Oli's history of consolidating power and sidelining coalition partners indicates that if these patterns continue, the stability of the new coalition could be at risk
In an unexpected turn of events in Kathmandu, the political parties on the edges of the spectrum, Nepali Congress (NC) and Communist Party of Nepal-Unified Marxist Leninist (CPN-UML) have joined hands to form a government under the leadership of CPN-UML chair, KP Sharma Oli, who will be serving as the new prime minister of Nepal. Marking the continuation of perennial political instability, this stint marks the fourth change in the ruling coalition within 19 months since the last general election in November 2022.
Since the last election, Pushpa Kamal Dahal (Prachanda), Chairman of Nepal Communist Party of Nepal-Maoist Centre (CPN-MC) remained the kingmaker, despite holding only 32 out of 275 seats in the House of Representatives. Former guerilla leader and veteran political player, Prachanda continuously managed to secure the position of prime minister as he tactfully took advantage of the hung parliament to switch between NC and CPN-UML—the two largest parties with almost equal parliamentary seats. Prachanda contested the 2022 elections within the Democratic Left electoral Alliance with NC and other smaller parties. However, he took no time to partner with CPN-UML after the election to form a government under his leadership in December 2022. The post-electoral coalition did not last long. Owing to Oli’s tendency to micro-manage the government, Prachanda switched the alliance with the Nepali Congress in March 2023 on the eve of the presidential election and backed the Congress candidate for the post. Again, in March 2024 he re-switched his alliance with CPN-UML due to pressure from internal and external factors to join hands with Oli.
Owing to Oli’s tendency to micro-manage the government, Prachanda switched the alliance with the Nepali Congress in March 2023 on the eve of the presidential election and backed the Congress candidate for the post.
Fast forward, the short-lived left coalition has been replaced by a seven-point deal between the two largest parties. According to the power-sharing deal, Oli will lead the government for the first two years and NC chairman Sher Bahadur Deuba will take charge of the office till the next election in 2027. However, the likelihood of such an arrangement holding up until the next elections remains uncertain.
Since the resumption of multi-party democracy in 1990 coalition politics has become a norm, only with rare exceptions. Shifting pre and post-electoral alliances have led to all forms of partnership among parties with differing ideological orientations. Coalitions have been more inevitable within the current mixed electoral system under the 2015 Constitution where the probability of a single-party majority is almost impossible. Looking back at the trend of alliances since 1990, the distant trend is the third largest party to play a decisive role in government formation either on their leadership or as a kingmaker. Prachanda, after the 2022 polls, leveraged this opportunity to switch alliances frequently despite modest popular support. In addition, the unexpected emergence of new political parties—Rastriya Swatantra Party (RSP) with 21 seats, Janamat Party with six seats and Nagarik Unmukti Party with four seats— has further complicated the political landscape, making it difficult to secure a stable majority.
Speaking at the Parliament to submit the proposal for the vote of confidence, newly elected PM Oli revealed the seven-point agreement and stressed the compulsion of the largest parties to come together for political stability, protect national interests, and ensure good governance and development. As per Oli’s announcement, the agreement includes the provision of a constitutional amendment for political stability. While he did not mention what provisions of the Constitution are to be amended, there are growing voices from both parties to amend the electoral system and increase the number of votes required to be counted as a national party for political stability. However, although Oli has gained the support of more than two-thirds of lawmakers, enough for constitutional amendments, it would not be easy to phase out proportional representation without a broader national consensus. Both Oli and Deuba are aware that starting the constitutional amendment game would lead to further amendment requests from within the coalition and beyond, leading to political chaos.
Despite the stated unpopular narrative of political stability, good governance, and development agendas to foster partnership between NC and CPN-UML, the convergence of immediate interests is paramount for the rather unlikely coalition this time.
First, despite being the largest parties, Deuba and Oli were discontent with letting a distinct third runner continue to lead the government. Further, Prachanda’s volatility in switching alliances, benefiting from the rift between NC and CPN-UML had left the leadership of both parties frustrated. Prachanda even went to lengths to claim his party had magic numbers and nobody could toggle his government as he had a few different tricks to serve a full term.
Prachanda’s volatility in switching alliances, benefiting from the rift between NC and CPN-UML had left the leadership of both parties frustrated.
Second, Oli had long desired to return as Prime Minister and was looking for an opportunity rather than waiting after Prachanda’s turn as per the deal. Prachanda’s ‘magic trick’ statement added to his suspicion. Meanwhile, there was growing discontent among the NC cadres being thrown out to opposition despite being the largest party which pressured the NC leadership to take the lead to forge a new coalition, even accepting Oli as Prime Minister for the first two years’ term.
Third, the infringement of the electoral and political space by new political parties, particularly the Rastriya Swatantra Party (RSP) had irked NC and CPN-UML. Sharing power with important ministerial posts and their critical role in forming coalitions was indeed a displeasure for the largest parties.
Fourth, the series of investigations on corruption scandals under the premiership of Prachanda and allegations on NC and CPN-UML high-ranking leaders induced a chaotic scenario within both parties. Some top leaders of both parties and their kith and kin were dragged into investigation including the fake Bhutanese Refugee scandal, the Lalita Niwas land scandal, the Giri Bandhu Tea Estate land grab, 60 kg gold scandal, among a few others.
Fifth, this alliance remained only the plausible option to realise the overlapping interests of NC and CPN-UML to bring the CPN-MC in size. Leaders of both parties have realised Prachanda’s notorious tendency of betrayal time and again. Their common agenda would be to alienate Prachanda from the mainstream, ultimately forcing him to contest the next election alone, while fulfilling Oli’s contest for the post and NC leading the next election government.
The certain difference in approach of NC and CPN-UML is evident in the conduct of the foreign relations given their ideological differences and subsequent proclivity towards different foreign powers. While CPN-UML chair Oli is heading the government, Arzu Rana Deuba, spouse of NC chairman and Ex-PM Sher Bahadur Deuba and ‘apparently’ most influential leader after him in NC is appointed as the Minister of Foreign Affairs. While in the earlier government, prime ministers used to be decisive in handling foreign affairs, now wider consultation on key issues of foreign affairs can be expected. Recently, the new minister for Foreign Affairs, just after assuming office stressed the implementation plan for the BRI, China’s flagship initiative cannot be signed in its current status without wider research, consultation, and discussion. China has long been pressuring the Kathmandu administration to strike a deal on implementation plans through leftist forces. The earlier CPN-UML and CPN-MC government under Prachanda almost signed the plan document during the meeting of the Nepal-China diplomatic consultation mechanism in June. But the government had to back off at the last moment after the reservations of NC in the Parliament. Meanwhile, Oli is inherently known to be pro-Chinese while NC is inclined more towards India and the US. This time, Oli would not enjoy the sole decision-making power and the foreign policy issues would be brought into greater consultation. However, no significant shifts can be expected other than promoting the status quo.
The earlier CPN-UML and CPN-MC government under Prachanda almost signed the plan document during the meeting of the Nepal-China diplomatic consultation mechanism in June.
This coalition is a necessity for NC and CPN-UML to gain power, which would otherwise be held by the parties with significantly lower seats, particularly due to the advantage Prachanda enjoyed in being at the central stage of politics through his tendency to leverage hung parliament with multiple episodes of alliance shifts among the largest two parties. However, this does nothing to ensure the fate of the new alliance. Oli's history of consolidating power and sidelining coalition partners indicates that if these patterns continue, the stability of the new coalition could be at risk. In the meantime, NC and CPN-UML have an opportune moment to revitalise their image and secure their electoral base by focusing on improved service delivery, governance, and development. Failing to do so would risk losing ground to alternative political parties and independent candidates in the next election.
Arpan Gelal is a Research and Programme Coordinator at the Centre for Social Innovation and Foreign Policy (CESIF), Nepal.
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Arpan Gelal is Research and Program Coordinator at the Centre for Social Innovation and Foreign Policy (CESIF), Nepal. He is also a teaching faculty at ...
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