(FINAL DRAFT)

NEPAL:STAYING ENGAGED IN CONFLICT

Experiences and lessons learnt fromConflict Sensitive Programme Management (CSPM)

in fragile context with armed conflict

Thania Paffenholz

November 14, 2006

ASIA BRIEF: APPROACHESEXPERIENCES AND LESSONS LEARNTFROM CSPM IN NEPAL

SDC Swiss Agency for Development and Cooperation – East Asia Division

ASIA BRIEF: APPROACHESEXPERIENCES AND LESSONS LEARNTFROM CSPM IN NEPAL

ASIA BRIEF: APPROACHESEXPERIENCES AND LESSONS LEARNTFROM CSPM IN NEPAL

SDC Swiss Agency for Development and Cooperation – East Asia Division

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Table of Contents

List of Abbreviations..............................................................................................................3Executive Summary ...............................................................................................................41 Introduction .....................................................................................................................6

1.1 Background..........................................................................................................................61.2 Objective and purposes........................................................................................................71.3 Research Methodology and Process....................................................................................71.4 Structure of report ................................................................................................................8

2. Understanding development work in fragile, conflict countries.................................82.1 The international debates.....................................................................................................8

2.1.1 Conflict sensitivity in International Cooperation.............................................................82.1.2 The Fragile States Debate..........................................................................................10

2.2 The understanding within SDC...........................................................................................112.2.1 Peacebuilding and Conflict Sensitive Development in SDC ........................................112.2.2 The fragile states debate within SDC..........................................................................11

3. Development and armed conflict in Nepal..................................................................123.1 The development context of Nepal .....................................................................................123.2 Armed conflict in Nepal.......................................................................................................133.3 The Maoists and development............................................................................................143.4 International Responses.....................................................................................................15

4. Adapting the SDC Nepal country programme to the fragile, conflict context .........174.1 The Swiss engagement in Nepal prior to the adaptation: 50 years of developmentcooperation....................................................................................................................................174.2 Overview of programme adaptation process ......................................................................174.3 Main strategic decisions, approaches and instrument of programme adaptation ................19

4.3.1 Staying engaged with a development programme ......................................................194.3.2 Introduction of Swiss geographical cluster areas throughout the country....................214.3.3 Engagement in donor coordination/harmonization ......................................................224.3.4 Introduction of a Joint Swiss Programme....................................................................234.3.5 From government to people-centred PRSP focussing on livelihood, inclusion and

human security ...........................................................................................................244.3.6 Special programme component for human rights and peacebuilding ..........................26

5. Lessons Learned...........................................................................................................275.1 Lessons for why and how to ‘stay engaged’ .......................................................................275.2 Lessons Learned for programme management in different development contexts .............305.3 Lessons Learned for a comprehensive strategy for staying engaged .................................325.4 Lessons Learned for useful instruments when staying engaged.........................................365.5. Lessons about comparative advantage of Switzerland .......................................................37

6. Recommendations........................................................................................................386.1 General recommendation for programme adaptation processes ........................................386.2 Recommendations for SDC and especially for COPRET....................................................39

Bibliography .........................................................................................................................40

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Figures/Boxes:- Effective use of MERV for conflict monitoring and flexile

programme adaptation............................................................................................. 22- Local Risk Assessment: A tool to analyse the space for development in

conflict affected areas .............................................................................................. 24- The Swiss umbrella as a tool for operating in conflict situations............................... 24- The Swiss intervention at the World Bank Board in Washington .............................. 26- Programme management in different development contexts.................................... 34- A comprehensive intervention strategy for fragile, conflict contexts.......................... 35- Entry points for peacebuilding at local level - SDC’s experiences ............................ 38

Annexes: ...................................................................................................................... 48

Annex 1: Research Framework

Annex 2: The Swiss Nepal programme: overview of components

Annex 3: Executive summary: CSPM-Mission report February 2006

Annex 4: Executive Summary: Report: Bridge Building in Times ofArmed Conflict: Peace and Conflict Assessment of TBSSP

Annex 5: Basic Operating Guidelines (BOGs)

Annex 6: Example of a MERV produced by the SDC Nepal COOF

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List of Abbreviations

ADB Asian Development Bank

BOG Basic Operational Guidelines

COPRET Conflict Prevention and Transformation (SDC’s conflict unit at headquarters)

COOF Cooperation Office (SDC’s offices in partner countries)

CPN (UML) Communist Party of Nepal (Unified Marxist-Leninist)

CPN (M) Communist Party of Nepal (Maoist)

CSPM Conflict Sensitive Programme Management

DAC Development Assistant Committee of the OECD

DAGs Disadvantaged and poor groups

DFA Federal Department of Foreign Affairs

DFID Department for International Development (British Development Ministry)

DRSP District Roads Support Programme

DTMP District Transport Master Plan

GTZ Gesellschaft für techn. Zusammenarbeit (German Development CooperationAgency)

ICG International Crisis Group

LRA Local Risk Assessment

MDGs Millennium Development Goals

MERV Monitoring entwicklungsrelevanter Veränderungen (SDC’s internal EarlyWarning Monitoring Instrument)

NGOs Non-governmental Organisations

OECD Organization for Economic Cooperation and Development

PCIA Peace and Conflict Impact Assessment

PD IV Political Division IV (Human Security Division within DFA)

PRS(P) Poverty Reduction Strategy (Papers)

SDC Swiss Agency for Development and Cooperation

SECO State Secretariat for Economic Affairs

TBSSP Trail Bridge Sub-Sector Project

TORs Terms of Reference

UNDP United Nations Development Programme

UNHCHR Office of the United Nations High Commissioner for Human Rights

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Executive SummaryThe Swiss Agency for Development and Cooperation (SDC) in Nepal adapted its countryprogramme to the situation of armed conflict in the years from 2003 to 2005. After great effortand many achievements both on the political as well as the operational side of theprogramme the ‘Conflict Sensitive Programme Management’ (CSPM) and a Joint SwissStrategy for Nepal, combining Swiss development with diplomatic peace and human rightsstrategies, were introduced and further developed. In order to learn lessons from theseexperiences for future work in Nepal, as well as for development work in other fragile conflictcontexts, a project was started to document and analyse the CSPM experiences in Nepal.This report presents the project results.

Switzerland has an almost 50 year history of development cooperation in Nepal; it is apriority country for the Swiss Development Cooperation (SDC). Traditionally the SDC hasbeen and still is engaged in the rural areas of Nepal with a geographical focus on the centralhilly regions. The programme has been built on the development sectors of forestry and soilconservation, rural infrastructure (roads and bridges) and vocational training. The mainpartners have always been government agencies, international and local NGOs that workedprimarily with local user committees.

The SDC country programmes had not considered the conflict situation prior to 2002, whenin an addendum to the country strategy 1998-2004, and then in the 2005 countryprogramme, the armed conflict was a central theme. However, in the local contexts, projectsalready accounted for conflict situations. The focus on armed conflict became necessary asstaff and beneficiary security had been at risk, and the government started to experiencedifficulties in delivering services to most rural areas.

The core strategic decision for adapting the programme to the conflict situation was to stayengaged with the development programme throughout the armed conflict. The maininstruments used to stay engaged in Nepal include conflict and security analysis; monitoringthrough local risk assessments; the extensive use of MERV (SDC’s internal developmentenvironment monitoring instrument); as well as a permanent lobby for and defence of thespace for development vis-à-vis the conflict parties jointly with other donors and agencies.

The introduction of a joint Swiss Programme for Nepal that combines Swiss developmentand diplomatic peace and human rights efforts was also a fundamental strategy in support ofthe strategic decision to stay engaged, e.g. make development possible.

SDC also took a proactive advocacy and agenda setting role within the different donorforums in Nepal and internationally; thereby contributing to essential joint actions of theinternational community.

The general direction of the programme in support of a Government Poverty ReductionStrategy (PRS) became difficult as the government, in a fragile state, could not be the centralactor for development because it could not perform its envisaged PRS coordination function.Due to the conflict situation the transformation of the armed conflict was therefore put at thecore of the programme objectives.

The Swiss programme addressed both the political and the social causes of conflict: in orderto address the deeper social causes of conflict inclusion of disadvantaged groups (DAGs)and (to a lesser extent) neglected geographical areas into all project activities took place.The programme also was changed in order to address the consequences of armed conflictwith a focus on human security. The political causes of conflict were mainly addressedthrough diplomatic and project peace and human rights efforts.

The Swiss programme introduced geographical cluster areas with the objective to enhancesynergies among the Swiss and Swiss funded projects as a means for developmenteffectiveness. The main instrument to implement the cluster approach has been theformation of a Swiss umbrella for all Swiss and Swiss funded projects; this includes next toenhanced Swiss visibility regular information sharing, assessment of synergy potential and a

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joint assessment of the development context. The cluster approach proved to be verysupportive for development work in a conflict context due to enhanced security through theSwiss visibility as well as the joint local risk and security assessments.

Conflict Sensitive Programme Management (CSPM) was introduced and further developedas a management response to the challenge of working in a fragile conflict context.

The main lessons can be summarized as follows:

- The successful end of armed conflict is a precondition for successful turnaround in fragilestates. This also implies that development actors need to engage actively in conflicttransformation as a precondition for development.

- Staying engaged becomes the main contribution within the transformation process, asdevelopment actors otherwise would not have sufficient influence on transformation andprotection concerns. Whether staying engaged with a development programme, or with amix of humanitarian and development interventions, depends on the respective countrycontext.

- Development actors cannot support conflict transformation on their own. A joint strategybetween diplomatic and development actors is required (‘whole of government’ approach)as well as pro-active engagement within the donor community as a means of donorharmonization.

- Protecting the space for development (or humanitarian work), e.g. focussing on variousstrategies to be able to continue work in conflict affected areas, has proven to be acrucial condition for staying engaged.

- Conflict sensitivity needs to be incorporated both on the development political as well asoperational level. It has to be concrete, operational and context-relevant. Introducingconflict related transversal themes into all sectors and projects is a key approach: thedeeper social causes of conflict were made a transversal theme for all projects, e.g.including not only disadvantaged Nepali groups such as women, lower casts and ethnicgroups, but also marginalized geographical areas, into development activities as well asproject but also cooperation office staff recruitment policies.

- When armed conflict further escalates it is necessary to respond to the deterioratinglivelihood and human security situation.

- Direct support to peacebuilding and human rights is also required both through diplomaticand project initiatives and thus requires close cooperation between SDC and the PoliticalDivisions (PD) within the Swiss Foreign Ministry, especially with the PDIV for humansecurity.

- Adapting a country programme to a situation of armed conflict is a managementchallenge. The report therefore includes a number of lessons and suggests strategiesand practical instruments for programme management in fragile, as well as in conflict,contexts. The report also analyses the comparative advantages of Switzerland inresponse to fragile conflict contexts and presents a number of recommendations.

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1 Introduction

1.1 BackgroundThe Swiss Development Cooperation (SDC) in Nepal adapted its country programme to thesituation of armed conflict. The main adaptations of the programme were implementedbetween the years 2003 - 2005. After many efforts and achievements both on the political aswell as the operational side of the programme, the ‘Conflict Sensitive ProgrammeManagement’ (CSPM) and a Joint Swiss Strategy for Nepal combining Swiss developmentwith diplomatic peace and human rights strategies were developed. In order to learn lessonsfor future work in Nepal, as well as for development work in other fragile conflict contexts, aproject was started to document and analyse the CSPM experiences in Nepal. This reportpresents the project results.

The experiences of the Swiss Nepal Programme should also be understood in the context ofdifferent international debates, namely on armed conflict and development and also on aideffectiveness in fragile states.

Since the 1994 Rwanda crisis there has been a debate about the nexus between aid, armedconflict and peacebuilding. When the book “Do no harm - How aid can affect peace or war”was published (Andersson 1999), it become obvious that development is not only affected byarmed conflict but can also have positive and negative effects on armed conflict.

Meanwhile almost all donors and larger agencies have a strategy for peacebuilding orconflict sensitive development based mostly on the OECD guidelines for conflict, peace, anddevelopment (OECD 2001). ‘Conflict or Peacebuilding’ units like COPRET in SDC have beenestablished in support of geographical units, field offices and partners in conflict affectedcountries. Many of these specialised units have developed approaches and tools forintegrating the conflict lens into their organisations project planning and implementationprocedures (see for example the SDC/COPRET’s CSPM folder).

At the same time the donor community has been engaged in a debate about aideffectiveness in fragile contexts. The Paris declaration on aid effectiveness in fragilecountries (Paris High-Level Forum 2005: 7) made it clear that ‘staying engaged’ is anecessary requirement for development actors.

What has been missing thus far in the two debates is a systematic documentation andanalysis of experiences of how an entire country programme has been adapted to thechallenge of armed conflict as a means of making ‘staying engaged’ an operational andconcrete option.

This project therefore contributes to these debates in analysing the Swiss Nepal Programmeand presenting lessons for the work of SDC and other donors and agencies in developmentenvironments of political tensions or armed conflict oftentimes accompanied by state fragility.

Nepal is an excellent case to further the study of these debates because:• Armed conflict in Nepal that began in 1996, has put all development programmes

under tremendous challenges both operationally and politically;

• Nepal has been a priority country for the Swiss Development Cooperation for almost50 years;

• To adapt the programme to the situation of armed conflict and to supportpeacebuilding and human rights at the same time, SDC Nepal Cooperation Office(COOF) has developed new, innovative approaches, strategies and tools as well asadapted existing ones. This has led to a further conceptualisation of SDC’s CSPMthat takes the management component strongly into consideration;

• The Nepal programme is a good example of how to achieve a ‘whole of government’approach as it has been developed from a traditional SDC development programme

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into a joint Swiss country programme linking development, human rights andpeacebuilding work in a comprehensive way;

• The SDC COOF has made a tremendous effort to document its experiences as ameans of knowledge management in different sectors and themes;

• Nepal is also a pilot country for donor work in fragile contexts.

1.2 Objective and purposesThe objective of this project has been to support SDC in their CSPM efforts and to learn fromthe Nepal experiences. The purposes of the project have been

- to document how SDC Nepal managed the challenge of armed conflict and adaptedthe programme accordingly;

- to analyse the practise and lessons learned of programme management in conflictsituations, to draw lessons and derive a good practise;

- to feed in insights and lessons learned into learning processes that the SDC Nepalprogramme has envisaged for 2005 and 2006;

- to organise and facilitate a learning team at the headquarters with the relevantstakeholders involving the geographical units (E, H), the multilateral plus the F-sections (COPRET, KM) of SDC as well as the Political Divisions II and IV;

- to compare the SDC Nepal experience with SDC experiences in other conflictaffected countries based on short interviews and the participation of the relevantcountry desks in the learning team when appropriate.

The objective of this report is to present the results of the programme adaptation processand to generate lessons for other country programmes in fragile countries prior, during or inthe aftermath of armed conflict. The focus of the report is therefore not to assess the SDCNepal work in and on conflict as this has already been subject to an earlier process (seeCSPM mission report summary in annex 2).

1.3 Research Methodology and ProcessThe project made use of an applied participatory, utilization focussed research methodology:a number of research/learning issues were defined based on knowledge from theinternational debates. These have been jointly adapted to the SDC context with the involvedstakeholders at headquarters. For each learning issue (see annex 1) a number of researchhypotheses were developed and data studied and analysed accordingly.

Data collection took place on the basis of a knowledge management documentation startedby COOF in Nepal in 2003 (Collection of all relevant documents and email communicationssaved in a structured way on four CD Roms per annum) accompanied by interviews in Berne(Asia section, COPRET, knowledge management, DP II, DP IV) and discussions with alearning team established at headquarters for this project. Furthermore in-country datacollection in Nepal took place during a mission in spring 2006.

The in-country mission (see executive summary of mission report in annex 2) had differentcomponents: first, data collection had been carried out on the basis of participation indifferent SDC events (COOF team meeting; 3 day cluster workshop in Charikot, meetings ofSDC projects with partners), participation in different donor meetings, short field visits,interviews and group discussion with COOF management, COOF programme officers,admin, security staff as well as drivers, project managers and field staff, governmentagencies, local implementing NGOs in the field, beneficiaries. Second, an assessment of theSDC conflict sensitive programme management (CSPM) took place. Third, a more detailed

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‘Peace and conflict assessment’ of one development project (TBSSP) had also beenconducted (see summary of report in annex 3).

The results of the first data analysis (CD Roms) were presented and discussed with thelearning team at headquarters; the results of the field mission had been discussed with theCOOF management as well as presented and further discussed during a facilitated workshopat SDC in Nepal with all COOF programme officers and SDC funded projects. Furthermore,general reflections about development work in Nepal were shared with the donor communityin Kathmandu. The mission report was also subject to various comments from SDC COOF,Asia division and COPRET (SDC’s conflict unit), as well as Helvetas (SDC’s mainimplementing partner in Nepal).

As an applied research project preliminary results of the project have already been sharedwith other SDC geographical sections when requested, and a feedback/learning process hasbeen initiated mainly through COPRET.

1.4 Structure of reportChapter 2 provides an overview of the international debates about development in fragileconflict contexts and also describes the way these issues are addressed by SDC. Chapter 3presents background information of the development context in Nepal. Chapter 4 is the mainpart of the report focussing on the adaptation of the Nepal programme to the situation ofarmed conflict: Section 4.1 gives an overview of the SDC programme prior to the adaptation,section 4.2 introduces the context and briefly summarizes the process of programmeadaptation, while section 4.3 describes the main strategies, approaches and instruments ofthe programme adaptation. Interesting examples of instruments are additionally highlightedin boxes throughout this chapter. Chapter 5 draws lessons for SDC and other donor’s work insimilar situations. Finally, chapter 6 gives brief general recommendations for SDC and otherdonors/agencies.

2. Understanding development work in fragile, conflictcountries

2.1 The international debates

2.1.1 Conflict sensitivity in International CooperationToday the issue of ‘peace and conflict’ has entered successfully the mainstream agenda ofdevelopment donors and agencies. The ‘peace and conflict’ lens is a new cross cuttingtheme alongside of gender, governance or environment. It is also widely accepted within thefield of humanitarian action. Most donor and larger development agencies nowadays haveeither a unit or an advisor for conflict and peace (like COPRET in SDC). Almost allorganizations have a strategy for peacebuilding or conflict sensitive development, largelybased on the OECD guidelines for conflict, peace and development (OECD 2001).

Based on research conducted in the aftermath of Rwanda (Uvin 1998), and in other conflictaffected countries (Anderson 1999), it became clear that aid can harm and inadvertentlynegatively affect conflict situations. The main negative effects stem from aid resourcetransfer (Anderson 1999), which can strengthen some actors in the conflict, which mightenhance inter-groups conflict as it happened in Somalia, or the distribution of aid fostersregional imbalances like the case in Mozambique when more aid was distributed to the moreeasily accessible southern region. The same happened in the aftermath of the Tsunami seaquake in Sri Lanka during 2005, when more aid was delivered to the government controlledsouthern area of the island, because aid delivery proved to be more difficult in the LTTEcontrolled north and east of the country. This fuelled existing tensions and resulted in anincrease in violence. Other negative consequences of aid are found in substitution effects, for

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example when governments invest their own resources into the war knowing thatinternational agencies take care of the humanitarian needs of the population - demonstratedduring the Ethiopian/Eritrean war.

As a result of these studies we saw different debates prevailing/arise: The debate about theprevention of another situation, such as in Rwanda, from happening was the beginning of aninterest in political early warning (Carnegie Commission 1997). This topic has since beenabsorbed into the general debate about prevention culminating in the UN SecretaryGeneral’s report on ‘Preventing Armed Conflict’ (UN 2001).

Another debate looked more closely into the consequences of armed conflict, especially withregard to security aspects such as disarmament, demobilisation or reintegration of ex-combatants, and the issue of landmines. This debate has been absorbed into the discourseabout human security (UNDP Human Development Report 1994).

A further discourse focussed on the development of methods and tools to encourageconsideration of the conflict context of development. Experts agreed on three responseoptions for development actors in situations of armed conflict (Goodhand 2001):

§ Working around conflict: Conflict is seen as a negative risk factor that should beavoided;

§ Working in conflict: Actors are aware that development can influence conflict and tryto avoid negatively affecting the conflict situation (Do No Harm);

§ Working on conflict: Actors are also aware that all cooperation work can contribute topeacebuilding.

As a result we find a variety of approaches and tools for working in and on conflict: Analyticalmethods from conflict studies were quickly transformed into a user-friendly set of tools(Fisher et al. 2000). Mary B. Anderson and her team developed the ‘Local Capacities forPeace Approach’ (better known as ‘Do No Harm’) with a planning matrix and checklists forassessing the potential effects of aid projects on conflict and peace. In the same vein, LucReychler and his colleagues started developing ‘Conflict Impact Assessment Systems’focusing on macro-level policy from 1996 onwards (Reychler 1999), while Kenneth Bushdeveloped a ‘Peace and Conflict Impact Assessment’ (PCIA) methodology comparable toenvironmental or gender impact assessments. Large international NGOs and a number ofdonor agencies have adapted the ‘Do No Harm’ approach to fit within their operationalprocedures and applied it in the field in the training of staff and partners (see the COPRETCSPM Manual).

Meanwhile, many organizations use an overall term, ‘conflict-sensitive development’, or asimilar term (de la Haye and Denayer 2003, Paffenholz 2005 and 2006) to describe differentefforts, methods and tools for working in conflict zones with the minimal objective to avoiddoing harm and, if possible, also contribute positively to peacebuilding. The term PCIA, oftenjust PCA (Peace and Conflict Assessment) (BMZ 2005), still prevails but is now used todescribe assessment procedures, while conflict sensitivity, as such, is broader and used asan overarching term.

Next to the debate about conflict-sensitive development many donors and agencies also fundor implement direct peacebuilding projects, e.g. working on conflict not through developmentprojects but through specialised projects with peace or human rights objectives.

The involvement of development in countries with political tensions and armed conflict hasalso supported a more political understanding of development. This has also led to the needfor closer cooperation between political, diplomatic and development actors of donorcountries. This has not always been easy as different interests are involved. However, wecan see more and more countries that develop coherent national strategies (‘whole ofgovernment approach’). The need to be more political has also created the need to haveadequate staff available who are qualified to take over these new tasks. This is a major

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challenge as diplomatic and development careers to date have been mainly separated fromeach other.

Policy measures can be extremely effective, especially when they are applied in a coherentinternational way. There are, however, a number of challenges: donors often shy away fromtough political decisions as they do not want to challenge their diplomatic relations to apartner government. However, this partner may become a conflict party, which can lead toincoherence between peacebuilding, development and diplomatic interests.

These dilemmas have been intensified with the war on terrorism which polarizes internationalrelations. Most armed groups that oppose governments are now perceived as ‘terrorists,’which makes coherent international responses as well as dialogue solutions to armedconflicts more difficult. The war on terrorism has also supported more military solutions toarmed conflicts as many governments now receive military aid for their fight againstterrorism. Moreover, the issue of good governance in development becomes less relevantwhen governments are supporting the war on terrorism. This change has diverted thediscourse back to the time of the Cold War when corrupt authoritarian governments receivedsupport for their affiliation with the ‘right’ system block.

2.1.2 The Fragile States DebateFor a number of years the development community has been engaged in debate about aideffectiveness. Based on research results (Burnside/Dulles 1997) the donors in the‘Development Assistant Committee’ (DAC) of the ‘Organisation of Economic Cooperation’and Development (OECD) reached the conclusion that aid is only effective when recipientcountries adopt sound policies and nurture effective institutions (Paris High-Level Forum2005). The problem with this finding is how to deal with so called poor performing countries,which are commonly countries in fragile contexts, often at a time during or after armedconflict. It has also been acknowledged in the Paris Declaration on Aid Effectiveness thatspecial attention needs to be given to those countries (Paris High-Level Forum 2005: 7) inthe light that currently almost 50% of all international cooperation countries are fragilecountries.

The answer of the donor community so far is ‘staying engaged’ and finding the best ways ofcontinued aid delivery; people should not be held responsible for the poor performance oftheir leaders. The question is how to stay engaged when partner governments are corruptand inefficient; have become armed parties to the conflict; have weak state institutions or donot control most of their territory?

A recent study, commissioned by the World Bank, dealt with ‘Turnarounds in Fragile States’(Rossner IDA 2006) and was based on results from five case studies (Uganda, Laos.Mozambique, Indonesia, Cambodia). It confirms the donor proposal of ‘staying engaged’,however adding a number of conditions that need to be in place for successful turnarounds.The main finding is that the political climate for reforms needs to be analysed and supportedwherever possible. Important factors for a successful turnaround in fragile states thatconfirms earlier research results from political science and peace research are1:

- the successful ending of armed conflict,

- the involvement of opposition groups into the new political order,

- the geopolitical climate,

- the commitment of the political leaders,

- the balance of power between competing coalitions, and

- the degree of donor leverage.

1 See for example the works of Stedman 1997, 2002; Page Fortna 2004; de Soto and Del Castillo 1994; Linder94; Lemarch 97; Walters 97; Hampson 96.

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2.2 The understanding within SDC

2.2.1 Peacebuilding and Conflict Sensitive Development in SDCThe roots of the peace and conflict topic within SDC are closely linked to the abovementioned international debates. In 2001, the Conflict Prevention and TransformationDivision (COPRET) was established as an additional thematic unit at SDC headquarters.However, prior to 2001, humanitarian aid as well as development cooperation reflected theirwork in conflict areas. COPRET supports geographical units SDC Cooperation Offices(COOF) in the field and partners in the planning and implementing of programmes andprojects in fragile states and in situations of political tensions and armed conflict (conflictsensitive development).

COPRET has developed ‘Peacebuilding Guidelines’ as a strategic orientation(www.sdc.admin.ch\Themes\Peacebuilding), and a number of ‘Peace and Conflict ImpactAssessment’ (PCIA) studies have been commissioned until 2004 to assess the nexusbetween SDC programmes/projects and armed conflict. As a result a practical guide called‘Conflict Sensitive Programme Management’ (CSPM) has been developed that providesprojects with a process and a number of tools (adapted ‘Do No Harm’ approach as well as agender-sensitive psycho-social assessment tool for staff, partners and beneficiaries inconflict affected environments).

The thematic priorities of COPRET are violence prevention, crisis intervention and post-conflict management. Integrating migration aspects into development programmes;capitalising the potential of migration; and fighting the negative aspects are also of greatimportance for COPRET.

COPRET is active member of international debates within the OECD/DAC and holds the co-chair of the donor working group on ‘Conflict Prevention and Development Cooperation’(CPDC). Together with the Political Affairs Division IV (PD IV) of the Swiss Department ofForeign Ministry (DFA), COPRET is engaged in the fragile states and other internationaldebates.

2.2.2 The fragile states debate within SDCThe discussion about fragile states within SDC is conducted in collaboration with the PoliticalDivisions IV and the corresponding geographical units. The understanding of the DFAworking group on fragile states follows mainly the OECD/DAC line of thinking that fragilestates constitute a challenge for development, peace and security and have more difficultiesto reach the Millennium Development Goals (MDG).

Swiss responses also follow the DAC recommendations to apply a ‘whole of governmentapproach’, to harmonize aid and to apply the ‘Do No Harm’ principle and flexible planning.

The Working Group has agreed on the following definition of fragile state: a state or contextis called fragile, if the state does not exercise the monopoly of legitimate power on itsterritory; if important parts of the population don’t consider the state to be the legitimateregulatory framework; if the state deprives important parts of the population from havingaccess to basic services (security, law and order, education, health, infrastructure). In anycase, the state may lack the capacity and / or willingness to fulfil the its duties (security,welfare, legitimacy and rule of law, based upon the normative understanding of the state).Poverty, geopolitical interests, bad governance and a culture of violence could be causes aswell as consequences of the fragility.

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3. Development and armed conflict in Nepal

3.1 The development context of NepalHistorically, the Himalayan Kingdom of Nepal has been an independent state led by royalfamilies for more than 200 years. Until 1950, it remained closed to the outside world. From1796 to 1846, Prithvi Narain Shah and his descendants ruled. They were followed by theRana family of appointed prime ministers. The Ranas were overthrown in 1950, and the royalline of the current king came into power. Elections held in 1959 brought the Nepali Congress(NC) Party into power as the first parliamentary government. NC remained in office for littlemore than a year before the king dismissed the government and banned all political parties.

Under a Constitution promulgated in 1962, the then King established a panchayat (assembly)system. Members of this assembly served only at the king's behest. A coalition of the twomajor political forces in the country - the NC and the United Left Front (comprised of sevencommunist parties) - provided the vanguard for widespread political protests that began in1990. With growing domestic and international pressure, the King announced an end to thepanchayat system and agreed to the restoration of multiparty parliamentary democracy. InNovember 1990, the new democratic constitution was successfully implemented and Nepalbecame a constitutional monarchy. Parliamentary elections were held in 1991, and localelections supporting decentralised system of governance were held a year later.

However, frequent government changes, inter-party conflicts, wide spread corruption, slowimplementation of important political changes (like further decentralisation) and themanifestation of armed conflict shaped the political landscape in the following years. This hasprogressively replaced people’s optimism in the democratic changes of the early 1990s withwidespread scepticism and frustration with the political parties and the situation of armedconflict (see next chapter).

On February 1, 2005, the present King Gyanendra discharged the government and assumedabsolute power. As a result, the political parties aligned with the Maoists in a struggle againstthe King, which culminated in a victory over the King in April 2006, through countrywide,peaceful mass demonstrations: The King gave up absolute power, the parliament wasreinstalled and the army seemed to accept parliament control. The political parties and theMaoists have agreed to set up a constitutional assembly to write a new constitution, whichwill equal a peace agreement. However, the concrete shape of the future Nepali democraticstate has not yet fully been defined, and the Maoists demand immediate inclusion into anygovernment to be formed.

Nepal is a multiethnic society, but the traditional caste system and the privileged position ofHinduism as the state religion led to harsh inequalities that divided the society intoadvantaged and disadvantaged groups (DAGs). Disadvantaged groups such as women,lower casts and ethnic groups had been traditionally politically under-represented and theiraccess to resources, education and political decision making has been extremely limited.

Economically Nepal is one of the poorest countries in Asia. A large part of its population of25 million lives in isolated groups in mountainous regions, where access remains extremelydifficult, and about half the population lives below the poverty line. Around 80% of theactively employed people work in agriculture which accounts for more than 40% of the grossnational product. Development assistance, tourism, and exports of carpets and garmentsplay an important role in the Nepalese economy, especially as a source of foreign currency.For the last ten years the remittances of millions of Nepalese working abroad have beencrucial to achieve poverty reduction (the share of people living under the national poverty linewent from 42 % in 1996 to 31 % in 2003), maintain the external balances and substantiallyincrease the national saving rate.

However, the progress for different groups is extremely uneven. The poverty rate for somedisadvantaged ethnic groups, lower casts and women is almost double than the national

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average. The poorest and hardest hit conflict regions have a poverty incidence almost 20%higher than that of the region surrounding the Capital.

India, the United States, the European countries and increasingly Japan, are the mostimportant political and economic countries for Nepal.

Nepal is currently in a critical period in its history. The armed conflict has claimed more than15,000 lives since 1996. The political developments of April 2006, have given new hope for areturn to multi-party democracy but launching and sustaining an inclusive peace process andaddressing the underlying causes of conflict remain the main challenges for Nepal today.However, Nepal will still be categorized as a fragile state for some time as it fulfils all of thedefined criteria: weak government institutions and policies, high poverty rate (HumanDevelopment Index), low income country (World Development Report), period during or afterarmed conflict.

3.2 Armed conflict in NepalDynamics and strategies of armed conflictArmed conflict has focussed most of the time on the rural areas and had thus tremendouslyaffected development work. Armed conflict in Nepal began in 1996, when the Maoists(Communist Party of Nepal – CPN-M) declared a “People’s War”. The Maoists followedmany of the original guidelines and concepts of the Chinese revolutionary Mao Tse-tung(Mao 1938). The Maoist strategy for revolution has three distinct phases that, of course,mirror the history of the Chinese Civil War. The revolutionaries start as a weak, vulnerable,and desperate group. By the end of the conflict, they have become a strong political andmilitary force. In the first phase, the revolutionaries are building what Lenin called "theorganizational weapon", the political, military, logistics, intelligence, and commandinfrastructure. Phase I is a quiet prelude for the real battle to come. The revolutionaries,according to Mao, should be organizing where the regime is weakest – the rural hinterlands.The proto-guerrillas hid among the rural population - revolutionary fish swimming in the vastsea of the countryside, to use Mao's famous metaphor. The duration of phase I can be verylong. The real action occurs in Phase II, which is a combination of a military and politicalbattle were the war can also be ‘brought to the cities’. During phase III the revolutionariescarry out a final assault against the mortally wounded regime: the final revolutionaryonslaught leading to the establishment of a people’s republic.

The Nepali Maoists further developed these original concepts into their own adaptation called“Prachanda Path”.

During the early phase of armed conflict in Nepal (1996-2001), the Maoists mainly attackedgovernment property such as police posts and administration buildings. Human rightsviolations, including killing many “enemies of the revolution” in rural areas, also occurred.However, the Maoists also tried to “win the people” over to their philosophy. They put forward40 political demands centring around the abolition of the monarchy and the introduction ofpeople's governments as well as socio-political issues focussing on justice. These demandsaim at empowering women, the lower castes and other minorities, and also to counteractcorruption, injustice, social inequality and foreign domination of the country.

In the early years, the Maoists gained significant support throughout the country, and theyestablished “People’s governments” in several districts. Up to 40 % of all combatants andcivilian political supporters were women. During this early phase, the governmentacknowledged the Maoist insurgency as a security problem to be addressed by the police.

Conflict dynamics changed with the Maoists’ withdrawal from the first negotiations inNovember 2001. The government declared a state of emergency for the entire country, andthe king authorized the use of the army to fight the Maoists. Moreover, after 11th September2001, the Maoists were declared terrorists. As part of the international anti-terror campaign,the United States and British government began to support the Nepali government withmilitary aid. The Maoists gained military strength; the government and the army only

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controlled the cities. The Kathmandu Valley had not physically been affected by the armedconflict until 2003, from then on bombings and targeted assassinations started. Serioushuman rights violations undertaken by both the army and the Maoists increased all over thecountry. Human rights organizations reported atrocities concerning mass rape of women andgirls by soldiers and executions without trial. For many years Nepal became the country withthe highest number of disappearances in the world.

Causes of armed conflictThere are mainly two causes of armed conflict: The first root cause of the conflict is of apolitical nature: political pressure for a change from a traditional feudalistic system ofgovernance to a “modern” form of governance. This root cause of conflict has thus farmanifested differently in different phases of conflict: in the early nineties - prior to the armedstruggle - we saw a political movement pressuring for a change from feudalism todemocracy. From 1996 onward we first saw the Maoist armed fight against the feudalistsystem but also against the mainstream political parties that had aligned with the king insearch for a constitutional monarchy. It is important to note that the Maoists had been apolitical party prior to their decision to start a people’s war. Several rounds of negotiationsalso failed during 2001 and 2004. After the ‘Royal Coup’ in February 2005, when the kingdissolved parliament and appointed a government of his own, the parties started protestingagainst the monarchy for a re-instalment of democratic rule. They then aligned with theMaoists in a peaceful struggle through mass demonstrations that forced the King out ofpower in April 2006. These developments have opened the way for new discussions about apeaceful democratic Nepal. The SDC Cooperation Office in Nepal (COOF) refers to thiscause of conflict as the ‘political conflict’. It is a matter of definition whether the existence of aMaoist ideology and thus the readiness to engage in an armed fight is seen as a separateroot cause of conflict or as an exacerbating factor of the political root cause.

The second, however interlinked, cause of armed conflict is social and economic. Injusticeand inequality have led to poverty and discrimination of large parts of the population due to asociety divided by caste, ethnicity, regions, religion and gender. COOF refers to this cause ofconflict as the ‘social conflict’.

In addition, in the Nepali conflict, several aggravating factors can be found such as povertythat makes a society more vulnerable to conflict, especially the degradation of livelihood dueto the conflict situation; high level of polarization of the Nepali society with party affiliationsinfiltrating into almost all sectors of society and the often incoherent policies within theinternational community that limited its response to the Nepali crisis.

3.3 The Maoists and developmentIt is important to understand the Maoist thinking about development. In line with the threestages of people’s war (see previous section) there is conceptually no place for developmentduring any phase of the war. This is confirmed by the fact that the Maoists were scepticaltowards development and only allowed either projects that were showing quick impact for thepopulation in the rural areas or those which were perceived as ‘income generation’ projectsthat were paying money or ‘taxes’ to the Maoists. Moreover, the Nepali Maoists claimed thatdevelopment aid was also partially responsible for fostering inequality in the rural areas bygiving support to the local middle class (‘capitalists’) and not focussing on poor andmarginalized groups.2

In traditional (Chinese) Maoism thinking development can start only after the establishmentof a people’s republic. Development is focussed on a rural development approach largelyneglecting the cities and also international support.

2 This is an empirical fact in deed as the development logic of the 70s and 80s wanted to foster developmentthrough support of the middle level of the rural society that will in due cause create employment for the poor.This result chain has not materialised due to the many landless, poor and marginalized groups that had thus notfully been incorporated into the development process. This fact had only been acknowledged by developmentagencies towards the end of 1990s, in deed fostered by the Maoist ‘s support for these groups.

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Thus the Nepali Maoists find themselves in a conceptual /ideological vacuum as they couldnot adapt the original concepts but also could not develop new ones as this had not beennecessary during the war.

3.4 International ResponsesIn the early years of the armed conflict until 2001, national and international actors inKathmandu mostly ignored the armed conflict in the rural areas of Western Nepal. From2001 onwards - when armed conflict escalated further - the international community began torecognise that there was armed conflict in the country (while the government still spokeabout a ‘security problem’).

At that time a few donors started commissioning conflict analysis studies (DFID and GTZ hadbeen at the forefront of these initiatives) to foster an understanding of the situation and thedevelopment environment. From then on international responses veered in differentdirections.

A number of initiatives were developed for ending the armed conflict. International actorswere mainly split into two groups: The actors supporting military solutions to the conflict,mainly the US and India, which was partially supported by the British Defence Ministry, andthe actors lobbying for a peaceful solution to the conflict through a negotiated settlement (EUcountries, Canada, Norway, Switzerland).

International donors have worked in different donor groups, such as a working group on thepeace process. In October 2003, after the failure of the second round of negotiationsbetween the government of Nepal and the CPN(M), donors formulated 12 Basic OperatingGuidelines declaring their commitment to poverty reduction and impartiality in the armedconflict. This declaration has been the starting point of better operational coordination in theconflict affected areas of the country. For this purpose donors and agencies established apermanent working group (known as BOG group) that has met regularly especially sinceGyanendra’s coup of February 2005.

Staying engaged, besides poor governance and armed conflict, had been the commonunderstanding of all involved actors. Thus development aid had been continued throughoutthe conflict, and the amount of humanitarian aid to Nepal was considerably low throughoutthe years. The reasons for this decision are to be found in the causes and dynamics ofarmed conflict in Nepal and the reaction of the international agencies:

First of all, contrary to conflict situations in other countries like Sri Lanka or Sudan, the Nepaliconflict setting has not been characterized by clear geographical divisions between thearmed groups. Though the Maoists had some strongholds in Western Nepal, during thecourse of the conflict they increasingly controlled all the rural areas while the governmentremained in control of the cities. However, even here the boundaries were unclear due to theMaoist guerrilla war strategy. This has nurtured the perception of donors and agencies thatdevelopment aid through government institutions has been still possible in most districts inNepal, however under difficult circumstances. In reality, however, the government onlycontrolled the Kathmandu valley and partially the district headquarters; thus the governmentand aid agencies only had access to the rural areas when allowed by the Maoists.

Second, many development actors in Nepal had been convinced that development aid isbest suited to address the social root causes of armed conflict in empowering and supportingdisadvantaged groups (DAGs) through a development approach. Humanitarian approacheswere perceived as an inappropriate response to these challenges.

However the question of how to stay engaged and address the political issues had split thedonor community:

The International Financial Institutions (World Bank, Asian Development Bank, IMF) believedthat a macro-economic growth policy through traditional government institutions was bestsuited to overcome poverty and armed conflict. They consequently did not react to the

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government’s poor governance and ineffective development performance3 and ignored for along time the fact that the government could not reach out to most of the country.

On the contrary, most of the bilateral donors saw the solution of the political conflict as aprecondition for sustainable development. The British DFID, the German GTZ, theNorwegians, the Danes, the Canadians and the Swiss have been the most pro-active donorsand agencies in this regard. They tried to come up with common understandings aboutresponses to the conflict.

The consequences of this divide led not only to different development strategies, but alsoreduced donor leverage to jointly influence the situation. The issue about partial conditionalityof aid resources as a means to foster the willingness of the government to negotiate had timeand again been a point of discussion. Only after the Royal Coup did bilateral donors put theirgeneral budget support to the government on hold.

A major issue with regard to a negotiated settlement has always been the question ofexternal mediation. After two negotiation processes with Nepali facilitators had failed(Paffenholz 2004), many international actors put forward the idea of external mediation.However, most of the Nepali actors were not in favour (to date) for this type of stronginternational involvement. The donors therefore tried to support national and local capacitiesfor peace in bringing expertise into the process through local, national and international NGOwork or bilateral initiatives.

When the armed conflict further escalated the deteriorating human rights situation, it becamea unifying factor for the divided international community in Nepal. As a result, many donorssupported the Nepal Human Rights Commission and the national and local human rightsNGOs. In 2005, after intensive debates at the UN Commission for Human Rights in Geneva,fostered to a large extent by the Swiss diplomacy, the largest Human Rights MonitoringMission in the world started operating in Nepal with positive effects on human security andpeacebuilding.

At the operational level of development work the deteriorating security situation in the ruralareas became the starting point for most agencies to reflect about ‘working in conflict’: Staffsecurity had been at risk, and the government could not implement its programmes in mostof the rural areas, thus donors had to rethink their project implementation mechanisms; theMaoists also started demanding fees and stipulations from aid agencies. As a responsemany international NGOs and bilateral government agencies started to introduce securityand risk management procedures to be able to continue work in the field. Many agenciesalso introduced the ‘Do no harm’ approach as a means of conflict sensitivity in developmentprojects. Ensuring pro-poor development and including disadvantaged groups (DAGs) suchas women, Daliths or ethnic groups into all development activities had been the prevailingunderstanding of conflict sensitive development in Nepal, e.g. addressing the socialdimension of the conflict. This understanding had been suitable to both the internationaldiscourse on conflict sensitive development as well as the Maoist demand to include theDAGs. Lead agencies included the German GTZ, DFID, Helvetas, the Dutch SNV and SDC.

While this approach was first practised in the projects in the field, at later stages someagencies also started introducing equality recruitment criteria for their own staff recruitment.All agencies had employed almost exclusively staff from higher casts due to discriminationaccording to educational level of the overwhelming majority of DAGs. Some agencies alsostarted to support development in disadvantaged regions, such as in western areas of Nepaland in the hilly areas. Moreover, most agencies introduced quick delivery mechanisms intotheir development projects in response to Maoist demands as well as the deterioratinghumanitairan situation.

The discussion about alternatives to service delivery by the government also became animportant issue in donor and agency discussions. Most agencies shifted implementation from

3 Only in the Nepal Development Forum in 2004 a critical statement had been issued to the government bybilateral donors.

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government agencies to local NGOs or the UN, or introduced direct implementationmechanisms through local or national funds.

Donors have additionally supported, jointly and bilaterally, many Nepali and international civilsociety peace and human rights initiatives.

The UN played different roles during the years. It had a lead role in donor coordination in theearly 2000s, and later this role was increasingly taken over by bilateral donors. Although theUN has tried to support the peace process from different angles and has a policy for conflictsensitive development, it never managed to develop a comprehensive peacebuildingstrategy including all UN agencies and bi- and multilateral donors. Currently, the UN seemsto have a stronger role in Nepal’s transition from war to peace with the appointment of a UNSecretary General Special Envoy to Nepal at end of August 2006.

4. Adapting the SDC Nepal country programme to thefragile, conflict context

4.1 The Swiss engagement in Nepal prior to the adaptation: 50years of development cooperation

Switzerland has a history of development cooperation in Nepal for almost 50 years; it is apriority country (Schwerpunktland) for the Swiss Development Cooperation (SDC). In 2003,Nepal had been the third-largest recipient of Swiss bilateral development assistance.Traditionally the Swiss Development Cooperation has been engaged in the rural areas ofNepal with a geographical focus on the central hill regions. The programme had been built onthe development sectors of forestry and soil conservation, rural infrastructure (roads andbridges) and vocational training. The main partners have always been government agencies,international and local NGOs that worked primarily with local user committees.

The 2005 external programme evaluation covering the period from 1993 to 2004, came tothe conclusion that SDC’s influence on development in Nepal has been far bigger than theactual spending (3.5% of all development assistance to Nepal). The main influences ondevelopment (not taking conflict related issues into account here) included decentralisedgovernance and community-oriented development approaches. SDC became a ‘trend-setter’for bottom-up development: SDC had been crucial in developing and empoweringcommunity-based organisations (CBOs) and service providers. Many of these groups andassociations became the backbone of development and democratic structures during timesof weak governance and armed conflict in the rural areas.

SDC has participated in the respective donor forums in Nepal and abroad, howeveremphasizing its bilateral programme. This emphasis changed when the armed conflict furtherescalated, and SDC saw a need to find a joint response to the situation. From 2003 onwardsSDC assumed an active role within the donor community next to donors such as DFID,Denmark and Norway.

4.2 Overview of programme adaptation processThis chapter provides an overview of the process of the adaptation of SDC’s programme tothe conflict situation, while the main strategic decisions, strategies and instruments arepresented in the next section.

The SDC country programmes had not paid attention to the conflict situation prior to 2002,when in an addendum to the country strategy 1998-2004, and then in the country programmefrom 2005, the armed conflict was given a central place. However, projects already took intoaccount the conflict situation in their local contexts. They slowly started to apply a conflictaspect to their work and also included human rights issues as transversal themes from 2002onwards. Gender as a transversal issue had already been introduced in 1991; however, aconflict-oriented gender understanding was introduced only in 2002.

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The focus in the armed conflict became necessary as staff and beneficiary security had beenat risk, and the government started to experience difficulties in delivering services to most ofthe rural areas. The introduction of the ‘Do no harm’ approach and security guidelines byHelvetas - SDC’s main partner in implementation - had also influenced SDC’s approach toconflict sensitivity for projects.

At the same time other donors like DFID tried to create awareness within the donorcommunity to find a solution to the Nepali crisis. During the first round of negotiations in2001, the donor working group on the peace process was created. Donors thought to supportcivil society initiatives parallel to the official peace talks. When the negotiations broke down,discussions in the working group continued, however without a clear direction. SDC hadbeen part of this group and also supported a multi-donor trust fund for ‘Peace andDevelopment’.

COPRET conducted a PCIA mission to Nepal in 2003, and held a workshop with the COOFteam. Security training had taken place earlier, and conflict monitoring with the help of MERVand FAST had been introduced. As a result it was suggested to inculcate peacebuildingcomponents into the programme.

The main adaptation process took place in 2004 and 2005, after major events fostered thefurther adaptation of the programme, i.e. the failure of the second round of negotiations inAugust 2003, had led to a deteriorating human security situation negatively affecting thespace for development. The donors formed a new working group (BOG group) resulting in anagreement on joint operating guidelines for conflict affected areas among all donors andagencies (see annex 5). The international donor community started discussing the Nepalicrisis in international meetings; the first meeting of this kind happened in London in 2004.

In 2004, a joint mission between SDC/COPRET and PDIV took place, and COOF decided toadapt projects one at a time to the situation of armed conflict. COOF made use of tools(CSPM) provided by COPRET and built on experiences from Helvetas. As a result a humansecurity approach (looking at staff and beneficiaries) combined with inclusion of DAGs andimprovement of livelihood was introduced. COOF also decided that those projects that wereunsuitable to the conflict situation would be phased out at the end of their project duration.The partnership with Helvetas was enhanced and modalities for work with the governmenttook into account that government agencies had little access to the rural areas.

COOF, jointly with PDIV, lobbied successfully for the human rights issue in Kathmandu andGeneva contributing considerably to the decision to establish an international human rightsmonitoring mission in Nepal.

In spring 2005, a joint SDC/PDIV strategy planning workshop took place resulting in a jointSwiss strategy for Nepal. The armed conflict has been placed at the centre of theprogramme. Moreover, a geographical cluster approach had been introduced and adiplomatic advisor for peacebuilding has been sent to COOF from PD IV in Berne.

To implement all these changes, the internal organisational structure of COOF, as well as itsrelations to the projects, was also reorganised: The Nepali COOF programme officerstogether with the project managers became the central actors in support of the projectadaptation process. Focal points were introduced within COOF to foster understanding,monitoring and learning with regard to specific conflict related issues.4 Moreover, COOF tooka stronger coordination role vis-à-vis the projects, especially through the organisation of“clusters workshops” (see chapter 4.3.2) in selected districts. The adaptation process thathad been faster within the SDC projects took longer within partner projects. As aconsequence new project management requirements were introduced.

The partnership with the development banks was enhanced and the general work with thedonor community intensified.

4 CSPM, equity, gender/women in conflict and governance.

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4.3 Main strategic decisions, approaches and instrument ofprogramme adaptation

Between 2002/03 and 2005, the SDC Nepal country programme underwent the followingmain strategic changes:

4.3.1 Staying engaged with a development programmeStrategic decision and main approachSDC’s Nepal programme had been a traditional development programme when the armedconflict escalated from 2001 onwards (see chapter 4.1). The core strategic decision to adaptthe programme to the conflict situation has been to stay engaged with the developmentprogramme throughout the conflict for as long as possible. This is worth highlighting as this isnot a typical situation: In many armed conflict situations a development programme isreplaced entirely or partially by a humanitarian programme that successively follows theRelief/Rehabilitation/Development (RRD) continuum logic.

Throughout these years SDC’s Nepal programme was never put on hold; however, a numberof project activities had been interrupted or delayed due to security related problems.Besides the fact that long-term development objectives are less important in situations ofarmed conflict, all in all, development outputs could still be achieved to a large extent (minus10-15% of development output pending on project).

The decision to stay engaged with the development programme was not reached by SDC inisolation. All other donors and agencies also tried to stay engaged (see chapter 3.4).Implementation strategies and main instrumentsIn order to be able to stay engaged the programme management tried to protect the spacefor development as much as possible. This was done through a number of strategies andinstruments at different levels:

COOF engaged in a close monitoring of the conflict situation with the help of MERV (see boxno.1 below) and local risk assessments (LRA) (see box no.2). In following the cycle ofMERV, quarterly programme and project planning exercises were introduced as a means toflexibly adapt the programme to the changing situation. The flexibility of the project budgetshas been essential for this endeavour. Part of this strategy has also been the introduction ofrisk and security management for staff. For this purpose the post of a full time security officerwithin COOF was created.5

In addition, COOF also made use of more general political analyses of the situation such asthe reports of the International Crisis Group (ICG), other donor and agency reports and alsochecked the FAST report for comparison with MERV. COOF also commissioned a regularqualitative analysis of the political situation to a local journalist.

In interviews the involved stakeholders at COOF and headquarters gave clear priority toMERV as their main report for practical use. In addition, the local journalist report has beenvery much appreciated by both COFF and headquarters. ICR reports are also alwaysconsidered interesting.

5 The post of security officer had been created with the help of a reorganising within COOF.

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Effective use of MERV for conflict monitoring and flexible programmeadaptationSince June 2003, COOF Nepal has produced a MERV report every 6 to 8 weeks withoutinterruption. The program team (10 - 12 colleagues) meet and collect information in a waystructured by the MERV tables (see the tables attached to the MERVs, annex 6). The latterhave remained the same for three years - although they are certainly not perfect, continuityhas been more important than accuracy. The subjective observations made by thecolleagues are written on cards and discussed by the whole team. Only undisputedinformation is retained and put on the pin board. When all the information is collected, theteam discusses the trends and determines, by consensus, if the situation in the differentareas has improved, has deteriorated or has remained the same over the last two months orso. The trends are then transposed on a graph that tries to capture the changes in tendencyover a longer period of time.

The information collected and the discussions in the team are summarized in a three to fourpages report. The latter always includes five to six operational conclusions /recommendations for the work of SDC and the programme management (the synthesis havebeen written mainly by the coordinator). The draft is then circulated among the teammembers. Their reactions are considered and selectively incorporated in the final version thatis distributed to the programme team, the project leaders as well as all the main responsibleof the Swiss program in Nepal, at SDC, DP II, DP IV, Embassy of Dehli, and in the boards ofthe main International Development Banks.

Analysis and conclusions are verified ex post with similar documents produced by FAST andby other organisations (mainly DFID/GTZ Risk Management Office, OCHA,UNHCHR, International Crisis group). In fact, the preparation of the periodical MERVnourishes the dialogue with the organisations mentioned here as well as the action of SDC inthe BOGs group and in other coordination forums.

COOF supposes that MERVs are read, are considered by SDC management and sustain thetrust of SDC headquarters in COOF work. In three years however, no substantial commentsgoing beyond a generic appreciation have been received - even when other comments andsuggestions made by HQ indicated the existence of possible temporary differences anddisagreement in the assessment of the situation.

Text provided by Jörg Frieden, SDC Nepal COOF coordinator

The defence of the space for development work through the collective promotion anddefence of the ‘Basic Operational Guidelines’ (see annex 5) adopted by ten agencies and, ina slightly different format, by the United Nations Agencies, has also been crucial for ensuringthe continuation of activities in rural areas. SDC plays a crucial role here, holding the chair ofthe BOG group. SDC has also become an advocate for continued development efforts in therural areas. SDC could make use of its presence in the field to link Kathmandu based donorsand agencies with the realities of the conflict affected parts of the country. Through feedinginformation from SDC’s field presence and the regular visits of the country director to thefield, SDC gained high reputation within the donor and agency community in Nepal.

Whenever the human security situation deteriorated, this had negative effects on the spacefor development. The Swiss engagement for human rights and human security (see chapter4.3.5) can therefore also be seen as a strategy to protect the space for development.

Another strategy to protect the space for development had been communication with theconflict parties. SDC stayed in permanent contact with the government and also introducedan innovative development dialogue with the Maoists. SDC could profit here from decades ofexperience in the rural areas with a bottom up development approach. In addition, SDC hastrained project staff how to communicate with the Maoist and how to solve project relatedimplementation problems directly with them. After the Maoist leadership had signed theBOGs, a high level communication was thus introduced between the donors and the Maoists

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via the UN from mid-2005 onwards. This allowed the donor community to report incidentsrelated to the space for development directly to the Maoist leadership who could take action.6

For protecting the strategy to stay engaged, it had been crucial for the Nepal programme tohave adequate home support from Berne. Engagements in difficult contexts are often subjectto critical questions from headquarters or frequently from the public.7 Especially a smalldevelopment agency like SDC has to set priorities constantly and has been also underpressure to reduce the number of countries where Switzerland is engaged. During thisdebate, the Nepal engagement had been questioned a number of times. A propercommunication strategy between the headquarters and field missions to Nepal and differentpeople from the Swiss headquarters, including members of the Directorate, was an importantinstrument for creating awareness for and an understanding of a development programmeunder difficult circumstances.

4.3.2 Introduction of Swiss geographical cluster areas throughout thecountry

Strategic decision and main approachIn 2005, geographical cluster areas were introduced that are coordinated by either SDC orHelvetas. Each of these clusters represents a geographical area in Nepal comprised of anumber of districts where Swiss engagement has been traditionally strong.

The objective of the clusters is to improve synergies among the different SDC and SDCfunded projects; to jointly analyse; and - if possible – to keep the space for development asmuch as possible.Implementation strategies and instrumentsThe main strategies and instruments to implement the cluster approach have been theregular information sharing and assessment of synergy potential and conflict risks for theSwiss projects in the respective clusters or districts. Regular coordination meetings tookplace in district headquarters attended by all Swiss and Swiss funded projects with fieldpresence in the districts, combined with quarterly workshops in each cluster. COOFprogramme officers and representatives from projects with no district field presence alsoparticipate in the cluster workshops. During these workshops synergy potential is analysedand a joint local risk assessment (LRA) is conducted. The LRA allows the analysis of thelocal space for development within the cluster areas and adapts projects accordingly. TheLRA has also created awareness for, and learning from, working in and on conflict.Information gathered in these cluster workshops has been systematically channelled back toCOOF to be used for MERV and within the BOG group.Local Risk Assessment: a tool to analyse the space for development in conflict areasSDC focal districts of Dolakha, Ramechhap and Okhaldhunga undergo LRA every month ata fixed day. The days are different for each district. It is a collective process where all districtbased staff participate. Similarly, LRA of non focal districts such as Sindhupalchok, Kavre,Sindhuli, take place in Kathmandu every two months.

During the LRA meetings, staffs bring up all security related issues (threat, risks) andcollectively make recommendations to resolve the issue or minimise the risks. COOF makescomments or gives inputs on the recommendations but not on the issues as these are theperceptions of the local staff. The LRA gives a good picture of the situation in the districts,especially the situation for staff security.

Additional monthly coordination meetings in our focal districts take place every monthtogether with the LRA. Both events are conducted on the same day. Some staff, dependingon the location of their duty station may have to walk one to three days to attend these

6 In December 2005 Prachanda “recognized” the BOGs and promised publicly to respect them.7 Public criticisms had not happen in the case of the Swiss Nepal programme; however the Danish Nepalprogramme had been subject to heavy public criticism.

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meetings. In this meeting all district based staff participate but also all senior staff fromKathmandu are expected to participate.

During this meeting, information on upcoming project activities is shared amongst all staff.This is also a forum where common activities are discussed and planned. Different projectstake advantages from each other’s experience/know how as a means to enhance synergiesand thus development and security effectiveness.

Text provided by Tshewang Ngudup, Senior Security Manager SDC COOF Kathmandu

Moreover, within the clusters working groups on different themes relevant for the respectivegeographical area have been established with the objective to find joint solutions forproblems. The presence of SDC in the clusters had also been used to disseminate the BOGsin the districts.

The creation of a Swiss umbrella has been an important instrument to increase the space fordevelopment of the Swiss projects. While SDC as well as Helvetas have always tried to below profile actors in the field, the conflict situation has made an increase in visibilitynecessary as the Swiss logo proves to be a means of protection in the field. Switzerland ishighly recognised by all conflict parties and sometimes gets confused with the logo of theRed Cross, which additionally facilitates access and acceptance. As a consequence SDChas introduced a joint umbrella for all Swiss and Swiss funded projects. As a side effect theumbrella has created more identity and responsibilities among SDC funded projects. TheSwiss umbrella also facilitates a joint representation of Swiss projects vis-à-vis the conflictparties.The Swiss umbrella as a tool for operating in conflict situationsDevelopment workers active for SDC and its implementing partners have enjoyed asupplement of security when operating in conflict affected areas: this immaterialreality has been called “the Swiss umbrella” and had been established by thefollowing steps:- a strict application of the basic operating guidelines, which has ensured the povertyfocus and the impartiality of the projects supported by SDC;- constant communication with the district authorities about development activitiessupported by SDC in rural areas;- direct dialogue on development related matters between SDC / Coofrepresentatives and district political cadres of the CPN(M);- full transparency of projects planning, activities, budget and expenditures financesby SDC – often through public hearings and public auditing;- a large identity card with SDC Logo, carried around the neck by all authorised stafftravelling in rural areas.Text provided by Jörg Frieden, SDC Nepal COOF coordinator

4.3.3 Engagement in donor coordination/harmonizationStrategic decision and main approachBased on the assumption that donors can achieve more impact on protecting the space fordevelopment and supporting peace, human rights and democracy in the country while itrebuilds, SDC fostered their coordination with and among other donors.

There were various obstacles towards joint donor responses: First, not all developmentdonors shared the same analysis of how to respond to the dynamics and consequences ofarmed conflict in Nepal (see chapter 3.4). As a consequence, different response strategieswere implemented resulting in a divide between bilateral donors and the Washington basedFinancial Institutions (World Bank, IMF); the Asian Development Bank (ADB) assumed amedian position with good understanding and collaboration with the bilateral agencies.

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SDC tried to find bridges between the two donor groups through a) the work in the BOGgroup, b) ongoing advocacy for joint donor responses, c) implementation of joint projects withthe development banks as a means to facilitate their understanding of the situation throughdevelopment dialogue, and d) interventions on the Board level of the Banks in Washingtonand Manila (see next box below).

Another effort of harmonizing donor positions had been SDC’s work on scenario building witha group of like-minded donors. The objective had been to discuss different future scenarios(that had been developed by an international NGO) as a means of preparedness for andresponses to a potential new situation. Scenarios were been used for bilateral programmeplanning.

The combined Swiss efforts in Nepal and Switzerland, vis-à-vis the UN Human RightsCommission in Geneva, have contributed substantially to the establishment of the largestexisting Human Rights Monitoring Mission. SDC support of the national Human RightsCommission, as well as different national and local human rights NGOs, was an importantpart of this strategy.Implementation strategy and instrumentsSDC made use of advocacy and agenda setting in the different donor forums in Nepal andinternationally. This was possible as Switzerland, a small and neutral country, had beenengaged in Nepal for decades and had a positive reputation. Additional recognition amongdonors in Nepal stems from SDC’s field presence, the regular visits of the country director tothe field, and the active political engagement of Switzerland in different areas such as humanrights, peace and development.

SDC made also strategic use of its knowledge of the local situation, e.g. its presence on theground, for feedback into the different donor forums in Nepal and abroad. Switzerland couldprofit here from being an operational and a political actor.

The implementation through the ‘whole of government ‘ approach with an interplay betweenSDC, PDIV and the Swiss representatives at the World Bank also made this effort possible.

The Swiss intervention at the World bank Board in Washington: the unheard plea for acoherent strategy for reform and development in a country affected by armed conflictAn executive director represents Switzerland (and other countries) at the Board of the WorldBank. During the last years this director – who knows well the Nepali situation – has receivedregularly the assessments of the development environment written by C00F (Merv reports).COOF provided a critical analysis of the World Bank’s Country Assistance Strategy that hadbeen presented to the World Bank Board in October 2003 (which largely ignored the realityof the conflict) and provided the Swiss office in Washington with updated assessment of theBank operations in Nepal. This allowed the Swiss Executive Director in the World BankBoard to engage in a dialogue with the Bank management in Washington as well as with theBank’s Country Director in Nepal. It is impossible to say how much these exchanges haveinfluenced the Bank’s attitude toward development and conflict in Nepal. The Bank remainingfundamentally agnostic toward the political conflict and continuously stressed that it is a nonpolitical body and that it is possible to pursue development objectives in this country withouttaking explicitly into account the reality of the political confrontations.

Text provided by Jörg Frieden, SDC Nepal COOF coordinator

4.3.4 Introduction of a Joint Swiss ProgrammeStrategic decision and main approachAs a means to make effective use of all foreign policy instruments the OECD DACrecommends applying a ‘whole government’ approach. In response to this recommendationthe traditional SDC development programme has been changed into a joint SwissProgramme. In the case of Nepal this ‘whole government’- approach is currently centred onSDC and PDIV combining development, human rights and peacebuilding strategies in acomprehensive way. This is an approach also practised in other Swiss country programmes.

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In non-conflict countries often SDC and SECO (see Swiss country programme for India orMozambique) join hands, whereas in conflict countries SDC and PDIV are the main partners.

The joint Swiss strategy contributes to development effectiveness because donorharmonization is not possible when the single donors do not have an effective strategyoriented towards the central goals of development in the respective country. In the case ofNepal, the end of armed conflict is a crucial condition for development. The joint strategytakes this into consideration in making use of all different kinds of development anddiplomatic policy and operational strategies at hand. For example a peacebuilding andhuman rights component had been added to the development programme, or the SwissExecutive Director at the World Bank Board was made part of such a joint strategy.

The Swiss peacebuilding engagement profits from Swiss reputation and networks fromalmost half a century of development engagement in Nepal. The development cooperation,on the other hand, profits from the political peacebuilding engagement as SDC, by itself,could not have addressed the political conflict at the diplomatic level.8

Implementation strategy and instrumentsTo develop the joint strategy all relevant Swiss actors from headquarters were invited to astrategy building workshop in Kathmandu in spring 2004. The involvement of all of theseactors was a crucial instrument for the development and the implementation of the jointstrategy.

Important instruments for implementing the joint strategy had been first of all the analysis ofall foreign and development policy options for supporting the programmes objectives. Thenomination of a special advisor for peacebuilding with diplomatic tasks, the recruitment of ahuman rights officer within COOF9 as well as intensive cooperation between COOF andBerne (SDC Asia desk, PDIV, DPII, COPRET, IFIS) as well as enhanced cooperation withinBerne were instrumental. For this purpose a special steering committee (Steuerungsgruppe)had been established in Berne comprised out of SDC (E and COPRET), DPII and PDIV.

4.3.5 From government to people-centred PRSP focussing on livelihood,inclusion and human security

Strategic decision and main approachesThe focus of the programme has shifted from a project approach, oriented towards thedifferent SDC development sectors (see evaluation from 2005), to a comprehensiveprogramme approach orienting all different interventions towards the programme objectivesin support of PRSP.

However, due to the fragile situation of the state (e.g. its weak institutions and policyimplementation mechanism), PRSP became more of a reference for development strategiesrather than a strategic and operational framework. The government in a fragile state couldnot be the central actor for development because it could not perform its envisaged PRSPcoordination function. Due to the conflict situation the transformation of the armed conflicthas been put at the core of the programme objectives.

In consequence, the following changes in programme orientation were made:

1. The programme changed its focus from a government-oriented developmentapproach to a people-centred development approach. Work with the government hadbeen continued where possible, for example in support of a national trail bridge sub-sector strategy with the Ministry of Roads and Infrastructure. However, in the ruralareas, most of the development implementation had been channelled through localuser committees. As interlocutors SDC uses local NGOs, partially still districtgovernment structures (where possible) or social mobilisers employed by the

8 Track 1 is the official peace process with the main conflicting parties; track 1.5 is support work with actorsclose to the official parties and track 2 initiatives are mainly to be found within the civil society.9 The human rights officer had already been recruited in 2003.

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projects. Here SDC could build on its tradition of community-oriented development inNepal (see chapter 4.1).

2. In order to address the social root causes of conflict inclusion of disadvantagedgroups (DAGs) and (to a lesser extent) neglected geographical areas into all projectactivities the following were started in 2002:o First the composition of user groups and beneficiaries were assessed and the

participation of DAGs enhanced;o Some existing and new projects have shifted their entire focus towards DAGs

as the principle beneficiaries;o At a later stage new staff recruitment for COOF and the projects was subject

to an inclusiveness strategy in giving priority to the recruitment of DAGs10;o Some projects also enlarged their outreach to geographical disadvantaged

areas or regions.

3. The programme also changed in order to competently address the consequences ofarmed conflict with a focus on human security. This approach included the followingelements:

o As a result of armed conflict, the livelihood of a large part of the populationdeteriorated. Hence, long-term development goals lost relevance and short-term needs increased. Instead of introducing a relief programme, SDC andother agencies decided to integrate quick impact measures for the livelihoodof people into their existing development projects. For example, the roads andbridge projects (DRSP; TBSSP) could still achieve their development outputs(e.g. building roads and bridges that will have a mid- to long-term, effect onpoverty reduction) while at the same time including community based workprogrammes during construction. These programmes ensured an immediateeffect on the basic livelihood of the involved communities through increasingcommunity work and decreasing as much as possible work of contractors andoutsiders. At the same time, however, institution building and training relatedactivities received less attention and resources.

o Also as a result of armed conflict, development stakeholders (local project orNGO staff as well as their beneficiaries) started to suffer from psycho-socialsymptoms. COOF developed together with COPRET and the gender section atool to address the socio-psychological dimension of working in armed conflictsituations, taking into account more comprehensively the effects of fear andtrauma in the behaviour and expectations of the beneficiaries.

o To respond to the deteriorating human security SDC and PDIV supportedlocal, national and international human rights initiatives; also for this purpose alocal protection approach was introduced in the projects. Instead of leavingdevelopment dialogue with the Maoists (and the involved threats) tocommunities, COOF declared this as a management responsability of SDC atthe different levels of the organisation: SDC cadres started talking to CPN(M)district leaders about development space and the respect of the BasicOperating Guidelines; project cadres discussed with the CPN(M) objectives,organisation and resources available to the projects; local staff explained itsmandate and the concrete work performance at the local level. This was afundamentally different approach to standard practice in local developmentwork in Nepal. All projects in the rural areas had to deal in one way or anotherwith the Maoists as a precondition to work. Development organisations usuallyleft this task to their local staff who then directed these negotiations to theinvolved communities with the justification that the communities know the local

10 The recruitment of DAGs is difficult due to the disadvantage in education in decades. COOF therefore takesan approach of staff empowerment and capacity building.

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Maoists. The fact that communities had often been under threat from bothconflict parties had thereby largely been ignored.

Implementation strategy and instrumentsAn important instrument had been to adapt all development projects along the ‘key moments’(moment fort) of the project cycle (phase planning, external reviews, formulation of theannual program, evaluations, etc.) to the situation of armed conflict. All projects had toidentify their specific way of addressing livelihood, inclusion and human security, as well asthe way they were dealing with the expectations and the demands of the parties to theconflict.

In support of this process, COOF gave responsibility to the local COOF programme officersand at a later stage to project managers. While COPRET, but also Helvetas, had initiallyprovided some tools, and COOF had organised a few training events (security management,negotiation skills, stress management) the main means of local staff empowerment was ajoint ‘learning by doing’- approach:

- Management responsibilities have been systematically shifted away from expatriateto national staff.

- Focal groups were formed within COOF to address different themes; the programmeofficers were given more responsibility; and as a result, COOF further developedexisting and new instruments and became a rich learning resource for COPRET.During this process a tool kit for addressing psycho-social consequences of armedconflict in a gender sensitive way had been jointly developed, and the CSPMrequirements and procedures were further implemented (see CSPM mission report).

- Joint learning events were organised by COOF as exchange forums for COOF staffand partners; these events were mainly held among COOF staff. The joint discussionof an assessment of SDC’s CSPM work in spring 2006, with COOF and project staffhas been part of this learning endeavour.

- Part of the reorganisation process within COOF and the projects had also been theintroduction of a conflict-sensitive staff recruitment policy, e.g. the systematicintegration of DAGs into the teams as a requirement for new staff recruitment.

- The contact with the partner organisation changed due to the new context. Thecooperation with strategic partners, such as Helvetas, intensified, but also SDC’scoordination function increased in general and within the SDC clusters.

- Security management for staff was introduced through the establishment of a full timesecurity officer.

4.3.6 Special programme component for human rights andpeacebuilding

Strategic decision and main approachesWithin the Swiss programme human rights and peacebuilding was introduced in three ways:

1. Conflict transformation has become the central focus of the entire Swiss Programmefor Nepal since 2005;

2. All development projects try to contribute to human rights and peacebuilding asdescribed in the previous section;

3. A separate programme component ‘Meaningful dialogue and conflict transformation’has been introduced as the third pillar of the joint Swiss strategy for Nepal.

The following chapter addresses this separate component. The objectives of this componentare:- to create enabling environments for the peace process in supporting national and

international facilitation initiatives: in this case Switzerland is engaged in direct

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facilitation in support of the conflict parties with expertise such as negotiation orconstitutional processes;

- to ensure that achievements in the human rights sector will be maintained andintegrated in the transformation process from war to peace;

- to link these initiatives with local activities in order to transform the social conflict.

Implementation strategy and instrumentsThe main instrument to implement this component has been the appointment of a specialadvisor for peacebuilding by PDIV operating in Nepal as well as in Berne and internationally.In addition a human rights advisor was sent by SDC to COOF in Nepal in 2003, follows thenational human rights initiatives and projects.

The decision to establish a separate peacebuilding component to the exiting SDCprogramme was a result of a joint SDC/PDIV mission to Nepal from headquarters in spring2004. The mission concluded that Switzerland can play an important role within the Nepalipeace process in addition to the conflict transformation, human rights and gender lens astransversal issues within the exiting development programme. The special advisor forpeacebuilding started work in May 2005, and focused on the following activity lines:

- Negotiation process: Prior to the system change before spring 2006, thepeacebuilding advisor has been active in trying to create an enabling environment forpotential peace talks. Since spring 2006 and the start of the negotiations between thenew government and the Maoists, the peacebuilding advisor has supported theconflict parties with needed expertise.

- Transition phase: Switzerland has supported different initiatives around immediatepost-conflict needs such as the constitutional process or international and nationaldebates about disarmament and demobilisation.

- Human rights and transitional justice: Switzerland has been a crucial actor in supportof the UN Human Rights Commission’s decision of April 2005, to send a human rightsmonitoring mission to Nepal. Switzerland continues its support to human rights and arights-based approach to mediation and justice in Nepal with workshops andseminars as well as political measures.

- Monitoring of the ceasefire: Switzerland is ready to support such a monitoringprocess; it has, however, not yet fully started. Switzerland is also keen to support theparticipation of women in the peace and post-conflict peacebuilding process. Heredifferent initiatives are supported.

5. Lessons Learned

5.1 Lessons for why and how to ‘stay engaged’The experiences of the Swiss Nepal programme first of all demonstrate that ‘stayingengaged’ with a development programme in difficult contexts is not only possible but amutual condition for conflict transformation. The following lessons can be derived from theNepal experience:

1. Lessons from the Nepal experiences thereby confirm the findings of the IDS study‘Successful turnarounds in fragile states’ commissioned by the World Bank (IDS2006, see chapter 2.1.2) that the successful ending of armed conflict is a preconditionfor successful turnaround in fragile states.

2. This also implies that development actors need to actively engage in conflicttransformation as a precondition for development. Whereas development actors haveseen their role in conflict transformation in the past more as addressing long-termcauses of conflict through development projects (like inequalities and exclusion), theNepal lessons shows that bilateral and joint donor responses addressing political

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questions and dealing with political actors are crucial for contributing to thetransformation and end of armed conflict.

3. Staying engaged becomes the main contribution within the transformation process asotherwise development actors would not have sufficient influence on transformationand protection concerns. Whether staying engaged with a development programme,or with a mix of humanitarian and development interventions, depends on therespective development context. The Nepali experience shows that developmentprogrammes can be adapted not only to fragile contexts but also to situations ofarmed conflict in an effective way.

4. Development actors cannot support conflict transformation on their own. A jointstrategy between diplomatic and development actors is required (whole governmentapproach): The geo-strategic climate needs to be manipulated, and national andinternational mediation, facilitation, human rights or other political reform initiativesneed to be supported. Therefore, the joint engagement of SDC and PDIV has beencrucial. The parties involved also learned that the support of these processes needsadditional time as well as expertise. The establishment of a special advisor post forpeacebuilding has been a necessary precondition to implement the joint strategy.

5. Donor harmonization is essential: The lessons from the Nepal experiencedemonstrate that conflict situations create an opportunity for donors to come closertogether as the need to respond to common threats and challenges is bigger than in‘normal’ development contexts. On the other hand, in conflict situation single donorscan be dominated by their national political interest. The challenge therefore is to usethe opportunity for enhanced coordination/harmonization and bridge potential politicaldivides at the same time.

A common understanding of the situation and especially joint response strategies to thedemands of the political actors by involved donors and international actors are anecessary condition for an effective use of donor leverage in support for conflicttransformation and development effectiveness. This also confirms findings of the IDSstudy. It is therefore necessary to lobby and act for donor harmonization as a means tofind a joint understanding of the political development context. Even if the divide betweensome of the development banks and the bilateral donors as well as the political dividewith regard to the war on terrorism could not be fully bridged in the case of Nepal, SDC’sadvocacy within the donor community and vis-à-vis the development banks had been animportant contribution.

6. Protecting the space for development especially in the rural areas as long as possiblehas proven to be a crucial condition for staying engaged. The presence of SDC andpartners in the field has had positive effects on protection of the population in therural areas. This also enabled SDC to transfer local information to the national andinternational level and to engage in local and district dialogue with the Maoists. Thespace for development has been additionally protected through support to local,national and international human rights initiatives as well as the implementation of the‘Basic Operating Guidelines’ agreed by the majority of donors and agencies and lateralso by the Maoists.

7. Development programmes need to adapt their strategic focus strongly to thedevelopment context. The amount of focus shift thereby depends on the degree ofstate fragility and the level of armed conflict. The programme objectives have been inline with a convincing Poverty Reduction Strategy. However, the weak governmentpolicies and institutions, exacerbated by the armed conflict and the inability of thegovernment to reach out to the rural areas, made it necessary to change the focus ofthe programme. Working mainly through the government had to be replaced by amore bottom-up people centred development approach. The main interlocutors withcommunities and user committees have been international and local NGOs or projectsocial mobilisers. Contrary to many other donors and agencies, SDC could build on

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their rich experiences with community-oriented development as well as on thedecades of experience of their main partner Helvetas.

8. It is an important lesson from the Nepal experience that conflict sensitivity needs tobe concrete, operational and context-relevant. Introducing conflict related transversalthemes into all projects is a key approach: the social root causes of conflict had beenmade a transversal theme for all projects, e.g. including not only disadvantagedNepali groups such as women, lower casts and ethnic groups, but also marginalizedgeographical areas, into development activities.

9. Mainstreaming conflict into development is more sustainable as a people-centredlearning experience rather than a tool-based training approach: COOF has put thelocal programme officers and project staff at the heart of this process instead of givingtool-based training to expatriate COOF and project staff (as applied by many otheragencies). In addition the respective local staff also received some training; howevermost of their experience was gained in guided learning by doing process.

10. When armed conflict further escalated it became necessary to respond to thedeteriorating livelihood and human security situation. It is an important lesson that theconsequences of armed conflict to a large extent could also be addressed bydevelopment programmes without introducing humanitarian action: In the case ofNepal this had been done through either adding quick impact activities todevelopment project designs and implementation or starting new projects with astronger focus on livelihood. Human security was addressed through a) risk andsecurity management, b) supporting human rights initiatives, c) engaging intodialogue with all conflict parties, d) introducing psychosocial approaches for projectstaff and beneficiaries.

11. Direct support to peacebuilding is also required both through diplomatic and projectinitiatives for peace and human. However, the interplay between political and projectinterventions is important. Consequently the relevance of specialized projects in thelight of a coherent joint strategy needs to be assessed prior to support. In the case ofNepal there had been a lot of donor support to various international and nationalpeace and human rights projects, mainly through NGOs. How much the impact ofthese organizations on the transformation of armed conflict around the events in April2006 has been, is difficult to assess. Looking at the outcomes, it seems that thesupport for different human rights initiatives has been important especially becausehere local, national and international initiatives have been linked.

12. Adapting a country programme to a situation of armed conflict is a managementchallenge. Management has to be flexible, open for changes, and have a goodknowledge of the development political context. They also need to have thewillingness to go into the field and conduct dialogue with the conflict parties as welloversee operational requirements such as risk and security management andadequate staff policies. The ability to think out of the box is equally required.

The coordination between field offices and headquarters as well as between the differentunits at headquarters is thus also essential. In the case of the Swiss programme thedecentralised structures of SDC has made it easier to implement the programmeadaptation process. At headquarters the coordination between SDC and PDIV has beentremendously enhanced, sometimes at the cost of the PDII, which is responsible withinthe DFA for the general coordination of the Swiss Foreign Policy.

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5.2 Lessons Learned for programme management in differentdevelopment contexts

The Nepal experience also makes the differences between programme management indifferent development contexts more clear. When analysing the various changes introducedin the Nepal programme, it becomes obvious that the country programme had undergonethree parallel programme adaptation processes between the years 2002 and 2005/06:

1. An adaptation of the programme to the situation of armed conflict;

2. A strategy of development effectiveness in line with the international community’sdesire to harmonize their development policies to foster aid effectiveness (ParisDeclaration on Aid Effectiveness 2005); we can see here two strategies, a first one toprepare a donor country programme for donor harmonization and a second to fosterdonor coordination as a means of reaching for harmonization of donor policies in linewith a countries PRSP;

3. An additional adaptation of this harmonization strategy to the fragile state context inline with the international communities decision to give special attention todevelopment effectiveness in fragile states (Paris High-Level Forum 2005: 7 and‘Principles for good international engagement in fragile states’ March 2005); as a pilotcountry for aid effectiveness in fragile states, individual donors as well as the donorcommunity in Nepal as a whole contribute to new experiences in this regard.

Because the three adaptation processes had been introduced at the same time starting from2002/3 onwards, there was often confusion and misunderstanding (see CSPM missionreport) as to what kind of change within the programme could be attributed to what kind ofadaptation process. As the conflict situation became dominant, most of SDC COOF andproject staff, additionally the staff at headquarters had the impression that almost all strategicand operational changes had been introduced due to the conflict situation. There had beenobvious overlapping between the three processes, it is however important to understandwhat kind of change can be attributed to what kind of adaptation process.

It is obvious that programme management in ‘normal’ development contexts differs fromprogramme management in difficult contexts. It is, however, less clear whether there is adifference between programme management in fragile and conflict contexts. The difficulty isalso linked to the definition of fragile contexts. The definition adapted by the Swiss DFA (seechapter 2.2) includes armed conflict as one of the characteristics of fragile contexts, while theDAC defines mainly weak government institutions and policies as well as a high level ofpoverty as main characteristics of fragile contexts.

Nevertheless, the findings from Nepal suggest that programme adaptation is strongly tied tothe respective development contexts. Pending on the degree of state fragility and the level ofarmed conflict, the programme focus accordingly changes. The work with different scenariosto anticipate potential changing development contexts as well as conflict monitoringinstruments to verify the status of the scenarios is therefore essential.

The table below clusters the main strategies within these three development contexts:

Programme Management in different development contexts‘Normal’ Fragile state Armed conflict

DevelopmentEffectiveness

Preparing bilateralprogrammes for jointdonor response insupport of PRSP

Staying engaged andworking partiallyaccording to developmentneeds to cope with andaddress state fragilitypro-actively

Staying engaged during armedconflict = developmentcontributes to conflicttransformation (CT) and CTcreates conditions fordevelopment. Safety of staff isa major concern and influencesanalysis and decisions.

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‘Normal’ Fragile state Armed conflictGovernmentas main actorindevelopment

Government mainactor in donorcoordination forPRSPimplementation

Weak governmentmight not be centralactor for PRSPcoordination andimplementation

People centred,development needed

Government is conflictparty and does not haveaccess to all areas ofcountry => cannot be onlyactor for development;

People centred,development needed

Preparingbilateralprogrammesfor donorharmonization

Making bilateraldevelopmentprogrammes fit forPRSP harmonization:

Geographicalclusters for moresynergies +developmenteffectiveness

Introducing a‘wholegovernmentapproach’

Mid-termstrategies

Making bilateraldevelopmentprogrammes fit for PRSPharmonization:

Geographicalclusters for moresynergies +developmenteffectiveness

Introducing a ‘wholegovernmentapproach’

Shorter-termstrategies might beneeded, includingwork with scenarios

Making bilateral developmentprogrammes fit for CTharmonization:

Geographical clusters formore synergies + local riskassessment + protectionand defence ofdevelopment space.

Introducing a ‘wholegovernment approach’including PDIV

Shorter-term strategies areneeded including work withscenarios

Donorharmonization

Donor harmonizationin support ofcountries’ PRSP

Donor harmonization insupport of countries’PRSP; however, PRSPmight not be more asreference

Donor harmonization in supportof CT and protection of spacefor development and humansecurity for beneficiaries andstaff. Common Basic OperatingGuidelines, shared analysis aswell as bridging potentialdivides among donors arecrucial.

Transversalthemes

Includingtransversalthemes asintroduced byheadquarters andadapted to thecountry contextReflect themesalso in staffpolicy

Including transversalthemes as introducedby headquarters and(ideally) adapted tothe country context

Reflect themes alsoin staff policy

Including conflict relevanttransversal themes (inclusion,human rights, gender)

Reflect themes also in staffpolicy

Specialprojects

Special programmespending on PRSPand developmentcontext

Special programmes forgood governance and/orcounteracting statefragility

Special programmes forHuman Rights andPeacebuilding

Monitoring ofdevelopmentenvironment

Monitoring ofdevelopmentenvironment (ex:MERV)

Monitoring ofdevelopmentenvironment and puttingadditional emphasis onstate fragility

Monitoring of developmentenvironment and puttingadditional emphasis on conflictcontext

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‘Normal’ Fragile state Armed conflictExtracomponentsonly inconflict

Introducing risk assessmentand security management

Introducing components toaddress consequences ofarmed conflict

Additional time and resources needed for different development contexts

Looking at the above table it is also important to consider the additional time requirements forprogramme management in the different contexts. At first glace it can be concluded thatprogramme management in different development context is different, but not subject tolarge amount of extra work. This depends, however, on the level of state fragility and armedconflict. When it comes to armed conflict on a level that the entire country is concerned, extracomponents are required that need also additional time for COOF and the projects. However,the main additional time is needed for the adaptation process itself and thus depends on therespective process management strategy.

How much additional time has been required in the case of Nepal is not easy to determine,because the perceptions of the involved stakeholders differ tremendously: While people atheadquarters have the feeling the time allocated to conflict related programme issues is atminimum 20% of the extra working time for COOF and project staff. The COOF managementand programme staff have the impression that they need an additional 5-10% extra timerelated to the CSPM, risk management and other conflict related meetings and issues.Project staff on the other hand does not make a differentiation between extra work for conflictrelated issues and the additionally introduced work for coordination and synergies within theSwiss umbrella. They calculate an additional 20% to their normal work load for these twotasks making it difficult to determine an approximation of the figure for specific conflict relatedwork. Furthermore, it must be also understood that not all project staff are equally involved inadditional CSPM or synergy efforts.

5.3 Lessons Learned for a comprehensive strategy for stayingengaged

A comprehensive strategy for peace, human rights and conflict sensitive development isrequired for staying engaged in fragile countries prior, during or in the aftermath of armedconflict. The following graphic shows the main elements of this strategy as developed fromthe Nepal experience. The text below will give a short overview of each of the elements:

Strategy for Conflict Sensitive Development and Peacebuilding in Nepal

CSPM Special projects:HR/PB

Inclusion &quick impactin objective

Projects with trad.dev. objectives

Sector dev.policies

Macro dev.policies

Peacemaking+State building

diplomacy

Policy level

Making DEVpossible inarmed conflict:-Risk Management-DNH

PB onlocal level viaDev. projects

Social+geographical

Inclusion- DNH +

AddressingConsequences

of war

HRpolicies

Aw

aren

ess

+ad

voca

cyfo

rcon

flict

issu

eson

alll

evel

s

CSPM

CSPM

CSPM

CSPMOperational level

TransversalThemes

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The figure comprises three different levels of development, human rights and peacebuildingwork that had been addressed at the same time:

1. Policy level: In the case of Nepal the joint efforts of SDC and PDIV in diplomacy anddevelopment policies had been crucial for creating enabling environments for developmentand conflict transformation. An earlier assessment of the Swiss contribution (see CSPMmission report) returned positive results, besides development sector policies have not beensufficiently used for conflict transformation (It has to be however acknowledged that this hadbeen difficult due to the opposing position assumed by government agencies after February1, 2005).

2. Operational level: Three types of projects can be found: the traditional developmentprojects that could reach their outputs still to a large extent, projects addressing livelihoodand inclusion in their objectives as well as peace and human rights initiatives. During thecourse of the programme adaptation process project by projects had been adapted to theconflict situation in reflecting the following themes either as transversal themes or in theirobjectives:

3. Transversal Themes:In a situation during or after armed conflict some aspects have to be additionally addressedin all interventions like security issues, while the traditional development cross cutting issuesneed to be applied in a conflict sensitive way: this means that some themes might be moreimportant than others or new ones need to be added. The following transversal themes couldbe identified in the Nepal case:

Making development possible:In order to be able to work in a situation of armed conflict,- risk management and a strong focus on staff security is a precondition;- elements of psycho-social matters need to be addressed: For example, staff may

need extra care due to stress and other factors related to working in a situation ofarmed or post-armed conflict. SDC has therefore developed a toolkit to understandand address these issues (psycho-social approach).

- the space for development must be constantly protected by different means (seesection 4.3.1).

Social and geographical inclusion, e.g. addressing the proximate causes ofarmed conflict:In order to work in a conflict sensitive environment it is necessary to undertake a ‘Do noharm’ analysis, e.g. understand what are the root and proximate causes of conflict that needto be considered in each conflict situation and build them into project design forimplementation, either as transversal themes or as objectives. In the case of Nepal, theoverarching issue is the inclusion of marginalized groups and regions into the developmentprocess (see section 4.3.5).

Addressing the consequences of armed conflict: The main consequences of armed conflict that need to be addressed by projects are:- The reduction of livelihood (see chapter 4.3.5) through adding quick impact

components such as food for work, paid community work, or other income generatingpossibilities.

- The socio-psychological problems of staff, partners and beneficiaries (see therespective SDC tool kit);

- The protection of communities by introducing a protection approach (see chapter4.3.5).

Finding entry points for peacebuilding at the local level through developmentprojects: Next to peace and human rights projects, development projects can assess theiroptions for contributing to peacebuilding in their given context. SDC has started to assess the

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entry points for peacebuilding of each project; however the strategy did not fully materializeprior to 2006 (see examples below in box).

4. At all levels:Awareness and advocacy for conflict issues:The Swiss Nepal experience has also demonstrated that advocacy for various issuessurrounding working in and on conflict vis-à-vis the government, other donors and agenciesbut also within agencies and vis-à-vis headquarters has been an important strategy withinthe Nepal programme.

Management aspects (CSPM):COOF introduced CSPM as a management instrument to address values, communicationand processes required for steering a programme and its projects in a context of armedconflict (see chapter 5.1, bullet point no.10).

There had been a great deal of confusion and sometimes misunderstandings both withinSDC as well as among projects and partners regarding the position of CSPM. Thesemisunderstandings are based on different developments and communications of theapproach during the last three years:

COPRET has conducted a number of ‘Peace and Conflict Impact Assessment’ (PCIA)studies to assess the nexus between SDC programmes/projects and armed conflict. Theresults of these assessments led to the development of a practical guide (called CSPM) thatprovides development projects with a process and a number of tools. In this understandingCSPM is a conflict focused assessment process with tools for use by development projectscomparable, for example, to gender assessments (see chapter 2.2.1).

The Nepal programme was one of the first to apply these tools. During application the COOFmanagement the projects were faced with a number of challenges that led to the furtherdevelopment of different tools and procedures. In the face of the operational challenges itbecame clear that the requirements for the management of the programme as well as for thesingle projects in a difficult development context were complex and needed additionalattention. In consequence, the managerial requirements for steering and implementing theprogram and project adaptation process were summarised under the label of ‘ConflictSensitive Programme Management’, e.g. the understanding of CSPM in the NepalProgramme is the management aspect of strategizing and implementing a developmentprogramme in a fragile context with armed conflict. In this understanding CSPM is amanagement procedure.

Another possible misunderstanding of the meaning of CSPM derives from the generalinternational debate on conflict sensitive development and its procedures and requirements(see chapter 2.1.1). In the beginning stages of the debate, after the tragic events around thegenocide in Rwanda in 1994, the role of development in conflict was summarized under thelabel of ‘Do no harm’ or ‘Peace and Conflict Impact Assessment’ (PCIA); the currentmainstream term internationally used to describe development in conflict is ‘(peace) andconflict sensitive development’, whereas ‘Do no harm’ and PCIA now rather understood asprocedures or tools for applying conflict sensitive development. In this understanding ‘conflictsensitive development’ is used as an overarching term.

However, due to the interwoven nature of the different concepts, ‘Conflict SensitiveProgramme Management’ was sometimes confused with broader ‘Conflict SensitiveDevelopment Strategies’/terminologies.

In the Nepal situation the confusion was augmented as many agencies, including Helvetas,have pushed for the application of the ‘Do no harm’ approach. When CSPM was introducedlater by SDC, it became unclear what differences lie between ‘Do no harm’ and CSPMbecause cross-fertilisation of their meanings had occurred.

35

In sum, the different understandings contribute to confusion rather than clarity. Thus a unifiedterminology and understanding within SDC should be reached (see chapter 6.2).

Entry points for peacebuilding at local level – SDC’s experiences As outlined in the Swiss Cooperation Strategy for Nepal 2005 – 2008, SDC committed itselfto contribute to local conflict transformation and peace building by communicating actively ondevelopment related issues with all conflicting parties including. the CPN (M) and thusacknowledging them as political actors and force. The Basic Operating Guidelines adoptedby 10 bilateral donors and the UN system in October 2003 were widely used to inform theparties to the conflict about our values, our opportunities and limitations. The BOGs werealso an entry point to build up trust and to discuss development issues with the CPN (M).This engagement created an environment of dialogue at the local level. Since the peoplesmovement and ceasefire agreement between the SPA and CPN (M) of April 2006, newopportunities to support local reconciliation and peacebuilding through development workhave emerged. Some examples on how SDC tries to take advantage of such opportunitiesare presented below:

i) Public Hearing conducted by SDC in the three districtsIn February 2006, SDC decided to present to the District Development Committees (DDCs)its program for the fiscal year 06/07, inviting the local administration and the line ministries.After the jana andolan movement, the political scenario changed so drastically, that it wasdecided to conduct a full fledged Public Hearing with all district stakeholders (SPA, otherpolitical parties’ incl. CPN (M), civil society as well as the general public);open access to thehearing was provided along with a question and answer session following the SDCpresentationThe public hearings brought together the various political and social actors of the district HQsand provided space for a public debate on development.Entry point for local peace building: old as well as new grievances were expressed (includingconcerns about salaries); conflict and non conflict related issues were debated and somedevelopment relevant questions could be addressed. The boycott of the event by some ofthe political parties in Dolakha allowed us to engage in a discussion with all political paritiesand to re-build relationships which were neglected during the time of open conflict. Thesediscussions also helped us to understand better the power dynamics in the districts HQs andto be more effective connectors.

ii) Approval of the health project YPO by the district of DolakhaDuring the Jana Andolan movement many people were black listed, including two of ourhealth staff in Dolakha. In addition, the project was boycotted openly by the paramedicalassociation using various forms of pressure incl. sit-ins in front of their office. In considerationof staff safety, COOF arranged discussions with the paramedics to understand theirgrievances and look for solutions. A YPO discussion was initiated thereafter, but theparamedics at the meeting became aggressive and the meeting was concluded before anyagreement could be made. Again COOF became engaged and went to the district andexplained the situation to all the political parties (incl. CPN (M)), civil society and local as wellas national authorities. The main message at this point was that the project could and wouldwork in the district, only if it was welcomed and accepted by all stake holders. After about amonth, various meetings, with all political forces and civil society representatives), took placein Charikot, and a solution was found that was approved by the YPO at the district level.Entry point for local peace building: the temporary suspension of the rural health projectforced all district stakeholders to convene and discuss beyond established politicalboundaries, hatred and animosities about a specific problem.

iii) Approval of District Transport Master Plan (DTMP) in RamechhapThe mandatory preparation of the DTMP was conducted by the District DevelopmentCommittees, with financial support of SDC District Roads Support Program. When werealised that the DRSP objective was to conduct the planning as fast as possible for the roadproject to begin, we intervened and explained that as development agents, in present peace

36

process, we have to ensure that decisions are taken by inclusive committees. Meaning thatunless all stakeholders are part of the DTMP process no financial support shall be given byDRSP.Entry point for local peace building: even though projects are still tentative and COOF mustmonitor this closely, SDC expects all political forces to be associated in the formulation ofcritical medium term development plans. These discussions on concrete and practicalmatters are part of a general trust building process, which must occur at the central as wellas at the local level.

iv) Kavre / Ramechhap - MBsThe CPN (M) “administration” of the Kavre / Ramechhap District, belonging to the“autonomous Tamang region”, has been a difficult “partner” since the conflict began. Manyrounds of discussion were conducted in order to gain minimal acceptance and access to theirareas. A few weeks ago, we conducted a meeting with them presenting each projectindividually. Of particularly interest to them was our concept of Community Drug Program; aconcept which works with revolving funds. Although they did not accept this program, theyagreed to let the District Health Office, in charge of the program implementation, to join themeeting and to explain in detail how it works. Despite some opposition about the status ofthe health care sector, the CPN(M) cadres at least agreed that the MB will observe a CDPprogram in other VDC; and thereafter decide if they would like the program.Entry point for local peace building: asking government staff to explain an aspect of thehealth sector policy to CPN (M) is an opportunity to bring the CPN (M) into mainstreamthinking.

Text provided by Geneviève Federspiel, Deputy Coordinator SDC COOF Kathmandu

5.4 Lessons Learned for useful instruments when stayingengaged

Development Context AnalysisIn order to stay engaged, the development context needs to be analysed in depth: From theNepal experience we learned that staff at headquarters and in the field largely appreciatedtwo kinds of analysis:

1. Analysis that is of direct use for programming is appreciated most by headquartersand field staff. SDC utilized MERV for this purpose and were pleased with the mannerin which analyses were conducted and developed by COOF Kathmandu (seeexample in annex 6). Field staff equally validated the Local Risk Assessments. Theinformation from these assessments, completed by SDC and project staff, wasabsorbed into the MERV discussion.

2. General analysis of the situation, such as a conflict analysis study, is only appreciatedin the early phases of programme adaptation when there is a lack of such informationin the country. At a later stage only high quality qualitative analysis that are publishedregularly are appreciated, for example the reports of the International Crisis Group.

Risk and Security managementThe ongoing risk assessment, e.g. local risk assessments as well as cooperation andinformation exchange, between the security officer as well as the head of agency (in the caseof Nepal via the BOG group) with other donors and agencies is a further requirement forstaying engaged. The recruitment of a security officer within COOF and the appointment ofliaisons officers in the cluster districts have also been useful.

Working with different future scenariosThe development context in situations with latent or manifest armed conflict can changequickly. It is therefore a necessary requirement to be prepared for diverse futuredevelopments in preparing possible working scenarios. These scenarios serve two purposes;first, programme and project development: it is important to develop implementation plans for

37

potential scenarios; second, scenarios can also be used as a means to heighten awarenessamong donors and agencies for joint future action needs.

It is also important that scenarios be somewhat specific and include a mechanism to assessthe validity of scenarios, e.g. when could the next scenario be applied.

Regular programme and project planning exercisesFollowing the cycle of MERV (in the case of Nepal the frequency has been quarterly), theprogramme and the projects need to be flexible (in terms activities and budgets) in theiradaptation to changing situations.

Instruments for defending the space for development- Staying engaged in the conflict affected areas- Communication with all parties to the conflict- Joint Operating Guidelines (BOGs)- Linking local with national and international initiatives- Ensuring home support- Introduction of a Swiss umbrella for SDC and SDC funded projects- Public hearings

Advocacy and awareness building about conflict issuesThis has been a fundamental instrument for working in and on conflict as not all involvedactors have been aware of the conflict situation; especially the bigger donor agencies do notwork in the rural areas and thus often cannot gauge the situation appropriately. It is thereforecrucial that those agencies, which are field and capital based, advocate for conflict relatedissues as a precondition for joint donor responses. In the case of Nepal DFID and SDC haveplayed a crucial role at this juncture.

Instruments for project by project adaptation- Management commitment- Context analysis- Risk assessment- Process focal points- Joint strategy planning workshops- Joint learning events- Stronger coordination role of SDC- Public hearings

Management instruments:- Leadership commitment- COOF organisation around programme adaptation needs- Empowerment of local COOF and project staff- Flexibility in budget allocation- Establishment of additional ‘political’ posts such as ‘peacebuilding’ or ‘human rights’

advisors send by PDIV.

5.5. Lessons about comparative advantage of SwitzerlandSwitzerland as a political and development actor has a number of comparative advantagesthat enable SDC and PD IV to respond to fragile conflict contexts in an effective way. It isimportant that COOFs and embassies are aware of these advantages and use themaccordingly. The main Swiss comparative advantages are:

- Switzerland is accepted as a neutral country by local, national and internationalactors; the close relationship to the ICRC and the fact that Switzerland is the depositstate of the Geneva convention foster this image;

- Switzerland can act as a political as well as a development actor;

38

- SDC is a donor and an agency at the same time; it thus remains linked to the fieldand has an insider understanding what is going on in the rural areas (what mostdonors do not have). Through strategic partnerships with local and Swiss NGOs, theSDC and PDIV can further assess and influence the situation on the ground, which isfostered by the decentralized organisational structure of SDC.

- Switzerland is known for its competency in local development, human rights andpeace promotion;

- SDC is often engaged on a long-term basis, especially in priority countries, and thushas good knowledge and networks;

- Due to the small size of the Swiss administration (in comparison to others) the Swissgovernmental agencies can quickly and flexibly react to changing situations; this isfostered by budget flexibility from the side of SDC and PDIV;

- As a small donor / actor Switzerland has a tradition of cooperation with other actorsand also is willing to take the lead and/or lobby in respective forums. Therefore, theinfluence of Swiss interventions is usually much higher than the respective budgetwould suggest.

6. Recommendations

6.1 General recommendation for programme adaptationprocesses

§ Stay engaged with development programmes as long as possible;

§ Enhance awareness for different kinds of adaptation processes (aid effectiveness,fragile states, conflict);

§ Programme adaptation processes are best started with a systematic strategy buildingexercise involving all relevant actors in Berne and in the respective country to agreeon strategic elements of a joint comprehensive Swiss strategy and modalities forprogramme adaptation, and to seek experienced facilitation for the process anddefine management responsibilities;

§ Systematically assess all options for making effective use of ‘whole government’approach including multilateral policies (development and diplomatic, e.g. IFIs, UN,OECD, etc.); this includes also a strategic linkage between projects and policies.

§ Make programme adaptation a leadership issue and nominate focal points for projectadaptation;

§ Ensure adequate staff recruitment and building capacity to cope with the respectivechallenges; for a joint Swiss strategy also diplomatic (peacebuilding and/or humanrights) expertise is needed and the establishment of posts such as peacebuilding orhuman rights advisors is crucial.

§ Ensure knowledge management and transfer in the light of staff rotation;

§ Lobby for protecting the space for development/humanitarian action including aprotection approach for staff, partners and beneficences;

§ Work with like minded donors and try to bridge divides within donor communities atthe same time by constructive engagement with opposing actors.

Instruments

§ Use SDC Nepal’s MERV (output and process) as a model for the development ofMERV reports in all countries along the defined frequencies (see annex 6 and boxpage 22). In consequence MERV should become the principle instrument for

39

programme planning and adaptation; additionally Local Risk Assessments can beintroduced;

§ Establish flexible programme and project planning according to the MERV cycle andwork with scenarios;

§ Assess options for the introduction of geographical clusters and a Swiss umbrella inother countries;

§ Engage in project by project adaptation, assessing for each project the bestcontribution to programme adaptation, e.g. integrating conflict related transversalissues, identifying local entry points for peacebuilding, assessing conflict sensitivesector policy options; developing a strategy to address the consequences of armedconflict;

§ Foster exchange between development and humanitarian security management forcountries with conflict and link more SDC senior management staff to the internationalSecurity Management Initiative (SMI) funded by PDIV’s humanitarian policy section.

6.2 Recommendations for SDC and especially for COPRET- Clarify understanding and meaning of CSPM.

- Add programme focus to current tool-based project focus within CSPM folder.

- Develop management guidelines for programme adaptation processes.

- Maintain learning team at SDC headquarters and involve other divisions and sections(PD II; IV; SDC geographical sections) working in conflict countries.

- Link debate about development in conflict with fragile states DFA working group.

- Advocate for other knowledge management and lessons learned processes in othercountries: start a project to compare learning of SDC and other donors/agencies insimilar situations to contribute to DAC guidelines for working in fragile, conflictcontexts.

- Disseminate results from lessons learned in Nepal

o Within the SDC through a learning team; CSPM folder andevents;

o Within DFA through fragile state working group;

o Within the Swiss development audience through dissemination ofbooklets, events and KOFF working group on conflict sensitivedevelopment;

o Among other donors and agencies through presentations at therespective DAC working groups.

- Incorporate lessons from Nepal experiences into training modules.

- Seek an official SDC policy paper for development work in conflict countries thatprovides clear management guidelines.

- Clarify further the role of PD II with regard to programme adaptation processes; whilePD II is involved in coordination at headquarters, it seems to be insufficientlyrepresented throughout the adaptation process. For example no representative ofPDII has ever participated in a strategy development workshop in the field.

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Annex 1

TP 30.11.2005 1

Research Framework for Project:Adapting Development programmes to situations of armed conflict and fragile

contextsThania Paffenholz 2005

Issue 1: Conflict Monitoring and Analysis Capacity1. Objective and meaning of research issue:This part looks at conflict related monitoring and analysis capacity such as MERV, FAST,international conflict reports, local reports, SDC mission reports, strategy and planningdocuments, situational analysis and embassy reports, etc.

2. Before/After comparison: How was the situation of analysis prior to the conflict situation?

3. Key research questions:§ What is the standard analytical capacity and what additional tools have been created for

working in a conflict situation? (type, frequency)§ Who are the authors of the various reports (institutions/functions – not specific people,

e.g. head COOF))§ How are the reports used and by whom?§ What is the influence of these analyses on decision-making process (Field and HQ)?§ Did the program change due to the results of the analysis?§ What was helpful, what was not, what should not be done again?§ Is it possible to derive any guidelines or recommendations?

4. Research hypothesis:New analysis capacities are created and the frequency of reports increases. The use of thefindings of the general analysis is used for programming only in a limited way

__________Issue 2: Program Management and Strategy: Changes and Requirements due toConflict1. Objective and meaning of research issueThis research issue looks at program management in general (including aspects likedecision-making, competences, job requirements for staff, project management by Coof) andidentifies changes in program management in countries in conflict compared to standardmanagement in non-conflict countries.

2. Before/After comparison: How was the programme management prior t the conflictsituation?

3. Research Questions:§ Do management procedures change compared to standard management? E.g.

competences in decision-making process: does the country director have enoughcompetences to manage the program in a conflict situation?

§ Which additional management requirements are needed for conflict situations?§ Staff: which skills are required?§ How did the program change?§ What was helpful, what was not, what should not be done again?§ Is it possible to derive any guidelines or recommendations?

4. Research hypotheses:§ In countries in conflict, development managers require more political thinking and

diplomatic skills than in non-conflict countries.§ New challenges to management procedures§ Additional staff is required due to conflict situation (for example human right or

peacebuilding advisors, security managers)

Annex 1

TP 30.11.2005 2

_______________Issue 3: Policy Level1. Objective and meaning of research issue:This section examines how the Swiss engagement changed at the political level (SDC andDPs). Policy in this context means the political positioning and engagement of SDC and theSwiss government as a whole toward the conflict situations and parties (as opposed tooperational program level).

2. Before/After comparison: How was the programme management prior t the conflictsituation?

3. Key research questions:§ What kind of activities/positions can be identified?§ Did the policy activities increased?§ With whom did SDC cooperate, with new or old actors, national or civil, NGOs?§ In which donor working groups is SDC active and plays what kind of role and positiong)§ Did the cooperation with other agencies increase?§ What was helpful what was not, what should not be done again?§ How did the policy level change?§ Who was involved in decision making in COOF and Berne as opposed to non conflict

situations?§ Is there a specific Swiss approach/positioning to be identified?§ How is Switzerland perceived by the conflict parties and other actors?§ Is it possible to derive any guidelines or recommendation?

4. Research hypotheses:§ There are more activities at the political level of development and peace building§ Switzerland is perceived as neutral actor and can achieve more in comparison to

development inputs due to long term engagement and perception of neutrality§ Increased cooperation with like minded donor countries§ More coordination efforts with Bern (DP II due to position vis-à-vis government ), e.g.

increased diplomacy/dev. cooperation.____________Issue 4: Project level bilateral cooperation development programme1. Objective and meaning of research issue:

This section looks at the project level of bilateral cooperation and wants to find out, whatchanges have been made within bilateral projects due to the conflict situation. It also looks atthe mainstreaming of conflict-sensitive program management in SDC programs/projects.Mainstreaming means the integration of a theme/issue in all parts of the relevantorganizational structure and procedures.

2. Before/after comparison: Standard procedures „non conflict“:

What are the SDC standard procedures for mainstreaming in general in non-conflictcountries, e.g. for HIV/AIDS or gender?

3. Key research questions:§ How are SDC’s bilateral E-project affected by the conflict/fragile situation?§ How was peace/conflict mainstreaming of the development program approached?

- chronological order of activities- by whom were they initiated (Coof, HQ-Copret, HQ-Asia II)- Types of tools and activities- Which were useful and which weren't?- How has the mainstreaming process changed relationships to partners.

§ Which partners were supported?§ Old or new partners (type and changes, also role of civil society vs. gov.

actors, NGOs)

Annex 1

TP 30.11.2005 3

§ How did the program change?§ What was helpful, what was not, what should not be done again?§ Is it possible to derive any guidelines or recommendations?

4. Research Hypothesis:non_________Issue 5: Project level multilateral cooperation development programme1. Objective and meaning of research issue:

This section looks at the project level of multilateral cooperation and wants to find out, howSDC approach multilateral cooperation projects due to the conflict /fragile situation and alsoiwhat changes have been made within multilateral projects due to the conflict situation. It alsolooks at the mainstreaming of conflict-sensitive program management within thesemultilateral programs/projects. Mainstreaming means the integration of a theme/issue in allparts of the relevant organizational structure and procedures.

2. Before/after comparison: Standard procedures „non conflict“:

What are the SDC standard procedures for multilateral cooperation projects.

3. Key research questions:§ How did SDC’s approach multilateral E-programs/project in the conflict/fragile situation?§ How are SDC’s multilateral E-programs/project affected by the conflict/fragile situation?§ How was peace/conflict mainstreaming of the development program approached?§ How did the multilateral cooperation change?§ What was helpful, what was not, what should not be done again?§ Are there any guidelines and recommendations for multilateral cooperation programs in

conflict, fragile contexts?§ Is it possible to derive any guidelines or recommendations?

4. Research Hypothesis:- Multilateral cooperation increases due to the conflict situation- SDC takes part within multilateral programmes with little resources but a lot of influence(see also political level)

_____________Issue 6: Role of Humanitarian Aid (H)1. Objective and meaning of research issue:This section looks at the project level of bi- and multilateral cooperation within theHumanitarian aid and wants to find out, how the H-programme reacted towards theconflict/fragile state situation and how it links to the E-programme (RRD continuum) andwhether it has included any elements of conflict sensitive programme management (CSPM).

2. Before/after comparison: Standard procedures

What are the SDC standard procedures for implementing H-programmes in conflictsituations? Are there any standard (if yes, which one) for mainstreaming conflict issues in H-programmes?

3. Key research questions:§ How is SDC’s H-programme affected by the conflict/fragile situation?§ How was peace/conflict mainstreaming of the H- program approached?§ How did the program change?§ How was the RRD continuum approached?§ What was helpful, what was not, what should not be done again?§ Is it possible to derive any guidelines or recommendations?___________Issue 7: SDC programmes/project that are specifically addressing Conflict/Peacerelated activities

Annex 1

TP 30.11.2005 4

1. Objective and meaning of research issue:This section analyses conflict transformation and peace-building activities by SDC ondifferent tracks and with different cooperation partners.

2. not applicable

3. Key research questions:§ Since when has the support for peace project increased?§ What kinds of projects have been supported?§ Which partners have been supported ( also role of civil society vs. gov. actors, NGOs)§ What was helpful, what was not, what should not be done again?§ Were the new projects conducted or funded rather bilaterally or together with other

actors/partners?§ How did the program change?§ Is it possible to derive any guidelines or recommendations?

4. Research Hypothesis- New types of projects are being implemented- New partners- Closer cooperation with DPIV

______________Issue 8: Human Rights1. Objective and meaning of research issue:Human rights are an important issue within conflict situations This issues looks into thequestion n which way SDC addresses human rights issues, be it on the project or policylevel.

2. Comparison: How is the issue of human rights approaches by SDC in general – are thereany standard guidelines?

3. Key research questions:§ How is the issue of HR approached?§ Are there any specific HR activities?§ If yes,

o Since when has the support for HR project increased?o What kinds of projects have been supported?o Which partners have been supported, new or old ones?o With which donors did SDC cooperate?

§ What was helpful what was not, what should not be done again?§ How did the program change?§ Is it possible to derive any guidelines or recommendation?

4. Research Hypothesisnon___________Issue 9: Program Partner Relationships1. Objective and meaning of research issue:This section explains the relationship between SDC and its partners at the implementationlevel. That includes the Government, INGOs, local NGOs and individual persons. Theobjective is to point who are the partners, the changes in the structure and way ofpartnership due to the conflict situation.

2. Before/After Comparison: How is the partnership in ‘normal’ situations? Who are the mainpartners of SDC in general (types of partners) and how does the structure and system ofpartnership functions in non-conflict situations?

3. Key research questions:

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TP 30.11.2005 5

§ What are the changes in SDC's structure of partnerships regarding type of partner (e.g.local NGO, Swiss NGO, etc.) and kind of partnership due to conflict situation?

§ What is SDC's general policy regarding partners in conflict situations?§ How was the program affected due to these changes?§ What are the political implications, if any?§ Are there any new partnerships? How did the old partnership change?§ What was helpful what was not, what should not be done again?§ Can there be any guidelines, recommendation be derived for the future cooperation?4. Research hypotheses:§ SDC increasingly works with strategic partners like Helvetas.§ Less work with government, more with NGOs.§ Affect on program: Need for more direct implementation mechanisms_________________Issue 10: International Cooperation within the donor community1. Objective and meaning of research issueCooperation between the SDC and other donors in the context of a conflict is discussed.Cooperation in this context means the forums and other ways of cooperation where donorsmeet.

2. Standard procedures for donor cooperation where SDC is involved in normal situations?

3. Key research questions:§ Have there been any additional forums established due to the conflict situation? If yes, by

whom and when?§ In which forums did the SDC take part?§ What is the role of the Swiss actors within these forums, at which level (lead, member)?§ What other ways of cooperation (joint projects, workshops, joint political statements)

exist?§ Which function has the cooperation between SDC and the international financial

institution? How does this cooperation materialize? What is the role of the IFI in a conflictsituation?

§ Did the “normal” forums change due to conflict and if they did, how?§ Did the changes in the cooperation cause any changes at the program or policy level?§ What was helpful what was not, what should not be done again?§ Is it possible to derive any guidelines or recommendation?

4. Research hypothesis:§ The cooperation increases due to the conflict§ More forums established§ Some of the normal forums changed functions§ Switzerland plays important role within the forums, but no lead – is lead interesting? If

yes, where and in which way?._____________________§ Issue 11: Cooperation COOF- Berne (HQ, PD II, PD IV Asia II)1. Objective and meaning of research issue:In this section the cooperation between Berne and the Coordination Office (coof) is explainedand examined. Cooperation in this context means the way how the decision makingcompetence is distributed among the different actors.

2. Before/after comparison: Standard procedures

What are the SDC standard procedures for cooperation in normal situations?

3. Key research questions:§ How did the cooperation change due to conflict situation?§ Are there any new challenges the cooperation is confronted with?§ With whom does the COOF cooperate in Berne?

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TP 30.11.2005 6

§ Is the decentralization process still on going or did it change due to the conflict? If itchanged how did it change?

§ Who is responsible for what? How is the decision making competence distributed?§ How did the program change?§ What was helpful what was not, what should not be done again?§ Is it possible to derive any guidelines or recommendation?

4. Research hypotheses:§ The cooperation enhances and changes due to the conflict situation.§ Berne has regained more decision making power due to conflict and the politicization of

cooperation§ New co operations established (PD IV, COPRET)

______________• Issue 12: Cooperation in Berne (EDA, DEZA)1. Objective and meaning of research issue:This section examines the cooperation between the relevant actors involved in thedepartment of foreign affairs in Berne (PD II; IV, SDC, HH). How this cooperation functionscan be observed in the coordination meetings.

2. Before/after comparison: Standard proceduresWhat are the SDC standard procedures for cooperation in normal situations?

3. Key research questions:• How did the cooperation change?§ Are the changes - if any - specific to the country or can they be observed generally in

states in conflict ?§ When does the PD IV become a cooperation partner?§ Are there any new challenges the cooperation is confronted with?§ What was helpful what was not, what should not be done again?§ Is it possible to derive any guidelines, recommendation?

4. Research hypothesis:§ The cooperation increases due to the conflict situation.§ New actors participate___________________________

• Issue 13: Public Opinion1. Objective and meaning of research issue:This section explains how SDC is represented and seen in public as well as how SDCcommunicated vis-à-vis the public. Public opinion in this context means when and howfrequently is talked about SDC in the specific country in Switzerland and in the field. Meansof public representation are: media (newspaper articles, radio features etc.), parliamentarianrequests, Bürgerbriefe, etc.

2. Is there any standard for communication?

3. Key research questions:§ Was there a communication strategy?§ How has the communication strategy changed?§ How is the representation of SDC in country X in the media (in Switzerland and country

X)?§ Were there any parliamentarian requests/inquiry?§ Was there a public debate about the SDC Program to leave the country? § Was there a need to legitimate SDC work in countr so which is a country in conflict or/and

a fragile state? § Is there a need to go public through new channels in such a situation?§ What was helpful what was not, what should not be done again?§ Has this had any impact on the program?

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TP 30.11.2005 7

§ Is it possible to derive any guidelines, recommendation for other E-countries working inthe context of a conflict?

4. Research hypothesis:§ In a context of a violent conflict more communication is needed and a communication

strategy needs to be designed form the beginning in order to avoid problems withlegitimatization.

Annex 2a

Component 2: Livelihoodand Inclusion

Core process: from vast inequalityin access to resources and

opportunities for socially excludedgroups to real improvements insustainable service delivery andlivelihoods for the poor and theexcluded in the context of the

political conflict.

Component 3:Meaningful Dialogue andConflict Transformation

Core process: from civil war,political power struggles and the

deteriotaion of human rightsto peace and an inclusive

democracy.

Conflict-Sensitive Programme Management CSPM

Global Framework and Goals: MDGs, OECD/DAC Principles forEngagement in Fragile States, Aid Effectiveness and Harmonisation

Component 1: HarmonizedBi- and Multilateral

FrameworkCore process: from separate or loosely

tied initiatives to orchestrated andcoordinated efforts that bridge the

bilateral/multilateral divide.

Annex 2b

2

Swiss Programme in Nepal

I Harmonised Bi- and Multilateral Framework • Asia Pacific Mountain Network• Coordination Office Kathmandu• ICIMOD Core Contribution• Mountain Forum Secretary & Global Info Server Node• PARDYP• Promotion of Rights of Indigenous People• Regional NRM Capitalisation & Exchange

II Livelihood and Inclusion

Rural Infrastructure Mobility is an important prerequisite for the social and economic exchange in any society andNepal's socio-economic activities rely heavily on trail and road based transport. Thereforemaintenance of the existing roads and trail network and opening up additional areas withroads is the major objective of this sector, thereby facilitating the mobility of the people andthe exchange of goods in Nepal.

• DRILP• DRSP District Roads• SMD II Maintenance Division• TBSSP Trail Bridge Sub-Sector• Transport Sector Support

Natural Resource Management The Natural Resource Management sector programme in Nepal aims at improving thelivelihood of small farming families in rural areas through the sustainable management ofnatural resources and the protection of the natural heritage of Nepal. To this end, programmeimplementation takes care not to address ecological issues in isolation, but in combinationwith economic and social issues through the promotion of income generating activities aswell as increased awareness of gender and social equity in communities and partnerinstitutions.

• Homegarden • Electric Vehicle• HMRP Hill Maize Research• IUCN Nepal Support• NSCFP Community Forestry • SSMP Sustainable Soil Management • Vegetable Seed • VSBK Nepal Brick Sector

Health Promotion • HIV/AIDS• RHDP

Occupational Skills Development The overall objective of the Occupational Skill and Enterprise Development (OSED) sector isincome generation and employment promotion. In order to contribute to this overall objective,the sector supports and promotes three domains, which are employment oriented andaffordable Occupational Skills development through Technical Education and VocationalTraining, Self Employment promotion as well as micro and small enterprise development.The creation of an enabling environment as well as the promotion of linkages between the

Annex 2b

2

three domains as well as with other sectors are encouraged to enhance the impact of theprogram.

• Consultancy OSED sector development• Franchising-Skill • Global credit OSED sector development• TfE Training for Employment • TITI Techn. Instructor Training

Humanitarian Aid In Nepal, SDC humanitarian aid intervention focus on two areas: rehabilitation activities afternatural disasters and conflict related activities. Floods and landslides are a constant threat inNepal causing recurring disasters. However, only in the worst cases, SDC is in a position tosupport the country. For example after the devastating floods of 2002, SDC supported therehabilitation of bridges, road sections of the strategic road net work, as well as thepreventive construction of dikes in extremely vulnerable areas. In an on-going conflict inNepal, with more than 10'000 killed people up to date and an uncounted number of affectedpeople, SDC supports conflict victims through its projects, contributes to the ICRC programin Nepal and Humanitarian Aid Information System (HAIS), developed and implementedunder the UN umbrella. In addition, SDC has also seconded an Officer to WFP.

• Conflict Mitigation• Continuation ICRC • Floods Disaster div.• Humanitarian Emergency Relief

III Meaningful Dialogue and Conflict Transformation

Support to Governance and Peace Initiatives According to the Governance Concept Nepal (August 2003), SDC Nepal aims atmainstreaming governance related issues such as transparency, accountability, participationand empowerment in all its sector projects. Furthermore, special emphasis is being given tointroduce specific tools and instruments that shall enable the projects to better cope with theconflict situation (local conflict assessments, do no harm, women in conflict, human rights,trauma counselling). In addition, SDC Nepal supports and accompanies - through catalyticprojects - Nepali initiatives in the areas of peace building for development, human rights andaccess to justice, the political system and local governance (decentralisation) and socio-economic aspects of governance, particularly corruption.

• Contribution PA IV• UN HR Mission support & secondment• Peace policy activities• Special Peace Adviser• Coof Small Action• Decentralisation for Inclusion• Human Rights Monitoring OHCHR Project• Good Governance Programme• Governance Development • Strengthen Political Parties

OTHERS

Programme Contribution to NGOs

Annex 3

Executive summary: CSPM Mission report to Nepal 10-25 February2006This mission report is part of a process to support SDC in its endeavours to adaptdevelopment programmes to situations of armed conflict and learn lessons from the SwissNepal programme. More detailed analysis of and learning from the Swiss Nepal programmealso in the light of other actor’s contributions will be shared in the final project report.

There has been much confusion and sometimes misunderstanding both within SDC as wellas among projects and partners what ‘Conflict Sensitive Programme Management’ (CSPM)is all about. These misunderstandings are based on different developments andcommunications of the approach during the last three years. In sum, ‘(Peace and) ConflictSensitive Development’ should be used as the overarching term/concept to describedevelopment during or after armed conflict. This includes different strategies, procedures andinstruments as well as CSPM as an additional management requirement. Part of themisunderstanding related to CSPM in Nepal also derives from the fact that the managementof the Nepal programme introduced a serious of organisational changes; some of them areclearly linked to making the programme more effective in general while others are solelylinked to making development possible and effective in a situation of armed conflict.However, as many procedures have been introduced at the same time, the impression bymany people at headquarters and within projects arose that all these new procedures havebeen introduced due to the situation of armed conflict.

The main results of the mission can be summarised as follows:Overall, SDC Nepal programme can serve as a model for development effectiveness in afragile context of armed conflict. The COOF management has successfully introduced manychanges that culminated in a new strategy for working in and on conflict. The generaldirection of these changes is received positively by all COOF and project staff. However, dueto the number of changes and their quick application, we can see a number of negative sideeffects that are normal when it comes to organisational changes, yet, need to be furtheraddressed. In addition, room for improvement can be seen in a number of points that areaddressed in chapter 3.5. It has to be also acknowledged (and will be further discussed inthe project report) that SDC has been engaged in conflict sensitive development in a jointendeavour with other donors, agencies and institutions. This report, however, focuses mostlyon SDC’s contribution.

On the policy level COOF is engaged in a) peacemaking and state building diplomacy via thespecial advisor for peacebuilding, b) has been and is a key actor in promoting human rightsthrough the work of DP IV supported by the human rights advisor in COOF; c) macrodevelopment policy dialogue with other donors, agencies and the government. Here the SDCcountry director is highly recognized and holds key positions within different donor forums;the role of Switzerland is perceived by most donors and agencies as crucial! SDC has alsoplayed an important role in advocacy for respective conflict issues within the donorcommunity.

On the operational level SDC’s approach to conflict sensitive development shows mainlythrough the way development projects have been adapted to the conflict situation byaddressing the following issues in a systematic/strategic way:- Making development possible: SDC has a strong focus on security for COOF and all

projects, has strengthened the effectiveness of MERV, introduced local risk assessmentsand addresses socio-psychological problems of COOF and project staff due to working inconflict;

- Focus on ‘Do no harm’ through an inclusive approach to development and staffrecruitment (social and geographical);

- Finding entry points for peacebuilding through projects, e.g., addressing the politicalconflict also through development project’s presence in the field;

Annex 3

- Awareness and advocacy for conflict issues: SDC COOF has become an advocate forthe need to work conflict sensitive within the donor and agencies community, vis-à-visprojects, the government and headquarters;

- CSPM: In introducing CSPM SDC/COOF has acknowledged that working in conflict is notjust about introducing tools and procedures but implies a management responsibility andrequirements for steering and managing a development programme and its projects in adifficult context. The need to also include a management component into ‘ConflictSensitive Development’ strategies becomes a major learning from the Nepal case for theinternational debate.

The main strengths of the Swiss Nepal programme are to be found in:- Comprehensive and coherent understanding of development in armed conflict that links

the political with the operational;- Operationalisation of conflict sensitive development on the project level that goes beyond

‘Do No Harm’;- Strong leadership;- Combining of long-term development goals with quick impact livelihood focus and

people-centred inclusive development;- pro-active utilization of Swiss logo, umbrella and flexibility in implementation and budget

allocation;- strategic and innovative use of existing and new instruments and effective risk

management.

The following issues should be further addressed in the light of improving theprogramme:- Harmonization on macro policy level within the Swiss programme and within the donor

community;- Strategising connectedness between development, quick impact and humanitarian aid as

well as clarification about disadvantaged groups, e.g. critically assessing thedevelopment potential of the ‘poorest of the poor’ and

- Politization and lack of inclusiveness of implementing partners;- Working on conflict through development projects;- Compensating negative side effects of quick application of development effectiveness

and conflict sensitive development.

Annex 4

1

Executive summary: Bridge Building in Times of Armed Conflict: Peaceand Conflict Assessment of PCA of ‘Trail Bridge Sub Sector Programme

(TBSSP)Carrying a legacy of more than 40 years of trail bridge building in Nepal, SDC with its executingpartner Helvetas started a new phase named as ‘Trail Bridge Sub Sector Programm’e (TBSSP) inJune 2001 with the main objective of contributing to improved living conditions of rural people andfacilitation of socio-economic growth through access to market centres and basic services by thesupport of constructing the most cost-effective river-crossings.

The objective of the appraisal is to give advice and critical reflection to TBSSP with regard to thepeace and conflict sensitivity of the project as an input into program planning for the next phase.

The results presented in this report were elaborated on the basis of a joint discussion process withthe TBSSP team, Helvetas and SDC and a peace and conflict appraisal.

Main resultsMinimizing risks: TBSSP is facing security, political and economic risks due to the conflict situation.The main risks for the project is its total dependence on Maoist’s acceptance of bridge buildingfunds via DDCs (especially with the RAIDP and DRILP components), which is thus the core ‘killerassumption’ for the functioning of the project. In order to compensate this potential risk a two pillarstrategy needs to be applied including 1) a dialogue with the Maoists to get general acceptance forDDC funding and 2) the installation of a parallel implementation mechanism aside from DDC funds.More conflict sensitivity, less sustainability focus: The project has achieved a lot with regard tosustainability over the years, especially through the capacity building strategy. In a ‘normal’situation the project’s activities would be handed over almost fully to the government (e.g. theDDCs) and would only do a little monitoring for an agreed period. However, weak governance thatis accelerated due to the conflict situation (as we see a lack of democratic control) hinders theeffects of the sustainability achievements. In consequence, the project should continue its capacitybuilding efforts where they still make sense, should however put stronger emphasis on conflictsensitivity rather than support sustainability elements that are even hard to implement under‘normal’ circumstances. This means• in the SDC districts- do not attempt to phase out the current mode of providing materials with post-financing;- do not attempt to source out cables in times of armed conflict as the entire security of the

bridges depends on the cables;- do not phase out project implementation in cluster areas of the Swiss umbrella to make use of

synergies.• TBSSP needs to come up with a new monitoring strategy that includes close monitoring of- the DDC’s application of the Trail Bridge Strategy ,- potential theft of materials;- NGO implementation processes;- workers get paid in time and in an equitable manner, etc.• TBSSP needs to reassume some implementation activities when DDC technicians cannot go.• The gradual transformation of a powerful development project such as TBSSP in times of

conflict with regard to challenges posed to management, to come closer to Helvetas/SDCprojects, to create solidarity among staffs and projects, following institutional guidelines andpolicies and creating synergies needs to be managed carefully and gradually. In order to reachfor an effective management of change and compromise, staff requirements need to beadapted for CSPM and staff capacity needs to be redeveloped.

It is also important that SDC and Helvetas headquarters support the strategic direction of theproject. SDC and Helvetas management in Kathmandu have already agreed to do so duringmeetings in Kathmandu on March 3.

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2

Detailed recommendations:Risks management:• Continue close monitoring of space for development• Develop plan for enhanced monitoring by project staff• Enhance staff preparedness to tackle security risks• Enhance communication between stakeholders (TBSSP, SDC, Helvetas)• Harmonize SDC/H security / risks management procedures• Negotiate with Maoists for DDC fund acceptance• Negotiate additional alternative implementation mechanism with ADB/World Bank and also

DOLIDAR.

Policy level:• Negotiate additional alternative implementation mechanism with ADB and World Bank as well

as DOLIDAR• Do not tackle Trail Bridge Strategy as it has just been approved and government is currently

not open to address the conflict issue. However, address the conflict issue strongly in projectimplementation.

Inclusion strategy (social and geographical):• Continuous effort with regard to staff diversity (gender, ethnicity, cast)• Reflect inclusion criteria for other partners.• Substantially strengthen and enlarge new strategy to raise demands in remote communities• Add remoteness as additional selection criteria• Support bridge building in remote areas in exceptions aside official procedures when prioritized

due to synergy effects within the Swiss umbrella in the SDC or Helvetas clusters.

Addressing consequences of armed conflict• More systematic assessment of livelihood situation and define compensation accordingly• Make use of SDC Humanitarian Fund where needed (as a separate intervention )• Integrate a post-bridge skill development strategy.

Working on conflict: Finding entry points for peacebuilding• More systematic analysis of and focus on community building effects• Introduce systematically a dialogue strategy with the Maoists, e.g. using the interest in bridges

for a development dialogue• Go for pilot rehabilitation of one destroyed bridge (with SDC political and financial support).

Conflict Sensitive Project Management (CSPM)• Enhance the visibility of the management commitment with regard to CSPM,• Accept that the sustainability focus can not have the same impact as in a ‘normal’ situation

(see in next chapter); here certain reductions in achievements need to be considered and buildinto the management strategy,

• Strengthen an inclusive staff recruitment and partner selection,• Change TORs for staff to work conflict sensitive;• Increase monitoring and other processes;• Enhance communication and dialogue with Helvetas and SDC.

Annex 6a

1

MERV Example from COOF Kathmandu Frj 28.3.2006

Evolution of the development environment in Nepal: February 1 - March 27, 2006Military operations and general security

The frequency and the intensity of the military confrontations have remained at the highlevels attained during the previous month of January. Maoists tactic has however shifted:less district headquarters were attacked by the insurgents, who concentrated their operationsalong the main highways – especially in the days immediately preceding their disruptionsprogrammes – and on the outskirts of the major cities and town. CPN (M) cadres havecontinued to destroy civil infrastructure and in particular government administrative buildings,mainly during closure time. In the last weeks, Maoists placed and threw bombs inKathmandu metropolitan area – that had been left almost unscathed for a year after the coupof February 1, 2005. The Security Forces have remained largely passive. The armed policeand police have been the main target of the Maoists and has lost scores of men inseparated incidents. The Royal Nepalese Army has remained entrenched as often and aslong as possible, showing reluctance to intervene and to clear up the road-blocks even daysafter the end of the blockade that brought the long distance traffic to a total halt during sixdays blockade (March 16 to March 20). Only the Rangers, the elite troop of the RNA, daredfrom time to time to look for an open confrontation with the “People’s Liberation Army” andinflicted serious losses to the Maoists in battle.More recently, helicopters have beendeployed to attack assembled Maoists, with devastating effects for the civilian population. Asa result of these violent activities a total of approximately 200 combatants of both sides losttheir lives in the last 2 months. Civilian casualties were in the same order of magnitude.However, violence and deaths have not altered the balance of military power and a militarysolution to the conflict appears as unlikely as ever.

Partial and insufficient movements toward negotiations

On March 13 the seven political parties of the democratic alliance issued a statement thatconfirmed their intention to remain in dialogue with the Communist Party of Nepal (Maoist), toaccept the elections to a constitutional assembly as the main mean to solve the military,political and constitutional crisis as well as to defy by pacific means the king’s autocratic rule.In a parallel declaration, the CPN (M) confirmed its commitment to a multiparty democracyand its acceptance of the eventual results of the elections to a constituent assembly. It alsorenounced to an indefinite national strike, that should have started on April 4, leaving to thedemocratic parties the opportunity and the burden to launch a programme of pacific protestsand demonstrations ( including a 4 days long, nation wide general strike) in favour ofdemocracy and peace, starting April 6. These statements put an end to the erosion processof the political understanding reached last December by the democratic parties and the CPN(M), though the end of this imperfect compact had been actively pursued by the government,with the eager and open support of the American diplomacy. Therefore two of the three mainpolitical protagonists of the Nepali conflict are now again aligned along a common road mapfor the solution of the crisis, while the third pole – the Palace – continues to ignore withcontempt these developments and persists in pursuing, de facto, the military solution or atleast a tentative tactic of military weakening of the Maoists party and the political weakeningof the democratic forces as the way toward security and stability. The stringent and repeatedappeals of friendly countries and international organisations in favour of a partial or totaldialogue, i.e. a dialogue limited to the “constitutional forces” or including the CPN (M), havebeen ignored or dismissed by the government. Even the recognizable shift of the Chineseposition in favour of the democratic and major political parties, the confirmation of the Indian-American position if favour of a dialogue and against a military solution, the hardening of theBritish and EU position toward the Palace or the insistent offers of facilitation presented byFinland, Norway and Switzerland have not moved the king to alter the course he chose in thespring of 2005 and that he seems to be willing to pursue, if necessary, until the (his?) bitterend.

Annex 6a

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Political polarisation

The municipal elections of February 8 which was boyotted by all major policitcal parties,attended by approximately 20 % of the registered citizens, did not bring any clarity to thepolitical debate nor did they contribute to the solution of the political crisis. The government,thank to strong preventive repressive measures, was able to hold the elections without majordisturbances and without hindering in a substantial way the freedom of the media to reporton the event. In approximately a fifth of the municipalities, the attendance was above 50 %and therefore satisfactory. On the other hand, the participation to the polls in the Kathmanduvalley – where fear of reprisal by the Maoists played only a minor role - was verydisappointing for the regime and showed the political isolation of the king among the bestinformed public opinion. Moreover, across the country, the majority of the local executiveseats were occupied without contest, often by people of doubtful reputation and competence.The political parties could therefore celebrate a political victory and pretend – on shakyground – that they still enjoy popular support. They also saw that a political alliance with theCPN (M) is accepted by the population at large, especially if it leads to a cease-fire or at leastto a reduction of the civil violence. Candidly or not, each party to the conflict interpretedtherefore the results of the polls as an invitation to stay the course – and to prepare for newconfrontations. The royalist government, in which the Home Minister Kamel Thapa hasassumed extreme positions, willingly becoming a possible scapegoat for the king if the latterwanted to moderate his stance, seems determined to organise national parliamentaryelections in a year time, in order to legitimize its power and eventually modify the constitutionin favour of monarchic power. The democratic parties will try to bring the king’s regime to fallthrough a pacific movement of mass demonstration and civil disobedience, in line with theMaoist wishes. They will continue their dialogue with the CPN (M) and they will try to includethe insurgents in a political process leading to the election of a constituent assembly thatwould certainly discuss (only?) the republican option – the role attributed in this process tothe Parliament dissolved in 2002 being the major point of dissent between the oppositionforces. Regime and opposition are now bracing for a partial show down at the beginning ofApril: the democratic forces intend to conduct a general strike of few days, culminating inmass demonstration for peace and the restoration of democracy across the country. Thegovernment is likely to respond to this challenge through the usual repressive measures: pre-emptive arrests of leaders and activists, brutal police interventions against peacefuldemonstrators and possibly the selective introduction of curfews. This scenario can unfoldwithout drama as it happened many times in the past, but bears with it a real risk of violentescalation, widespread violence and uncertain outcomes.

External shocks weaken the economy further

An unusually long winter drought, interrupted only mid March by irregular rainfalls, generatedadditional difficulties to the country economy and has affected negatively the living conditionsof many households. Winter staple crops were delayed or lost in many hills districts. Thehydro-power production capacity has been reduced by the low level of water in thecatchments areas, forcing the Nepal Electric Authority to introduce nationwide daily 5 hoursload shredding. Service and industrial productions have obviously been touched by thisrationing measures. In the first quarter of the year, tourism was hit by the resumption of thehostilities and by the images of violence in the Kathmandu streets disseminated across theworld at the time of the municipal elections. Four days of national strike, three days ofcurfews and six days of blockades of long term transport have reduced output andproductivity, imposing additional costs to all segments of the economy. Not surprisinglytherefore the public revenues collection has fallen short of target and is likely to produce ahigher budget deficit as expected, despite low levels of capital expenditures and publicinvestment. The government has tried to respond to the challenge, introducing some marketfriendly reforms that please the international financial institution: liberalisation of the marketfor petroleum related products, adjustment of all fuel prices to bring them almost in line withthe world price, revision of the labour code favourable to the employers, new ordinance

Annex 6a

3

regulating procurements by the public sector, reduction of import tariffs for a large spectrumof consumption and production goods, efforts to improve the collection of VAT. Thesemeasures, that show a certain determination and courage by Mr. Jyoti, appointed financeminister in November, are however unlikely to have much positive effects as long as privateinvestments are constraint by lack of security and by the uncertain political perspectives. Inthis context, the powerful neighbours sent diverging messages: China exonerated fromimport taxes 500 items of potential Nepalese origin, while India – by far a more importantmarket – introduced a 4% tax on goods exported by Nepal and did not formally renew theexisting trade agreement, that was just reconducted by three months (until April 5). The onlybright spot in a relatively bleak scenario has remained the sustained increase of migrationand remittances, the number of young Nepali leaving the country and earning a living abroadfor themselves and for their families recording a 40 % growth over the last 7 months.Approximately 20 % of the brutto national income is now generated in foreign countries.

Development space still under pressure; aid commitments decline

The public acceptance of the Basic Operating Guidelines by the CPN (M) leader Prachandaand the rapprochement to the democratic political parties through the 12 points document ofunderstanding have not enlarged so far the space for development work. On the contrary,high levels of uncertainty and inconsistency remain, especially in the centre and easternregions of the country, where SDC focuses its interventions. Request for registration anddonations have continued to plague the discussions conducted in the field with therepresentative of the Maoist party and have delayed or hindered work where thesediscussions were not conclusive and could not nurture sufficient trust in the behaviour of theinsurgents. Official agencies, which are in the position to communicate with the MBleadership through the BOGs group and the UN system, were often able to settle problemsarisen at the local level. Local Ngos and service providers, instead, have been subject toeven harder pressure to formally register and financially contribute to the “people’s war”. Inany case, all development actors, official and private, are now requested to intensify theircollaboration with the administrative structures of the “new state” and to better coordinatewith the latter their interventions. Many agencies, including SDC, accept to do so in thecontext of their contribution to conflict transformation, as long as the basic operatingguidelines are respected and the pragmatic collaboration with the government and the localauthorities, that often provide substantial financial contribution to the building of localinfrastructure, is not fundamentally questioned. Overall, the general climate of uncertaintiesand the weak governance ensured by the regime are eroding the donors’ goodwill towardNepal. Disbursements corresponding to bilateral and multilateral committements entered intobefore February 1, 2005 have maintained foreign aid more or less at the level of the previousyears, but the volume of new committement has been shrinking and will arguably affect thebudget hard in the next two fiscal years. Asian Development Bank has not entered any newcommittements for 15 months (although the country program indicated a lending / grantenvelope of approximately 115 millions dollars per year); Dfid had to reduce its budget from32 to 27 millions british pounds and USAID from 42 to 32 millions dollars (these figures areconfidential and not officially confirmed), while Germany, Denmark and Norway, whichprovide their assistance in the framework of bilateral program agreements, have not heldofficial consultation with government for the last 18 months. Australia is discontinuing itsbilateral program. A recent critical assessment of the fiduciary risks involved in providing aidthrough the budget and the results of coordinated visits by the main bilateral donors todifferent rural districts in order to asses the progresses of decentralisation are also likely toquestion and / or delay new committements. Only the World Bank, although it has beenunable to provide budgetary support for the last two fiscal years, seems to ignore the writingson the walls and plans new committements as it were.

Relations between His Majesty’s Government and SDC

Beginning of March the Minister of Finance was quoted in a local weekly magazine criticisingSDC and Dfid for establishing a joint Rights, Inclusion and Democracy Fund. This plausible

Annex 6a

4

negative reaction was never officially confirmed or communicated and did not affect at all thepragmatic collaboration of our agency with the line ministries or with the local authorities. Onthe contrary, SDC has been actively involved in the resumption of an open (and difficult)dialogue between donors and government, while extending through bilateral agreements itscooperation in important areas (the Vertical Shaft Brick Kiln Project, the Rural HealthDevelopment Project, the provision of technical assistance for the bridges buildingcomponent of the World Bank financed Rural Infrastructure project). The Minister of LocalDevelopment approved the Suspension Bridges Strategy, a normative document thatsummarizes the results of decades of intensive collaboration between SDC, Helvetas, thegovernment of Nepal and local communities. Finally, to our surprise, the DistrictDevelopment Committee of Ramechap discerned to SDC the annual prize for “the bestorganisation operating in the district”, after being fully informed, as the official partners of theother districts where SDC and Helvetas work, about the results of the clustering workshopsand the activities planned by the different projects in each specific area,Consequences for SDC:

a) The general situation will remain tense and unpredictable over the next months. Wewill be ready to face a further deterioration of security and an increased level ofviolence especially at the beginning of April, when the protest program prepared bythe political parties and supported by the CPN (M) should attain its climax. A generalradicalisation of the conflict is possible also beyond those dates.

b) SDC personnel and partners will be exposed to additional risks, especially whentravelling or when approaching, for professional reasons, administrative building andpolice stations. Training of staff – with special emphasis on new comers that have justjoined SDC and related projects – and specific instructions elaborated in coordinationwith the UN and with Dfid / Gtz Risk Management Office will reduce the exposure topossible incidents and dangers.

c) SDC will protect the space for development and continue to demand the respect ofthe Basic Operating Guidelines (BOGs) by the insurgents. It will engage in discussionwith the insurgents at the program level when necessary, to protect the safety of ourstaff and advocate for the integrity of our programs. This will be done in co-ordinationwith the other agencies that have subscribed to the BOGs and we keep in contactwith the UN representatives who advocate the same cause at the central level. Jointlywith other agencies, we will again engage the central Government on this issue andwe will continue with the dissemination of the Bogs principles in rural districts.

d) SDC will consider, discuss and implement the recommendations presented by Ms.Thania Paffenholz in her recent report on the conflict sensitivity of the Swissprogramme management. SDC Headquarters and PD IV will be associated to thiseffort.

e) The protection of Human Rights will remain a central concern of our engagement.Coof will accompany and support from Nepal the organisation in Geneva, by PD IV,of a public human rights event on Nepal. Local media will be promptly and objectivelyinformed. It is also foreseen to organise in Kathmandu a public presentation of thenewly created United Nations Human Rights Council and of its relevance for Nepal.

f) The World Bank will prepare in the next months a review of its Country AssistanceStrategy for Nepal, to be tentatively presented to the Board in July 2006. Coof willfollow closely this important discussion, coordinate the Swiss position with likeminded countries present in Kathmandu and ensure that the multilateral services ofSDC and the Executive Director in Washington are well informed and can defend acredible and well articulated position in the Board as well as in other exchanges withthe World Bank higher management.

Annex 6b

1

Evolution of the development environment: 02.02.06 – 27.03.06

Domain Remark Trend

1. Characteristics of theopen conflict

Intensity of militaryoperations

Violent attacks continue despite “hopeful” interviews.

More Maobadi activities in the Central and Eastern Regionof the Country along the highways.

Most of the attacks are in the urban areas. Maoist areusing vehicles to attack.

Low and delayed presence at the site of incidence e.g.Dolakha and Urlabani incidents.

Rangers (Security Forces - SF) were able to attackMaobadis during a gathering event. More than 20Maobadis were killed (adjoining Dhading).

Geographical distribution More Improvise Explosive Devise (IED) explosions inKathmandu since many months e.g. at King MahendraTrust for Nature Conservation – KMTNC (Crown PrinceParas is the Chairperson of this organisation) andAssistant Minister (Toran B. Gurung) etc.

Clash attacks more closer to East from West and closer toKathmandu Peripheri. There are more day time clashesand attacks on security forces and police.

Maoist attacks on security personnel and security postsincreased.

There was bomb explosion on market in Pokhara.

Two ‘vigilante’ members were killed in Nawalparasi – adistrict where SF promoted ‘vigilante’.

Military victims More than 200 from both sides (Maoist and SF) were killeddue to the violent activities.

Civilian victims Incidence of violation from military side were increased.

The staff of National Human Rights Commission (NHRC)were attacked in Janakpur.

More Civilians were killed by SF either accident orindiscriminate shooting. Casualty within one week were 66and 11 Civilian casualties were reported.

Maobadis abduct ? Esperanto trekkers from the areaabove Jiri --> Solukhumbu since a week?

Destruction of infrastructure Bridge in Tanahu blasted restricting traffic.

Atrocities Maobadis killed a taxi driver who drove during Bandh.

Annex 6b

2

Economic pressures 6 days of blockade were called successful.

Security check point control of vehicle movement (before 6a.m. and after 6 p.m.) causes loss of market opportunity tofarmers in Chapagaon.

Social pressure

External interventions Russian military mission?

2. Possible resumption ofthe peace process

Technical preconditions Renewed offer by His Majesty’s Government of Nepal(HMG/N) for surrender of weapons and Maobadis.

Political commitment Political parties “forced” to “join closer” to the Maobadis.

There were no indication of peace process from theGovernment and the King.

Confirmation of 7 Parties alliance and CPN (M) to “get rid”of autocracy.

The Government becoming more aggressive towardsMaobadis – 7 Parties deal.

The Government (Home Minister – Kamal Thapa) blamedthat the 7 Party protest program is also the program ofMaobadis.

CPN (M) willing to go for ceasefire if 7 Parties agree forcommon agenda + action plan -> constituent assembly.

Maoist intensify sporadic attacks and explosions whenevercivil society, parties tend to gain some momentum – thishelps Government to employ regression.

12 point (understanding) reached into New Phase andwhich is welcomed by Civil Society.

Substance of talks

Participation of civil society General public more and more frustrated by the behaviourof Political Party Leaders who seem to be aimless.

Professional organisation agreed to support politicalmovement of 7 Parties.

External interventions George Bush and the Indian Prime Minister (Man MohanSingh) asked King to reach out to the political parties –seems to have no effect on the King.

Isolation of King and his Government continues; only oneinternational platform - Rhino handover in Austria.

Understanding among a number of European nations tojointly support talks on talks and talks.

Visit of US – Donald Camp – no visible impact on King +Parties.

Sher Bahadur Deuba’s visit to USA: does it meananything?

Visible Swiss face (Günther Baechler) in favour of political“middle ground”.

Swiss offer for peace talks.

Annex 6b

3

Statement were made by US Ambassador on the 12Points.

Strong message of US Ambassador for “constitutional”forces to get united.

British position gets harder.

US + India + China call for constitutional and King workingtogether.

Norwegian offer for mediation and the Finnish also startsprocess to offer mediation.

Palace not ready to talk to the UK MP delegation.

Chinese State Councellor’s visit: constitutional forces tostart dialogue.

China’s position believed to be clearer. Joins Internationalgroup suggesting for solution through cooperation ofconstitutional power.

India is still not clear on Nepal issue (MB + 7 Parties inIndia – asking constrant force to work with King).

UN (Gautam) calls 7 Parties to call UN for support inresolving crises.

Warring faction supported bythird party (ideally UN)restart negotiation

3. Environment fordevelopment activities

Behaviour of the Securityforces

Royal Nepalese Army (RNA) + police make statement onHuman Rights actions taken, disappearances.

Behaviour of CDO and thepolice and other localauthorities

Chief District Officer (CDO) of Doti asked Helvetas to justifyabout their field activities and possible contacts withMaobadis.

The Government is not prepared and ready to see donorssupporting political parties and democracy.

Maobadis allowed to work in Bajhang after 3 years closure.

Maobadis leadership responds in writing to Basic OperatingGuidelines (BOGs) group.

Autonomy and authority of Community Forestry UserGroups (CFUGs) threatened by both State + Maobadis(exists!).

More Maoist leaders are visible with media + 7 Party localleaders in Dolakha, Sindhupalchowk.

Maoists Behaviour Prachnada expels 2 Central Committee members whocriticised Prachnada and Baburam Bhattarai.

Despite respect for BOGs by Maobadis, pressure fordonation still exists.

Maobadis continure to ask for donation, support and wartax with development partners in many parts of the Country.

There is unclear situation of projects with strong DistrictDevelopment Committee’s (DDCs) contribution.

Annex 6b

4

Non-Government Organisations (NGOs) allowed to work inHumla.

Criminality Crime (murder, robbery etc.) by security personnelincreased.

Risks of being victims ofmilitary operations

Looting of public buses on highways increases.

Being caught at wrong place wrong time increases verymuch as more day time attacks occur.

People behaviour The bankers association issued the statement that theycan’t give donation to anyone (pressure from Maoist).

Reactions by theinternational community

Asian Development Bank (ADB) and the World Bank (WB)more conscious regarding development space.

Relation between SDC andGovernment

The higher level Government officials understand andappreciate role played by SDC in creating/improving spacefor development.

The two bi-lateral agreements (Rural Health DevelopmentProject and Vertical Shaft Brick Kiln project) is signedbetween the Government of Switzerland and His Majesty’sGovernment of Nepal.

Trail Bridge strategy 2006 endorsed !

There is ammendment of Trail Bridge Sub-Sector Project(TBSSP) bi-lateral agreement for Technical Assistancesupport to WB funded project.

There is recognition of SDC’s effort in Ramechhap byDistrict Development Committee (DDC).

The Government requests SDC repeatedly to re-engagethe commitment in TVET (Technical Vocational EducationTraining) Sub-sector. There is strong new commitment fromthe Ministry of Education.

4. Political institutions

The King King still in a holiday mood.

Step by step, the King implements his plan according to theRoyal Proclamation.

The meeting was called by the King with ZonalAdministrators.

NRs. 60 million for Paras (Crown Prince) visit to Austria (tobe paid through development budget ?).

The Royal Nepali Army RNA has accumulated huge sum of fund and looking forbetter investment opportunities.

SF request additional funds as defence budget is “as usualovershot”.

Representativeness andauthority of government

Less than 20 % turnover in local polls indicate its failure.

Through the Home Minister (K. Thapa), HMG/N becomesmore assertive and aggressive.

Civil service reform Still there is no clear guidelines for the implementation ofnew Civil Service Act which was revised months ago.

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Decentralisation Decentralisation de facto stopped: one country, twosystems.

Health Sector reforms for decentralisation/devolutionquestioned due to lack of conceptual clarity (may end inmess).

Ordinance on put of national parks – doubtful - a ploy tostrengthen KMTNC ?

Activities of the mainnational commissions

The Supreme Court (SC) verdict that RCCC (RoadConstruction Coordination Committee) is unconstitutional.

Formation of women’s commission – diversity inrepresentation.

Fairly representative women’s commission formed andthere is no hill Janajati representative.

5. Civil Society

Voices Civil Society leaders and Human Rights defenders still indetension.

Ordinance of Labour Management is out and there hasbeen protest going on by unions.

Public awareness

Participation in politicaldecision making

Talks on the unification of two congress parties.

Role of Media Visit of international media mission – 8 day study on theNepali situation.

6. Decisions/eventsaffecting the economy

Exogenous shocks Poultry industry mainly in Terai hit hard due to bird fluescare.

No rain. Very little rain will effect agriculture production.

Remittances, tourism falters.

Economic Policies Five hours load-shedding effecting overall economy,development.

China officially agreed to exempt number of Nepali productfrom import tax.

The Government has increased fuel price in February(diesel: 15%; kerosene: 22%). The transport fare increasedby 25% - 28%.

The Transit Treaty between Nepal and India is expiring on5th April 06.

For Agriculture / forestry Operational plan of CFUGs not renewed and some bankaccounts closed down by the Government.

Attack on milk carrying vehicles during blockade.

Famine in Bajura:

• No functional food corporation.

• Affected wild food due to drought.

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For the informal sectorFor industry and services Indian budget affected trade with India (countervailing

duty). 3% duty imposed on Nepali product.

Trade and migration Foreign employment increased by around 40%.

Around 365 people are flying to overseas for employmenteveryday (during last month).

Budget and public finances Negative fiduciary risks assessment.

7. Individual and socialrights

Reported human rightsabuses

RNA had beaten the whole community in Kailali asMaobadis killed one RNA personnel.

Ex CoP Bagale is victimised because he wanted to be awhistle blower.

Measures taken in defenceof human rights

OHCHR (Office of the High Commissioner for HumanRights) second major report to the United NationsCommission on Human Rights is published.

Amnesty International with other right organisations havebeen trying to sanction the participation of RNA in UNpeace keeping mission.

Human Rights Commission will replace the UNCommission on HR.

National Human Rights Commission gains prestige andreputation.

Rights of discriminatedgroupsGender Balance

Refugees US speaks for refugees (Bhutanes + Tibetan) and offersfinancial support.

Freedom of expression 2nd mission of an alliance of media I/NGOs successfullycame to Nepal

Individual security andproperty rights

8. Delivery of basic socialservices

Health services

Primary and secondaryeducation

There is closure of schools and use of schools by Maobadisare increasing.

There is number of students being sent Abroad + India foreducation which is increasing highly.

Inclusive measures forvulnerable groups

Dalits stopped from water source and beaten-up in Lalitpurbut after the intervention from the authorities it is allowedagain.

Deterioration of rule of law There is political manipulation of the SC by the palace.

Annex 6c

Main trends in Nepal

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Intensity of conflictPeace processSpace for dev. WorkPolitical institutionsCivil SocietyEconomyIndiividual rightsSocial services