King Gyanendra''s decision to declare an emergency in Nepal, sack his government and assume direct control has confronted India with the most acute foreign policy dilemma that it has ever faced: to back the King in what is bound to become an all-out conflict with the Maoists, or to back away from him and let Nepal slip out of India''s sphere of influence as he goes looking for new patrons.

New Delhi''s immediate condemnation looked like a knee-jerk defence of the principle of democracy. But it was anything but that. The Indian government had been aware of King Gyanendra''s increasing restiveness, and had been counselling patience for some time. It had therefore had plenty of time to decide what it would do if he took the bit between his teeth.

The King''s growing frustration was easy to understand. The Maoist insurgency had been going on for nine years. A succession of elected governments had failed both to crush the movement and to bring the Maoists into the political mainstream. A cease fire had been painstakingly negotiated in January 2003, but endless rounds of talks had brought the Maoists no closer to accepting the 1991 constitution.

In the meantime, the strife had disrupted Nepal''s economy, and choked off the revenue from tourism upon which it depended for most of its foreign exchange. The Maoists were using the lull to consolidate their hold on the rural areas of the kingdom. By some estimates they now controlled 75 per cent of the country. The political parties had proved incapable of resolving the problem. The King had therefore acted out of desperation. This was a very different action from that of his father King Mahendra, who had declared an emergency in 1960 mainly because of his personal dislike of the prime minister B.P. Koirala.

If, despite this New Delhi has felt it necessary to express deep concern over the King''s action, to cancel prime minister Manmohan Singh''s visit to Bangladesh at the last minute in order to avoid meeting the King, and prevent the new Army chief, Gen, J J Singh, from receiving the honorary generalship of the Royal Nepal Army, it is because it is utterly convinced that the King has made a terrible mistake.

By eliminating the elected government from the political arena, he has entered into a direct confrontation with the Maoists. Since the prime purpose of the Maoists, ever since they first sought power through elections in 1991, has been to abolish the monarchy, there is now literally no room for compromise. Renewed conflict is therefore around the corner and, given the forbidding terrain of Nepal outside Kathmandu valley, and its relatively small army, it is a conflict that the government cannot win.

King Gyanendra may not be aware of this. Like all his predecessors, he is surrounded by a coterie of sycophants who tell him what he wants to hear. The Royal Nepal Army too is fanatically loyal to the monarchy, and may have given him an exaggerated impression of what it could do if the shackles of civilian control were removed. (This is indeed what the RNA spokesman Brigadier-General Gurung, told the Indian Express on February 4). Finally, he is aware of the deep reverence that ordinary Nepalis feel for the monarch, whom they regard as an incarnation of Vishnu. These considerations seem to have persuaded him that support for the Maoists will melt away if he assumes direct control of the anti-insurgency operations.

Delhi , however, knows from its own bitter experience that most of his optimism is based upon wishful thinking. There were never more than 500 active ''A'' grade terrorists in Punjab, backed by about 2,000 helpers and 5,000 sympathisers. Yet they tied up over 350,000 police, military and paramilitary forces, and unleashed a reign of terror, that claimed more than 50,000 lives over the course of a decade. In the same manner there have never been more than 3,000 active insurgents, or terrorists in Kashmir, but the resulting violence has claimed around 60,000 lives and despite the deployment of 375,000 military and paramilitary personnel, is not yet fully under control.

In Nepal the active Maoist cadres are estimated to exceed 5,000. Even in relatively friendly terrain the government would need half a million soldiers to wrest control of the countryside from them. But in the mountainous terrain of Nepal, where communications are primitive and large stretches have no motorable roads, even such large counter-insurgency forces would not suffice. Against this the entire RNA numbers less than 80,000.

The King''s precipitate action has left India with Hobson''s choice. If it backs the King in a direct conflict with the Maoists, it will find itself embroiled in a low intensity conflict that cannot be won. As the conflict intensifies the stakes for India in the King''s victory will rise, and it will find itself sucked ever deeper into the war. What starts as a supply of sophisticated arms to the RNA could end by sucking Indian troops into the conflict. After the IPKF''s bitter experience in Sri Lanka, that is the last thing India wants.

What is worse, the main victims of the violence will not be the cadres of the Maoists or the soldiers of the RNA but defenceless villagers. While the Maoists will terrorise them to create safe havens for themselves, the RNA will terrorise the same villagers to dissuade them from giving sanctuary to the Maoists or to punish them when they do. If the violence is prolonged, it will provoke a large exodus into India. In the end the failure to crush the Maoists will embolden India''s home grown Naxals. These have already spread their tentacles to 157 districts, or about a quarter of the country, but so far lack the popular support to pose a serious threat to the state.

The alternative, to deny support to the King, and refuse his request for arms, is fraught with risks of another kind. Under a 1965 agreement, Nepal has the right to procure weapons from other countries if New Delhi cannot, or will not, provide them. The King has sent signals that if his request for arms is turned down, he will turn to the UK, the US, Pakistan and China. The UK and US are as reluctant to get sucked into the Nepali quagmire as India, but New Delhi fears that Pakistan and China may not be able to resist the bait. If either country establishes a permanent military presence in Nepal, India''s northern ramparts will be decisively breached.

New Delhi has temporised by agreeing to send the arms that are already in the pipeline, but deferring a decision on agreements that have not as yet been signed. However, this can at most buy time. The more difficult task is to persuade the King to back away from his impulsive folly and hand back power to an all-party, national government. This will recreate the buffer that existed between the monarchy and the Maoists, and reopen the possibility of finding a compromise solution that brings the latter back into democratic politics, while preserving the monarchy in some form.

New Delhi will find it much easier to persuade the King if it abandons its insistence on bilateralism, and involves the US, the UK, and the EU (and just possibly China and Pakistan) in the search for a solution. Such a multilateral initiative stands a far better chance of persuading the King to restore democracy and concede the Maoist demand for a constituent assembly, while simultaneously reassuring him that it will fully support the preservation of the monarchy. It will also put far greater pressure on the Maoists than Delhi alone can, to accept a compromise in the recasting of the constitution that the King can live with.

* The author, a noted analyst and commentator, is a former editor of the Hindustan Times, The Economic Times and The Financial Express, and a former information adviser to the prime minister of India. He is the author of several books including, The Perilous Road to the Market: The Political Economy of Reform in Russia, India and China, and Kashmir 1947: The Origins of a Dispute, and a regular columnist with several leading publications.