(Updates with fresh toll paragraphs 1, 3 and 4) By Gopal Sharma KATHMANDU, Jan 31 (Reuters) - Nepal's prime minister promised on Wednesday to turn Nepal into a federal state after this year's constituent assembly elections, a move to stem protests by ethnic Madhesi people in which 11 people have died. Prime Minister Girija Prasad Koirala also vowed to redraw constituencies for the planned vote, the first in eight years, on the basis of population and geography to raise the representation of different groups, including the Madhesi people, in the assembly. Hours after his comments, Madhesi protesters clashed with police in Biratnagar, Koirala's home town in southeast Nepal. A police officer and a protester were killed, police said. Protesters ransacked a police post and stole a pistol, two rifles, a police official said. At least two towns remained under curfew on Wednesday as the protests continued to cripple Terai, Nepal's economic and industrial hub which borders India. Protests from Madhesi people, who live in Nepal's fertile southern lowlands, have cast a shadow over the landmark deal in 2006 that declared an end to the decade-old Maoist revolt in which more than 13,000 people were killed. The constituent assembly, a key demand of the former Maoist rebels, is meant to draw up a permanent constitution for the country and map out its political future. "The new constitution to be prepared by the constituent assembly will create a federal democratic system," Koirala, wearing a black Nepali cap and a matching jacket, said in a nationally televised address. The move is seen aimed at ending centuries of central rule and appeasing ethnic groups complaining of government neglect. "We are passing through epoch-making times in the history of our country. Therefore, everyone must contribute to make free, fair and peaceful elections possible," Koirala said. Koirala's comments came nearly two weeks after violent protests across the eastern Terai, also known as Madhesh, in which more than 100 were also injured. INTERIM CONSTITUTION Earlier in January, government and Maoists approved an interim constitution that saw the former rebels start to lock up their arms and join a provisional parliament as part of the peace deal negotiated by Koirala and Maoist chief Prachanda. But many, including the ethnic people of the Terai region, said the new constitution had failed to give them adequate representation in parliament. Madhesi activists say they have faced discrimination by the "hill-dominated" ruling elites who run the Himalayan nation, resulting in under-representation in parliament, government, army and police. Despite making up nearly 30 percent of Nepal's 26 million people, Madhesis, who are ethnically and linguistically closer to neighbouring India than to the Nepalis living in the hills, occupy only about 15 percent of seats in parliament. "This could perhaps be my first and last appeal to you because of my (failing) health and age," said an emotional Koirala, 85, who had prostate surgery in Bangkok last year. "The nation is a common property of all," he said. "If there are problems we can solve them through dialogue. I once again appeal (to protest organisers) for talks and to end the protests immediately," the frail-looking leader said. There was no immediate comment from the Madhesi People's Rights Forum, which has led the latest protests. Earlier the group said it had received no invitation to a meeting.
