Maoist leader Prachanda tried to put on a brave face after the detention of his comrade and ideological guru, Mohan Baidya, by Indian police in Siliguri on 29 March. He said Comrade Kiran's arrest was the result of collusion between the rulers in Kathmandu and New Delhi over sharing rivers and natural resources. He did not give us the gory details of exactly what he meant.

Even while they were reveling in the military victories in Bhojpur, Beni and Pashupatinagar, the Maoists were at the receiving end of a major counterblow with the loss of a senior leader and important documents in the underground office of their eastern command. Comrade Kiran's arrest has thrown up a lot of challenges for the Maoist movement. India has now sent the message: 'We can catch you if we want' and it has also shown that the Maoists are not outside the Indian security net.

The Maoists' relations with India have always been enigmatic. Nine years ago, when they started their 'People's War', India was enemy number one. They launched a campaign against Indian movies and stopped vehicles with Indian license plates. But for eight years after that, they didn't harm any Indian-owned industry, businesses and personalities. Cadres of the Sadbhabana Party, which the Maoists used to call 'pro-Indian' were never harmed. In fact, the Maoists themselves earned the reputation of being pro-Indian, and New Delhi derived economic and strategic benefits from Maoist policies and activities.

Much more than the United States, it was the Indian military that was propping up the Royal Nepali Army with training and hardware all along. Yet, paradoxically, it was 'American imperialism' that the Maoists consistently slandered. In 1996, when they launched their armed struggle, the Maoists said with characteristic rhetorical flourish: "The main enemy of the people's war is the domestic capitalist-royalist class which is backed by Indian expansionists." In the next eight years, the "Indian expansionist" part of that sentence vanished.

Now, New Delhi is making up for having ignored or tolerated Nepali Maoists. The recent arrests and extraditions of senior Maoist figures and the declaration of the Maoist-affiliated All-India Nepali Solidarity Society a terrorist outfit indicates that there is now convergence between the policies of the United States, India and King Gyanendra vis-?-vis the Nepali Maoists. It also proves that the Maoist strategy of stoking Indian fears of US geopolitical ambitions in the region has not worked.

The Maoist response to all this was to use Indian territory to launch the attack on the Nepali border town of Pashupatinagar on 7 April. They set fire to 18 Indian-registered gas tankers in Dhangadi, shot and injured the driver and helper of an Indian lorry, and warned cinemas not to show Indian movies in Nepalganj.

After a strong warning from the Indian Embassy in Kathmandu, Maoist spokesman Krishna Bahadur Mahara clarified that the attacks were "emotional outbursts" and not official party policy. The Maoist leadership seems still wary of stirring up Indian wrath. Meanwhile, Indian deputy prime minister Lal Krishna Advani equated the threat from Nepali Maoists with that posed by India's own People's War Group and MCC during his election campaign last week. If Advani's statement is official policy, it looks like Nepali Maoists are running out of options. In fact they have only two alternatives: join the mainstream political agitation or initiate dialogue with the king.

After last year's ceasefire broke down, the Maoists have rejected any negotiation with King Gyanendra. It is unlikely that they now want a negotiated settlement, especially because they think they are winning. The government understood this and is trying to respond with increased military pressure. But Mohan Baidya's arrest in Indian may have changed the scenario and makes a King-Maoist rapprochement more probable.

The Maoists are fighting an increasingly unpopular war in the name of the people. Villagers fed up with Maoist atrocities rose up and killed seven Maoists in Kanchanpur this week. The rebels are also paying the price of public outrage with their frequent and widespread 'blockade war'. It also ridiculous for a group that boasts about raising a 50,000 strong child militia to ask for UN mediation.

It is now time for the Maoists to transform their people's war into a peaceful people's movement and join the mainstream pro-democracy agitation. Otherwise not only will victory elude the Maoists but this may also be the beginning of the end.