Communist Party of Nepal (Unified Marxist–Leninist) chairman K.P. Sharma Oli was sworn in as Nepal’s prime minister on Monday, with backing from the largest party in the House of Representatives, the Nepal Congress (NC). Prime Minister Oli assembled a 22-member cabinet, appointing ministers from his own party, the NC, as well as from smaller parties such as the Janata Samajbadi Party (JSP) led by Ashok Rai, and the Loktantrik Samajbadi Party (LSP) under the leadership of veteran Madhesi leader Mahanta Thakur.
The new coalition commands more than a two-thirds majority in the 275-member House of Representatives: NC (88 seats), CPN-UML (79 seats), JSP (7 seats), and LSP (4 seats). All four parties have joined the government. Although the Janamat Party led by C.K. Raut, which holds 6 seats, has not joined the government, it has extended its support to the coalition.
On paper, Oli has formed a strong government similar to what he had achieved in 2018 after the formation of Nepal Communist Party after the merger of CPN-UML and CPN (Maoist Center). It may be noted, however, that internal power struggles and personal rivalries among the top leaders within the NCP ultimately resulted in the downfall of both the formidable government and the united communist party within three years.
Why have Nepal’s two largest parties formed a coalition government?
It is after a decade that the NC and CPN-UML have come together in a coalition, purportedly to ensure political stability, amend their Constitution and bolster the country’s fragile economy. The two parties had forged an alliance in 2014 with the goal of drafting a new Constitution through the second Constituent Assembly (CA) elections. But they parted ways after the Constitution was promulgated in 2015, allowing CPN (Maoist Center) leader Pushpa Kamal Dahal to emerge as a key figure in coalition dynamics.
Over the past 10 years, NC and CPN-UML have been hesitant to form a government, believing that such a coalition would weaken the opposition’s presence in the parliament.
Instead, both parties strategically aligned with the Maoists in a game of political musical chairs.
For example, in the 2017 parliamentary elections, CPN-UML formed a pre-poll alliance with CPN (MC), significantly reducing NC’s seats to 63. Ahead of the 2022 elections, it was NC’s turn to go with the Maoist Centre.
While NC became the largest party in the elections, CPN-UML was the second largest, with only 10 seats fewer in the lower house of parliament. When NC declined Dahal’s request to become prime minister, CPN-UML swiftly swooped in to offer unconditional support to the Maoist leader.
A month later, in February 2023, during the presidential elections, Dahal abandoned CPN-UML and supported NC’s candidate, Ram Chandra Poudel. As a result, UML withdrew, and NC joined the government. It lasted for around a year.
On March 4 this year, CPN-UML and CPN (Maoist Center) formed a new alliance with promises of consolidating the communist parties. A confident Dahal was publicly saying that he could become prime minister for a full five-year tenure without handing over to Oli if Maoist plays well between NC and UML. Analysts were not giving chances of NC and UML to be able to patch up their differences – therefore, the striking of the deal between Deuba and Oli on July 2 was a surprise to many, even to a score of party leaders and cadres of the both parties.
Why did ‘left alliance’ collapse?
When Dahal formed a short-lived alliance with CPN-UML this March, he claimed that it was the result of months of strained working relations between him and then finance minister and NC leader Prakash Sharan Mahat. At the same time, Dahal wanted to bring in new parties, such as the Rastriya Prajatantra Party, to create a perception of injecting fresh political blood in government.
The CPN-UML leadership, which had been out of power since 2021, believed that there were systematic attempts from both internal and external powers to keep it so. Their sole mission was to return to power – which led it to return to the arms of Dahal. The party initially aimed to foster unity among communist parties, but Oli gradually grew dissatisfied with the Dahal government’s approach. Oli even publicly expressed displeasure over the budget and other contentious issues, initially believing there was little chance of left unity.
Amid this backdrop, top leaders from NC and CPN-UML engaged in negotiations to explore collaboration. There were continuous secret talks between Oli and Deuba to rebuild trust, which had deteriorated since the dissolution of parliament in 2021.
The NC, ousted from the coalition by Dahal in March, was strongly motivated to avenge its ‘betrayal’. Additionally, Dahal’s deputy prime minister, Rastriya Swantra Party chief Rabi Lamichhane, targeted some NC leaders over alleged corruption scandals, which further fuelled the smaller party’s popularity among its supporters who were disenchanted with the establishment’s politicians.
In fact, the rise of new parties, like the RSP and other influential independent candidates, played a crucial role in bringing the NC and CPN-UML together. There is a growing disenchantment with traditional political entities, particularly among the younger demographic, who are increasingly drawn to alternative political voices. This trend has eroded the support base of both the NC and CPN-UML, resulting in a decrease in their overall vote shares. The alliance between these two parties could be viewed as a strategic response to jointly address the challenges posed by these emerging political dynamics.
What is the agenda of the new government?
The NC and CPN-UML have signed an agreement which is yet to be made public. According to leaked information, the two parties have agreed to ensure political stability, spur economic growth, and amend the constitution to change the electoral system and address other vital issues. According to the agreement, Oli is expected to hand over government leadership to Sher Bahadur Deuba just before the 2027 national elections.
Both parties believe that only a strong government, formed between them, can resolve the multiple crises facing the country today. However, as claimed by the new coalition, the issue of constitutional amendment is a challenging one. The two parties plan to amend the current mixed electoral system – Proportional Representation (PR) and First-Past-the-Post (FPTP) – arguing that it obstructs the path to a single-party majority and contributes to the growth of fringe parties. They believe this is the root cause of government instability in Nepal. Without agreement among at least the major parties in parliament, amending the Constitution will not be easy. As far as other issues are concerned, the two parties are yet to form a Common Minimum Program.
What will their foreign policy look like?
Handling foreign policy is always a complex task for any coalition government if the partners have differing approaches and priorities. Although NC and CPN-UML do not have significant differences in their overall foreign policy, they do have divergent views on certain issues, particularly regarding their largest neighbours, India and China. The Congress opposes taking loans under the Belt and Road Initiative to finance development projects, whereas the CPN-UML believes progress should be made in this area.
They also differ in their approach with India on issues such as the map dispute and the 1950 Peace and Friendship Treaty. Arzu Rana Deuba, the spouse of NC President Sher Bahadur Deuba, has been appointed as the foreign minister, which could lead to potential conflicts on foreign policy matters. Consequently, the coalition government is unlikely to make significant progress on major issues related to both India and China.
How long will this coalition last?
A key reason cited for Nepal’s largest and second largest parties to unite was to ensure government stability. Both leaders acknowledge that, given the multiple crises facing the country, it is their responsibility to join forces and tackle them. However, maintaining the coalition is a daunting task given the history of coalition governments, exacerbated by concerns over Oli’s track record as a team player. As prime minister, the onus is on Oli to sustain the coalition with NC.
