Oct. 8 (Bloomberg) -- Nepal's government tried to salvage the Himalayan nation's parliamentary elections, after political deadlock over rebel demands for a republic prompted it to delay the Nov. 22 ballot, a minister said.

Prime Minister Girija Prasad Koirala held talks yesterday with Puspa Kamal Dahal, leader of the rebel Communist Party of Nepal (Maoist), and will hold talks again within the next two days to find a compromise before Parliament meets Oct. 11 to discuss the crisis, Ram Chandra Poudel, minister for peace and reconstruction, said in a telephone interview from Kathmandu.

The Maoists quit the Cabinet last month and threatened street protests after the coalition government rejected their demands for Parliament to immediately declare a republic and introduce a proportional representation voting system.

United Nations Secretary-General Ban Ki-moon last week urged Nepal's political parties to resolve their differences and hold the ballot as soon as possible.

``Negotiations are on,'' Poudel said. ``The focus is on how to hold the assembly elections. The appropriate date we think will be mid-April.''

The election is for a National Assembly that will write a new constitution for the nation and decide the fate of the monarchy, currently headed by King Gyanendra.

The vote was scheduled under a November 2006 peace agreement, which saw the Maoists end their armed struggle for a republic, return 30,000 fighters to camps under UN supervision and join the interim government.

`Desire for Peace'

``The people of Nepal have demonstrated their desire for peace and the stakes are too high to allow manageable differences to deny their aspirations,'' Ban said Oct. 5 in a statement.

The Maoists, who follow the ideology of China's former leader Mao Zedong, say a republic must be declared immediately because supporters of the monarchy could undermine the vote.

Koirala says the new parliament must vote on the issue for the change to have popular legitimacy.

On Oct. 11 the parliament session will take up the Communist Party of Nepal (Maoist) resolution which has called for dissolving the monarchy before the elections and a proportional vote system, minister Poudel said. ``This will have to be settled first. We are not in favor of a referendum to decide on dissolving the monarchy. Neither are they.''

The Maoists and Koirala are to blame for the election being delayed, said the Communist Party of Nepal (Unified Marxist- Leninist), which is a member of the coalition government, Nepalnews.com reported.

Resignation Calls

The ``historic'' opportunity of holding the vote ``has been lost due to the Maoists' policy and actions to evade and disrupt polls and Koirala's stubbornness,'' the party said in a resolution, according to the report. Some party members called on Koirala to resign, Nepalnews.com said.

Gyanendra became king in 2001 after his brother, King Birendra, and most family members were shot dead in a domestic dispute. He dismissed the government in February 2005 for failing to end the Maoist insurgency and ruled as an autocratic monarch for 14 months.

Gyanendra was forced to restore parliament in April 2006 in the face of mass demonstrations and has since been stripped of much of his power. He is no longer head of the army and his income and assets are taxable under a resolution passed unanimously by lawmakers in May 2006 that turned Nepal, once the world's only Hindu kingdom, into a secular state.

Located between India and China, Nepal is one of the poorest countries in the world, where about 40 percent of the population lives below the poverty line.

The country is home to Mount Everest, the world's tallest peak, which attracts climbers from around the globe. More than 13,000 people were killed in the civil war, which damaged the tourism-dependent economy.

To contact the reporters on this story: Michael Heath in Sydney at mheath1@bloomberg.net; Jay Shankar in Bangalore at jshankar1@bloomberg.net

Last Updated: October 8, 2007 05:11 EDT