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The coalition government of the Nepali Congress and CPN-UML, which came to power with the promise of stability, has failed to deliver on its mission. Now, it has become almost a daily mantra for Prime Minister KP Sharma Oli and NC President Sher Bahadur Deuba to assure the public that their coalition remains intact. Every day, Prime Minister Oli seeks reassurance from his colleague Deuba that there is no threat to the government’s survival.

For instance, upon returning from a tour of Thailand, Deuba told reporters that there were no problems within the coalition. Prime Minister Oli has since been using this statement as a reference point to claim that his government is moving ahead smoothly. The two leaders are meeting frequently, but that does not necessarily mean that everything is fine. Tensions could be gradually building between the two parties. A frequently asked question among the media is about the longevity of the government. This has created a public perception that the coalition could collapse anytime, even though it may not happen immediately. It has shaped a widespread belief that even a government formed by the two largest parties has failed to convey a message of political stability.

Amidst this uncertainty, Prime Minister Oli and Deuba held a one-on-one meeting on April 26, although neither side has disclosed what actually transpired. Rumors of government change last week prompted Deuba to call Oli and assure him that the NC’s support remains firm. However, their failure to effectively handle contentious issues has fueled doubts about the coalition’s future. Past examples show how even minor issues have triggered the fall of governments. For instance, it took a long time for the two parties to agree on removing Kulman Ghising from the post of executive director of the Nepal Electricity Authority. A more recent example is the delayed appointment of the Governor of Nepal Rastra Bank due to differences between the NC and UML.

Above all, internal dynamics within the NC pose a major threat to the coalition. The decision to form an alliance with the UML was made without prior discussions in the party; it was largely driven by Deuba and his spouse, Arzu Rana Deuba, who currently serves as the Minister for Foreign Affairs. As a result, many senior NC leaders do not fully own the decision, and two distinct camps have emerged within the party. Leaders such as Purna Bahadur Khadka, NP Saud and Prakash Sharan Mahat favored continuing the coalition with the Maoists and would prefer forming a new government led by the NC. Just a few days ago, Khadka said, “I have told Prime Minister Oli to mend ways and improve the government’s performance.”

Meanwhile, leaders like Shekhar Koirala, Gagan Kumar Thapa and Bishwa Prakash Sharma are positioning themselves as populist figures aspiring to lead the party. Rather than offering unconditional support to the coalition, they view national issues through the lens of their personal political ambitions. For example, they have demanded that the government address the teachers’ demands, even though fulfilling them may not be feasible. At a public event this week, Thapa warned that the party would leave the government if it had to compromise on fundamental party principles.

Furthermore, Koirala and Thapa—both aspiring to become party president and future prime ministers—are working to prevent Deuba from becoming prime minister again. They fear that Deuba could use state power during the party leadership selection process to favor his loyalists. They believe that if the current coalition collapses, it would weaken Deuba’s chances of returning as prime minister. For some time, efforts have been underway to change the NC parliamentary party leader, but Koirala and Thapa themselves are not aligned, viewing each other as competitors for the party presidency—something that strategically benefits Deuba. In addition, there is speculation that some NC leaders are under pressure from India to break the alliance with the UML.

Adding to the complexity, CPN (Maoist Center) Chairman Pushpa Kamal Dahal has reportedly conveyed to senior NC leaders that he is ready to support Deuba as prime minister until the next election, gradually winning over a section of the NC leadership. Deuba’s phone call to Dahal before his departure for Thailand also raised eyebrows within the UML. Previously, Deuba had publicly emphasized that the NC should lead the government, given its emergence as the largest party in the 2022 elections. However, Dahal had refused to support the NC’s claim and instead aligned with the UML to form the government.

Within the NC, there is growing criticism that the coalition between the two largest parties has failed to deliver on its promises. For example, although the two parties had agreed to initiate the process of amending the constitution, they have yet to take any steps. Senior NC leaders say that Prime Minister Oli’s failure to address the country’s pressing issues is fueling public frustration, which has tarnished the party’s image. One NC leader remarked, “We do not feel comfortable staying on in the government with the UML.”

Despite repeated assurances from Deuba, UML and Oli remain uncertain about the NC’s continued support. UML leaders say external forces are actively working to destabilize the government, and at some point, the NC might withdraw its support and form a new alliance with the Maoists, sidelining the UML. This week, Oli also stated that he would not compromise on every issue just to remain in power.

Over the past few months, Nepal and India have intensified bilateral engagement, yielding tangible progress in economic and development partnerships. Although Prime Minister KP Sharma Oli’s visit to New Delhi remains uncertain, a series of ministerial meetings and bilateral mechanism discussions have taken place. Within two weeks, two senior ministers from Narendra Modi’s cabinet visited Nepal and met with Prime Minister Oli.

The past month witnessed a flurry of diplomatic activity, with three Nepali ministers traveling to India for meetings with their Indian counterparts. Foreign Minister Arzu Rana Deuba engaged in comprehensive bilateral talks with India’s External Affairs Minister, S Jaishankar, focusing on enhancing political and economic collaboration. Meanwhile, Forest Minister Ain Bahadur Shahi Thakuri met with India’s Minister for Environment, Forest and Climate Change, Bhupender Yadav, to discuss transboundary environmental conservation and sustainable forestry initiatives.

Another significant development occurred during Water Supply Minister Pradeep Yadav’s visit to New Delhi, where he met India’s Jal Shakti Minister CR Patil. The two leaders signed a landmark agreement to expand cooperation in water resource management, sanitation and hygiene—an area of critical importance for both nations. This agreement is expected to facilitate knowledge-sharing, infrastructure development and joint projects to address water scarcity and improve public health outcomes.

Indian Minister for Power and Housing and Urban Affairs Manohar Lal Khattar is currently in Nepal for a two-day official visit. According to Indian officials, the trip aimed to advance discussions on key power projects of mutual interest, including cross-border electricity trade and hydropower development. 

Over the past few years, energy cooperation between Nepal and India has seen remarkable progress, with Nepal exporting surplus hydropower to India and Indian firms investing in Nepal’s hydroelectric projects. This growing synergy in the power sector is expected to bolster Nepal’s energy independence while supporting India’s renewable energy goals.

Early this month, Nepal and India signed a Memorandum of Understanding (MoU) to strengthen cooperation in agricultural science and technology. The agreement, which replaces a 1991 pact, covers a wide range of areas, including agricultural production, crop management, trade and marketing. Nepal’s Agriculture Minister Ramnath Adhikari and India’s Agriculture Minister, Shivraj Singh Chouhan, formalized the deal, which is expected to enhance food security, boost farmer incomes and promote sustainable farming practices through joint research and technology transfer.

In late March, the Nepal-India Joint Working Group convened to address critical border management issues. The discussions centered on curbing cross-border crime, improving border infrastructure—such as Integrated Check Posts (ICPs), roads and railway networks—and enhancing the operational capacity of security agencies. Both sides also explored collaborative measures for disaster risk reduction and management, recognizing the shared vulnerabilities to natural calamities like floods and earthquakes.

Further reinforcing security and trade ties, the two countries held the 21st Director General-level talks this month, focusing on measures to streamline cross-border commerce and combat smuggling. These discussions are crucial for ensuring smooth trade flows, particularly given Nepal’s reliance on Indian ports for third-country trade.

Despite the positive trajectory in bilateral relations, certain contentious issues remain unresolved. Nepal has persistently raised concerns over the delayed implementation of the Eminent Persons’ Group (EPG) report and lingering border disputes, particularly in regions like Kalapani, Lipulekh and Limpiyadhura. India, however, maintains that these matters should be resolved through established bilateral mechanisms rather than public posturing.

Recently, India’s Ministry of External Affairs Spokesperson Randhir Jaiswal reiterated this stance during a weekly press briefing, stating, “We have a bilateral mechanism with Nepal to discuss these issues. Unilateral actions do not alter ground realities.”

While Prime Minister Oli’s visit to New Delhi remains uncertain, he has met with his Indian counterpart Modi on two occasions—first on the sidelines of the UN General Assembly in September 2024 and again during the BIMSTEC summit early this month. These interactions suggest a willingness to maintain dialogue despite political sensitivities.

However, a new point of friction emerged last month when reports surfaced alleging India’s tacit support for Nepal’s pro-monarchy movement. India swiftly denied these claims, but the episode highlights the delicate nature of Nepal’s domestic politics and its implications for bilateral relations. Additionally, some analysts speculate that India may view Nepal’s growing engagement with China—particularly its participation in China’s Belt and Road Initiative (BRI)—with caution.

Foreign policy experts say that despite occasional political tensions, India has adopted a pragmatic approach by prioritizing economic and developmental partnerships with Nepal. This strategy aims to insulate mutually beneficial projects from geopolitical fluctuations while gradually addressing contentious issues through diplomatic channels.

Over the past few weeks, Rajendra Lingden, chairperson of the Rastriya Prajatantra Party (RPP), has been under immense stress and anxiety as individuals outside his party attempted to hijack the leadership of the pro-monarchy movement. RPP remains the only significant party advocating for the restoration of the monarchy and Hindu state. As the party was preparing to launch a series of spring street protests, party member Nava Raj Subedi abruptly left to lead a separate pro-monarchy front—one informally led by businessman turned monarchy champion Durga Prasai. This unexpected move placed Lingden under pressure from both within his party and royalist sympathizers to align with the Prasai-led movement.

Senior party leaders Dhawal Shumsher Rana and Rabindra Mishra openly defied Lingden by joining Prasai, believing his approach offered a more forceful means to restore the monarchy and Hindu state. Although Lingden himself did not participate in the March 28 protests, he did not stop his cadres from doing so. As Lingden and his loyalists scrambled to uncover the architects behind the Subedi-Prasai alliance, suspicion grew within the RPP that former king Gyanendra Shah had covertly backed these non-political figures to undercut RPP’s influence. Despite being displeased with the actions of Rana and Mishra, Lingden chose not to escalate the issue, fearing it might lead to a party split.

Recently, Lingden breathed a sigh of relief after Shah invited him and other party leaders for a meeting, clarifying his preference for Lingden at the helm of the pro-monarchy campaign. According to RPP insiders, the former king also denied any role in the March 28 protests or contact with Prasai, despite a viral video showing Prasai exiting the former king’s residence. The former king reportedly clarified to Lingden that the Subedi-led committee had not been his initiative. His statements, along with the visible decline in momentum following the March 28 protests, suggest that RPP has regained control of the monarchist narrative.

Subedi is now under unofficial house arrest, and Jagman Gurung has replaced him as the leader of the movement. However, Gurung’s leadership has failed to gain traction. With Prasai in police custody, his largely non-ideological base has fractured, and his supporters have vanished from the streets. RPP continues to stage protests, but their size is diminishing. While the party insists that more demonstrations are coming, it appears unlikely that RPP will generate the kind of momentum necessary to compel the government into negotiations—at least in the short term.

Lingden remains under pressure from former king Shah to consolidate the growing base of monarchist supporters. Yet, there is a risk that other royalist factions may refuse to rally behind him. While the government has released Rana on health grounds, RPP is pushing for the release of Mishra as well. Meanwhile, Rastriya Prajatantra Party-Nepal, led by Kamal Thapa, has remained absent from the streets, though Thapa offers moral support to the movement.

Internal dynamics of RPP

Within the RPP, there are starkly divergent views on how to pursue the restoration of the monarchy and Hindu state. Lingden and his close allies advocate a pragmatic approach: acknowledging the party’s limited strength, they favor patience and calculated engagement. They argue that while street demonstrations can elevate the party’s visibility, they are unlikely to succeed without significant popular support.

On the other hand, leaders like Rana and Mishra believe the party must act decisively and launch full-fledged protests, even if they risk violence. During the March 28 protest, they tried to incite the crowd to march toward Singhadurbar or the airport, asserting that mere symbolic protests would not suffice. Despite his personal opposition, Lingden was reluctant to prevent his cadres from joining on moral grounds. Rana and Mishra have long expressed dissatisfaction with Lingden’s cautious leadership, believing that only an assertive street campaign can restore the monarchy.

A senior RPP leader said: “We don’t support figures like Prasai, but as a royalist party, we face a moral obligation to lend support to any group advancing our core agenda.” This moral quandary partly explains why both Rana and Mishra actively participated in the Prasai-led protests. Currently, RPP holds 14 parliamentary seats and, while it has accepted the 2015 constitution, it continues to advocate for a return to the monarchy. Still, many RPP leaders privately concede that restoring the monarchy is an uphill task and that the party should instead focus on reviving the Hindu state agenda.

Lessons for former king​​​​​​​

In recent years, former king Shah has made visible efforts to reassert his relevance, frequently traveling both domestically and internationally. Though he has refrained from publicly endorsing any political party, there were reports of him meeting Prasai just prior to the March 28 protest—a claim he later denied in a meeting with RPP leaders. Within RPP, there is suspicion that Gyanendra may have played a role in setting up the Subedi-led committee, although both Shah’s secretariat and Subedi insist this was not the case.

Some in the RPP interpret these developments as a deliberate attempt by the former King to sideline their party. In hindsight, the March 28 protests have offered a critical lesson for Shah: aligning with volatile, unelected figures like Prasai can harm the monarchy’s reputation. In the aftermath of the violence, which included arson and fatalities, political parties and the government alike held the former king partially responsible. Shah has since expressed sorrow over the events.

A movement lacking clarity​​​​​​​

While pro-monarchy protests seek the restoration of the monarchy and Hindu state, the movement suffers from a lack of clarity. There are lingering questions about Shah’s legacy and his son Paras Shah’s suitability for the throne. Many supporters avoid defending Shah and Paras’ past actions, insisting instead on the general principle of monarchy restoration. Even Subedi, in multiple media appearances, has stated that Paras is unfit to be king.

Moreover, the movement lacks a clear vision for what kind of monarchy it envisions. The rhetoric suggests a desire to dismantle current democratic structures and revert to a centralized monarchical system. Kamal Thapa has proposed that Parliament should determine the monarchy’s future role and position. Meanwhile, Shah has begun speaking more openly, calling for structural change while still professing support for democracy—an apparent contradiction that underscores the movement’s ideological disarray.

Can the course be reversed?

A close analysis of the demands made by royalist forces reveals a desire to completely reverse Nepal’s political trajectory. However, achieving this through street protests seems nearly impossible. The hope of achieving it through dialogue also appears unrealistic. As one veteran political scientist put it: “They want to restore the monarchy by creating anarchy like on March 28, but that will only push the country toward another civil war.” He added that any major instability could provoke a massive counter-movement from citizens who support the current system.

To their credit, RPP appears uninterested in fostering violence. Since March 28, the party has organized two peaceful demonstrations in Kathmandu. Yet, the dwindling size of these gatherings reflects the public’s limited appetite for radical political change.

RPP’s future path

Following his meeting with former king Shah, Lingden seems rejuvenated. The RPP has held two protests, although turnout continues to decline. The party is now focused on strategy, especially after the former king indicated his preference for RPP leadership in the monarchist movement. Shah’s assessment is that support is rising and that the RPP should unify royalist forces under its banner.

However, unity remains elusive. For now, RPP views the protests more as a platform to build momentum for the 2027 national elections than as a genuine push to reinstate the monarchy via street activism. With Prasai unlikely to be released anytime soon, the pro-monarchy movement—briefly commanding national and international attention—is beginning to fade. Unless royalist forces unite behind a clear vision, their campaign may fade into political irrelevance.

CPN (Maoist Center) Chairperson Pushpa Kamal Dahal has reignited his efforts to create discord within the ruling coalition, publicly claiming that the government could collapse at any moment due to growing dissatisfaction within the Nepali Congress (NC). His remarks have forced the CPN-UML Chairperson and Prime Minister KP Sharma Oli to publicly reaffirm the coalition’s stability.

For a brief period, Prime Minister Oli found respite as opposition parties, including Dahal, diverted their attention toward criticizing former King Gyanendra Shah amid pro-monarchy protests. However, with these protests losing momentum, Dahal has returned to his primary objective: toppling the current government and forming a new coalition with the NC. He has openly stated that it would be natural for the largest party to lead a new government, expressing his willingness to support NC President Sher Bahadur Deuba as prime minister. This has pressured Oli into urgent negotiations with senior NC leaders to secure their continued backing. 

NC leaders have publicly criticized the government’s performance, though both parties have agreed to resolve their differences.While Deuba himself may not be actively seeking to destabilize the government, Dahal’s statements have strengthened his bargaining power in key political appointments. Prime Minister Oli, once known for his uncompromising stance, now appears more flexible, offering crucial positions to the NC to maintain their support. UML leaders suspect that certain forces are working to isolate them ahead of the 2027 elections, potentially forming a grand electoral alliance against them. UML members also feel that the NC is increasingly dominating government affairs, creating unease within their ranks. 

Following the March 28 protests, pro-monarchy forces are attempting to regroup. Police recently arrested Durga Prasai, a key figure in the protests, in India’s Assam state, where he was hiding. Authorities are investigating his alleged involvement in arson, vandalism and violence during the demonstrations. The movement also appears fragmented, with Jagman Gurung’s group and the Rastriya Prajatantra Party (RPP) failing to coordinate unified protests. The RPP plans to launch mass demonstrations soon and is demanding the release of its leaders, Rabindra Mishra and Dhawal Shumsher Rana, though the government has refused negotiations.

In his New Year message, the former king expressed regret over last month’s violence but framed the protests as a sign of growing public awareness about Nepal’s future. Despite skepticism about his commitment to democracy, he reiterated his support for a multi-party system and constitutional monarchy, signaling a tacit approval of the pro-monarchy movement.

Meanwhile, teachers continue to protest, demanding government action on their grievances. Despite ongoing talks, resolution seems not so close, prompting the government to prepare for a House session to pass the Education Bill.

The High-Level Economic Reform Advisory Commission, led by former Finance Secretary Rameshore Khanal, has identified declining consumption and investment as major obstacles to economic growth. 

The commission recommends immediate policy measures to stimulate demand, alongside structural reforms to reduce production costs and improve competitiveness. Key issues include sluggish credit growth, stalled real estate transactions, funds trapped in cooperatives, delayed government payments, and a crisis in the construction sector. The report also highlights how pandemic-era monetary policies, inadequate fiscal stimulus and import restrictions have exacerbated economic stagnation over the past two years.

In yet another development, former President Bidya Devi Bhandari has hinted at her entry into UML politics, suggesting that due to health reasons, Prime Minister Oli may gradually hand over party leadership to her. Meanwhile, former Vice-President Nanda Kishor Pun has joined the Maoist Center.  At the same time, the Rastriya Swatantra Party (RSP), the fourth largest party in the parliament, continues to face a crisis disproportionate with its size after Chairperson Rabi Lamichhane’s re-arrest, casting uncertainty over its upcoming general convention. With Lamichhane detained, internal divisions among top leaders have weakened the party’s functionality, though efforts to strengthen grassroots organization continue.

The reinstatement of US tariffs could have severe repercussions for export-oriented least-developed countries (LDCs) whose economies are particularly sensitive to external economic shocks due to their concentration of trade on a small number of products as well as their limited resources to deal with setbacks, according to the WTO Secretariat's latest Global Trade Outlook and Statistics report released on 16 April.

Under the current situation with the pause on US' "reciprocal" tariffs, LDCs may benefit from trade diversion as their export structure is similar to China's, especially in textiles and electronics, the report said. 

The volume of world merchandise trade is expected to decline by 0.2% in 2025 under current conditions, nearly three percentage points lower than what would have been expected under a "low tariff" baseline scenario, according to the report.  This is premised on the tariff situation as of 14 April. Trade could shrink even further, to -1.5% in 2025, if the situation deteriorates.

Services trade, though not directly subject to tariffs, is also expected to be adversely affected, with the global volume of commercial services trade now forecast to grow by 4.0%, slower than expected.

Director-General  of WTO Ngozi Okonjo-Iweala said: "I am deeply concerned by the uncertainty surrounding trade policy, including the US-China stand-off. The recent de-escalation of tariff tensions has temporarily relieved some of the pressure on global trade.”

However, the enduring uncertainty threatens to act as a brake on global growth, with severe negative consequences for the world, the most vulnerable economies in particular, she said,  in the face of this crisis, WTO members have the unprecedented opportunity to inject dynamism into the organization, foster a level-playing field, streamline decision-making, and adapt our agreements to better meet today's global realities."

At the start of the year, the WTO Secretariat expected to see continued expansion of world trade in 2025 and 2026, with merchandise trade growing in line with world GDP and commercial services trade increasing at a faster pace. However, the large number of new tariffs introduced since January prompted WTO economists to reassess the trade situation, resulting in a substantial downgrade to their forecast for merchandise trade and a smaller reduction in their outlook for services trade.

Regional goods trade forecasts

The latest forecast marks a reversal from 2024, when the volume of world merchandise trade grew 2.9%, while GDP expanded by 2.8%, making 2024 the first year since 2017 (excluding the rebound from the COVID-19 pandemic) where merchandise trade grew faster than output.

In 2025, the impact of recent tariff measures on merchandise trade is expected to differ sharply across regions.

Under the current policy landscape, North America is expected to see a 12.6% decline in exports and 9.6% drop in imports in 2025. The region's performance would subtract 1.7 percentage points from world merchandise trade growth in 2025, turning the overall figure negative. Asia is projected to post modest growth in both exports and imports this year (1.6% for both), along with Europe (1.0% export growth, 1.9% import growth). Both regions' contributions to world trade growth would remain positive under current policies, albeit smaller than in the baseline low tariff scenario. The collective contribution to world trade growth of other regions would also remain positive, in part due to their importance as producers of energy products, demand for which tends to be stable over the global business cycle.

The disruption in US-China trade is expected to trigger significant trade diversion, raising concerns among third markets about increased competition from China. Chinese merchandise exports are projected to rise by 4% to 9% across all regions outside North America, as trade is redirected. At the same time, US imports from China are expected to fall sharply in sectors such as textiles, apparel, and electrical equipment, creating new export opportunities for other suppliers able to fill the gap.

Most services growth in 2025 will originate from Europe, where exports are expected to grow by 5.0% under current policies. European growth will continue at 4.4% in 2026. Asian economies' services exports are projected to increase by 4.4% in 2025 and by 5.1% in 2026. Growth in services exports of North America will slow to 1.6% in 2025 but then accelerate to 2.3% in 2026, the report said. 

For the Middle East, services exports are expected to grow by 1.7% in 2025 and 1.0% in 2026. In the Commonwealth of Independent States (CIS), growth of 1.1% in 2025 and of 3.5% in 2026 is anticipated. The outlook for 2025 is subdued for Africa and for South and Central America and the Caribbean, both of which are expected to record declines in 2025.

Prime Minister KP Sharma Oli’s government finds itself besieged on multiple fronts. PM Oli faces perhaps his most severe test since returning to power, with simmering public discontent threatening to boil over into broader instability. Across the country, disparate protest movements are gaining momentum—from pro-monarchy rallies capitalizing on a growing nostalgia for the royal era to weeks-long teacher strikes paralyzing education sectors. The recent communal violence in Birgunj serves as a worrying harbinger of how quickly localized grievances can escalate into wider unrest.

The economic backdrop further compounds these challenges. With growth stagnating and inflation squeezing household budgets, public patience with political dysfunction has worn dangerously thin. Even within the ruling coalition, tensions have reached unprecedented levels as a section of the Nepali Congress (NC) has voiced open dissatisfaction with the government’s performance. Some leaders have openly questioned whether continued support for Oli’s administration remains politically tenable.

Multiple sources within both ruling and opposition parties confide that there’s growing anxiety that the current constitutional order could face existential threats if the government fails to regain control of the narrative. The resurgence of monarchist sentiment, once considered politically marginal, has particularly alarmed republican forces across the spectrum. 

Analysts point to a dangerous vacuum emerging where the state's inability to deliver basic governance has allowed alternative political models to regain credibility among disillusioned citizens. The peace process-era promises of stability, development and accountable governance have largely gone unfulfilled, with corruption scandals and bureaucratic inertia dominating headlines. Prime Minister Oli’s opponents argue his administration has exacerbated these problems through a combination of distracted leadership and poor prioritization. 

Meanwhile, the coalition dynamics present Oli with an excruciating dilemma. While he depends on NC support to remain in power, that very dependence limits his ability to take decisive action. This climate of uncertainty has reportedly led to a reactive rather than strategic governing approach, with policies being crafted more to placate coalition partners than address systemic issues.

NC President Sher Bahadur Deuba’s role as both stabilizer and potential disruptor adds another layer of complexity. The NC leader has so far resisted calls from within his party to reconsider the alliance, but his continued support appears increasingly conditional. Oli’s repeated public commitments to honor the leadership transition agreement with Deuba reflect this precarious balance. Deuba faces his own mounting pressures, with NC hardliners arguing the party gains nothing from propping up an unpopular government while sharing the blame for its failures.

With skeptical rhetoric within the ruling coalition out in public, Prime Minister Oli held a discussion with coalition partner Deuba on Tuesday morning. The hour-long meeting at Baluwatar addressed concerns about the coalition’s longevity and criticisms that its functioning hasn’t reflected true partnership. Sources close to Prime Minister Oli confirmed there’s no fundamental disagreement between the two leaders regarding the coalition’s validity or duration. 

“Historically, unresolved issues between our parties have been settled through institutional mechanisms, and this tradition will continue,” a Baluwatar source said. “Both leaders are likely to promptly address these matters through formal channels.”

The coalition’s coordination committee will convene within days, with NC Vice-president Purna Bahadur Khadka currently serving as its coordinator.  

These developments follow opposition leader Pushpa Kamal Dahal’s New Year statement predicting imminent government change. The Maoist leader’s careful framing—suggesting an NC-led government as the natural alternative—appears designed to encourage defections while maintaining plausible deniability. However, Dahal faces his own credibility challenges, with many questioning whether his frequent government change predictions amount to meaningful strategy or mere political posturing.

Within the NC, the debate over the alliance has evolved from muted grumbling to open dissent. Shekhar Koirala’s blunt assessment that the party holds power without real influence captures the growing sentiment among NC lawmakers who feel they bear the costs of governance without enjoying its benefits. 

The party’s younger generation, represented by figures like Gagan Kumar Thapa, has been particularly vocal in demanding course correction. “We thought that the coalition of two major parties would initiate an amendment to the constitution to improve governance and expedite development works,” Thapa said.“But this government has failed to meet the expectations of the people.”

Another leader Bishwa Prakash Sharma has suggested Prime Minister Oli to focus on governance and development, rather than spending his precious time confronting his detractors. NC’s message to the prime minister is clear: to build public confidence in this coalition, he must deliver and not deviate.  

As the pressure mounts, Oli’s room for maneuver continues to narrow. The Prime Minister finds himself caught between an impatient public, restive coalition partners, and resurgent opposition. His recent efforts to project confidence, including claims that the UML-NC alliance remains strong, appear increasingly disconnected from the political realities on the ground. 

Prime Minister KP Sharma Oli participated in the sixth BIMSTEC Summit held on April 4 in Thailand, where he engaged in three significant events. He addressed the summit, held a one-on-one meeting with Indian Prime Minister Narendra Modi on the sidelines, and conducted bilateral talks with Thai officials. The discussions with Thailand led to the signing of several key agreements, taking Nepal–Thailand relations to a new level.

Oli’s brief meeting with Modi has drawn considerable attention back home, as speculation continues over the nature of their discussions. There is a widespread perception that the relationship between the two leaders has not always been warm, and many wonder if this encounter has paved the way for Oli’s long-awaited official visit to New Delhi. However, a close reading of Oli’s statements upon returning to Nepal indicates that such a visit is unlikely in the near future. In fact, both Oli and his team appear uncomfortable when questioned about a possible India trip. On the other hand, Indian officials maintain that bilateral ties are on a positive path and that high-level visits could occur when the time is right.

India’s engagement with Nepal has visibly increased in recent weeks. The two countries’ judicial bodies recently signed an agreement to cooperate on legal matters, and a fresh Memorandum of Understanding has been signed to expand cooperation in agriculture, covering crop production, trade, and technology. There was initial speculation that Prime Minister Modi would attend the Sagarmatha Dialogue in Nepal, but Oli confirmed that Modi had declined the invitation due to a scheduled trip to Europe during the same period. According to Oli, India has committed to sending a high-level delegation in his place. The Nepali government is also exploring the possibility of having the Chinese Premier address the Dialogue.

In a major political development, Rastriya Swatantra Party (RSP) Chair Rabi Lamichhane was arrested following a court order from the Butwal bench of the Tulsipur High Court in connection with a cooperative fraud case. His arrest came just days after he resumed his position as party chair and began overseeing party affairs. The timing and manner of his arrest, particularly its execution in the late evening, have drawn criticism from party leaders and supporters, who view it as politically motivated. DP Aryal has been named acting chairman of the party.

The re-arrest of Lamichhane has fueled rumors that the RSP may lean towards supporting the ongoing pro-monarchy protests, especially amid perceptions that the party’s commitment to the current political order is uncertain. The RSP is an ideologically diverse party, including liberals, conservatives, and left-leaning voices, making it difficult for the leadership to take a clear stance on political ideology without risking internal fractures. Instead, the party has focused heavily on issues of governance, appealing to a disillusioned electorate that is less concerned with ideology and more with performance.

Meanwhile, the pro-monarchy Rastriya Prajatantra Party (RPP) organized a mass protest on April 8 in Kathmandu, marking the first major demonstration since the violent March 28 rally. The RPP is attempting to take charge of the royalist movement, though not without resistance. Prasai, the controversial figure behind the initial protests and currently in hiding, released a video accusing certain leaders of attempting to hijack the movement. RPP leader Rajendra Lingden is working to consolidate leadership, but other pro-monarchy groups remain hesitant to support him. Kamal Thapa’s faction, Rastriya Prajatantra Party Nepal, has stayed largely inactive, although Thapa has been vocal on social media, cautioning against blaming former King Gyanendra for the March 28 violence. Senior RPP leaders Rabindra Mishra and Dhawal Shumsher Rana are currently in police custody. The Jug Man Singh Gurung-led committee is preparing another protest in Kathmandu, demanding the release of those detained over the March unrest. Prasai, despite being underground, appears determined to position himself as a political leader, though he may face legal action for inciting violence during the protests.

In another significant political development, seven Madhes-based parties—both represented in Parliament and outside—have formed a unified alliance to advocate for the region’s shared interests. Their main agenda is to push for constitutional amendments that address long-standing issues in the Madhes. The alliance also aims to send a clear message to both royalist and mainstream parties, whom they hold responsible for growing public discontent.

In recent weeks, the frequency and intensity of pro-Monarchy protests in Nepal have escalated, attracting significant attention both domestically and internationally. The international media, particularly in India, has been extensively covering these protests, fueling interest among political leaders and strategists worldwide. Indian media, in particular, is filled with news, opinions, and interviews related to the protests, further intensifying the global focus on Nepal's political landscape.

The protests gained widespread attention after the violent unrest on March 28, which resulted in two deaths and numerous injuries. Over 70 people have been arrested, including senior figures from the Rastriya Prajatantra Party (RPP), such as Dhawal Shumsher Rana and Rabindra Mishra. Durga Prasai, a businessman and self-proclaimed leader of the March 28 protest, is currently on the run. The RPP, which was divided over whether to support Prasai’s movement, has continued to push its cause, organizing a moderate demonstration in Kathmandu on April 8. They have declared indefinite protests starting April 20. The future of the movement, particularly under the leadership of Panchayat-era veteran Navaraj Subedi, remains uncertain.

After the March 28 violence, Subedi’s group, led by Jagman Gurung, ceased protests. There is a lack of cooperation between Gurung’s faction and other royalist groups like the RPP led by Rajendra Lingden and the Rastriya Prajatantra Party Nepal led by Kamal Thapa. The royalist camp remains divided due to personal clashes, though they have agreed to support each other’s protests. Despite this, they do not consider one another as leaders. Before the March 28 protest, Lingden had warned that backing Prasai could lead to the party's downfall, but senior leaders like Rana and Mishra chose to work under his leadership, which ultimately led to the violence.

Why are pro-monarchy protests taking place?

Nepal was ruled by the Shah monarchy for centuries, except during the 104 years of the Rana autocracy, which significantly weakened the monarchy, though it remained as an institution. In 2008, Nepal abolished the monarchy as part of a peace agreement with the Maoist rebels, who had demanded the end of the monarchy and the establishment of a federal republic. King Gyanendra, the last monarch, did not resist the move, as republican sentiments were overwhelming, even within monarchist factions like the Nepali Congress and the CPN-UML. The country also became a secular state in 2006, a move that has been controversial among certain sections of the population.

Since the monarchy’s abolition, a section of the population has expressed dissatisfaction with the manner in which key decisions, like the monarchy’s removal and the shift to a secular state, were made. Initially, pro-monarchy forces were silent, fearful of backlash from political parties, but over time, frustration with the political leadership's failure to deliver on promises of development and stability grew. As a result, pro-monarchy forces, including former King Gyanendra, have been framing the republican system as a failure, arguing that the monarchy could restore stability. Gyanendra has hinted that as he nears 80, he may push for the monarchy's revival. He has reportedly stated that if no progress is made in one or two years, he will abandon the effort, emphasizing that he does not want violence in his name.

Not the first time

No, this is not the first time pro-monarchy and Hindu state supporters have protested. Over the past decade and a half, there have been several such protests, including in 1990, 2021, 2023 and 2024. These protests have often resulted in clashes with the police. For example, in January 2021, thousands of pro-monarchy supporters rallied, drawing international attention to their cause, though the protests eventually subsided. In 2024, similar protests in Kathmandu led to confrontations with law enforcement, with the RPP regularly organizing protests in favor of monarchy and a Hindu state. Even during the constitution drafting process in 2015, pro-monarchy parties voted to retain the monarchy.

What triggered the latest protests?

The most recent wave of protests was sparked by a speech from King Gyanendra on Democracy Day (February 19). Traditionally, the king delivers a message on this day, but this year's speech deviated from previous ones. The king called for national unity and prosperity, urging citizens to support the institution of monarchy for national progress. Pro-monarchy forces quickly united, interpreting his speech as a call for the monarchy's restoration. Prior to the speech, protests were already being organized, with supporters reaching out to former senior officials for support. On March 9, thousands of people greeted Gyanendra upon his arrival in Kathmandu, which boosted the morale of his supporters.

Meanwhile, a loose network of pro-monarchy groups led by Navaraj Subedi had been preparing for a “third people's movement.” However, Durga Prasai, who was preparing for the March 28 protests, refused to align with the leadership of Subedi or RPP, eventually consolidating the movement under his own. This caused a split, with senior RPP leaders like Lingden and Thapa staying away from the Tinkune protests, though their supporters were involved. The protest turned violent.

How is the mainstream responding?

The major political parties, particularly the ruling communist factions—CPN-UML, CPN (Maoist Center), and CPN (Unified Socialist)—are sharply criticizing the monarchy and King Gyanendra. Pushpa Kamal Dahal and KP Sharma Oli have been particularly vocal in condemning the king. While these parties have organized protests against the monarchy, the Nepali Congress has not yet joined in the street protests, though it has expressed concerns about the growing monarchy movement. This situation has created a clear divide between monarchy supporters and republicans.

Is India behind?

There is no solid evidence to suggest that India is backing the pro-monarchy protests. High-level government officials in India  have denied any official Indian support. However, some in Nepal's ruling CPN-UML have speculated about India's involvement, though the party later clarified that it had no evidence of such support. Nepal’s Foreign Minister Arzu Rana Deuba raised the issue with her Indian counterpart S Jaishankar, who denied any backing for the protests. Additionally, Nepal’s Ambassador to India, Shankar Sharma, reportedly met with Uttar Pradesh Chief Minister Yogi Adityanath, a known supporter of the monarchy, but there is no clear indication of official support from India.

Will the movement succeed?

The pro-monarchy movement has weakened since the March 28 violence. Durga Prasai, who had mobilized thousands of people, is now on the run, and his absence poses a challenge for the movement. The RPP, which has a small presence in the Parliament, continues to advocate for the monarchy but struggles to unite royalist factions. While the RPP will likely continue its protests, these movements are unlikely to force the political parties into making significant changes. Royalist forces are unclear about what kind of political arrangement they want, but unless there is a dramatic shift, the current political system is unlikely to change.

The protests have brought all political parties together against the monarchy, but if the political leadership does not address the frustrations of the public, the discontent could pose a threat to the current system. What is clear, however, is that support for the monarchy is growing, largely due to the perceived failure of political parties to deliver on their promises.