From his perch atop a stool in his dry goods shop, Yog Prasad Bhattarai sees much that happens in the village of Awikbhanjyang, just off the Siddhartha Highway to Pokhara. The numbers of people moving up the road that curves past his shop have grown in the past three weeks after the ceasefire announcement. But there is no increase in the number of customers in the his shop.

"Business is down, there's been no change," he tells visitors wearily.

Such response is typical from the residents of Tansen when asked about the ceasefire. "We're happy", "it's good news" or "I can move easily" people say but there is always a but: "But the government should also agree to the ceasefire."

Palpa's beauty is breathtaking even with the Annapurnas shrouded in monsoon clouds. Terraces of emerald paddy and lush forests shine in the sun. On the path to Buddhikot, villagers shield themselves with umbrellas as they hurry their livestock along rocky, rutted roads and trails. At the local school, headmaster Jaganath Sharma sits on a straw mat under a pipal tree.

The area has been little disturbed by the conflict because it's not on a main rebel route. But some months ago some soldiers disguised as Maoists entered one end of the village while two rebels on a motorcycle rode in at the other. After the shooting stopped, one Maoist was dead while the other was wounded and escaped.

"After the ceasefire things like that haven't happened," says the headmaster. "People are hoping that if both sides drop their guns there will be peace."

Further down the trail, past plots of yellowing corn, a local NGO worker says things are more relaxed. "I can go anywhere now," she says, "Before I used to have many problems." Earlier this year in eastern Palpa about 5,000 Maoists had gathered at a school where she was supposed to train locals. "They interrogated me about our training, why we were doing it, what its benefits would be, who was being paid what. Finally they said OK, you can go ahead," she recalls.

On 23 March three secondary students stopping cars for donations during Holi were shot by soldiers who claimed they were Maoists extorting taxes.

Generally, Maoists act respectfully when they're on duty, they pay the fare and don't ask for special treatment, says a young jeep driver on the road from Tansen to Chidipani. As for soldiers: "I have never been harassed by them but I know they have beaten drivers who were forced to give rides to Maoists."

At one time Tansen used to be bustling with tourists, there are none to be seen now. The local restaurant is almost empty. Tourist arrivals have dropped from 3,700 in 1998 to around 500 last year, says a local businessman. The only businesses that are thriving are those linked to the overseas workforce: money transfers and international phone call centres.

The local bank has also left and the police post has relocated. Yog Prasad says he will be next if peace does not return soon. Where will he go after 28 years? "Home to the tarai to farm," he says with a shrug, "where else?"

The Maoists have worked in 'pocket areas' and had kidnapped some people. On one occasion the Red Cross walked for five days to take back prisoners captured by the Maoists. But when the military captures people, half of them don't come out alive, says one local.

Maoists would occasionally demand food. Soldiers would come after that and say, "if you had not fed them they wouldn't be here".