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Last Updated: Sunday, 21 May 2006, 00:05 GMT 01:05 UK
Nepal companies face Maoist 'tax'
By Charles Haviland
BBC News, Kathmandu

A Maoist rebel
Companies say Maoist trade unionists have demanded a 'tax'
Dozens of companies in southern Nepal have suspended operations saying they cannot cope with acts of financial extortion by Maoist rebels.

The Maoists appear to be stepping up a campaign of forced donations despite their declaration of a three-month ceasefire in the decade-long conflict.

Reports say Dabur Nepal, one of the country's biggest companies, has had demands from Maoist trade unionists.

The rebels' trade union branch has denied demanding any money.

During their earlier ceasefires the Maoists have had a track record of continuing extortion and even recruitment to their ranks.

Now, nearly a month into the new ceasefire, the trend seems to be continuing.

'Donations' necessary

Reports say Maoist trade unionists have demanded a tax equivalent of more than $1m from one of the largest joint venture businesses in the country, Dabur Nepal.

Maoist leader Prachanda
Prachanda says 'donations' are necessary to sustain the insurgency

The consumer goods business, which is partly Indian-owned, says Maoists also entered its factory and forced workers to attend a mass meeting for several hours.

A local industrialist said Maoists put forward more than 20 demands to employers on matters such as job security and immediately started threatening physical action against them if they did not comply.

The trade union wing of the rebels have denied these allegations.

But earlier this week the Maoist chief, Prachanda, said that what he called 'donations' were necessary to feed and look after the Maoist army.

The new multi-party government has started announcing its team for proposed peace talks but the deputy prime minister has accused the Maoists of jeopardising peace through what he called extortion, intimidation and recruitment to their militia. On Thursday, parliament adopted a historic resolution completely removing King Gyanendra's powers and bringing in many changes which are in line with Maoist thinking.

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