Just as the tourist industry in Pokhara was gearing up for the new season that begins next week, the news dawned that most of the town's lakeside properties face imminent demolition.

The process has already begun. As one enters Pokhara, it is impossible to avoid seeing partially destroyed buildings. These are not battle scars from the years of conflict but the result of peacetime Maoist activists. Not even the stadium wall has been spared.

A law here bans any private construction within 65m of Phewa Lake, but like many laws in Nepal, it has never been enforced. Now the Ministry of Local Development, under Maoist control, is setting out to make amends.

The Maoists' youth wing, YCL, is leading the assault on the encroachers, supported by the Pokhara Valley Building Department which is also led by a Maoist appointee.

But many fear such wholesale demolition will have a disastrous impact on the tourist trade, leaving few hotels and restaurants unaffected.

"It will spell disaster not just for the owners but for a lot of people like me who depend on tourism for their livelihood," says Krishna Rana, a taxi driver in Pokhara's Lakeside neighbourhood.

JOHN NARAYAN PARAJULI

But YCL activists claim they are looking at the bigger picture. They admit there might be short-term setbacks but argue that in the long run it will benefit the town.

"We want to unmask the land mafias who have been illegally occupying a national treasure," says the YCL's Pokhara deputy, Suman Devkota. "If we manage to get Phewa on the world heritage list, there will be more tourists coming."

Many property owners we approached seemed reluctant to talk, but were clearly worried that the demolition might go ahead. They mounted a sit-down protest and have asked the eight parties and the District Development Committee (DDC) to reduce the width of the banned construction zone to less than 65m. The DDC upheld the existing law, but ordered the concerned agencies not to demolish the structures immediately.

For now the business community is sitting tight. The eight-party representatives in the district have asked the local building department to come up with a plan to compensate the owners before enforcing the regulation.

Even the YCL says it will respect the decision of the eight parties. Nevertheless, there is fear among those in the tourist trade that the young activists will be up in arms again, sooner rather than later.