Monday.

In the second phase of the election, in which 335 seats would be elected on the basis of proportional representation, the Maoists were surging well ahead of their rivals. They had garnered over 2.92 million votes of the total 9.66 million.