A row over America's choice of ambassador for Nepal seems set to sour relations between the two countries. Thomas Furey, whose nomination for the job was being processed in the US Senate, announced last week that he was having his nomination withdrawn because of a newspaper bid to label him as a racist. Mr Furey has categorically denied the allegations in a series of reports carried by the Kathmandu Post newspaper since April 11. US President Bill Clinton nominated him to the post on March 3. 'I have with deep regret and profound sadness requested the White House to withdraw my nomination ,' Mr Furey said in a statement on Friday. He was an officer at the US mission in Kathmandu in the early 1980s. The news reports, often quoting unnamed American sources, alleged that Mr Furey had abandoned a baby boy he and his wife adopted for six months because Mrs Furey's parents (now dead) did not like the idea of adopting a baby having dark skin. The first of the Kathmandu Post's headlines used the word 'racist'. 'In our view, the use of the word in the headline . . . is thoroughly unfair and completely unwarranted and unsubstantiated . . . since it is nowhere mentioned in the text of the article,' the US Embassy said before Mr Furey's decision to withdraw. The embassy also claimed that the 'matter [relating to adoption] was known to the US Government during the process of considering Mr Furey's nomination'. But the Kathmandu Post decided to follow up the issue even after the Ministry of Foreign Affairs gave its customary nod to Mr Furey's formal appointment as ambassador. Analysts criticised the foreign ministry mandarins for instigating people at the Prime Minister's office to leak the 'issue' to the media through a particular newspaper. 'This is the first ugly incident of its kind, and is bound to have harmful effects on Nepal's long-term relations with the US,' said Madhab Prasad Khanal, a former chief of protocol at the ministry. The US, which has had diplomatic relations with Nepal since 1947, has been one of the important Western countries to support its democratisation process that began in 1990.