Oli’s Return Promises Stability for Nepal as veteran communist politician K.P. Sharma Oli was sworn in as the country’s prime minister on July 15, 2024. This marks Oli’s fourth term as prime minister and makes him the fifth leader to hold the position in just five years. Oli’s Return Promises Stability for Nepal comes at a crucial time for the impoverished Himalayan nation, which desperately needs to attract investors and create jobs for its people.
The political landscape in Nepal has been tumultuous since the abolition of its 239-year-old monarchy in 2008. Oli’s new government will be the 14th since that historic change, underscoring the chronic instability that has plagued the country’s governance. At 72 years old, Oli heads the moderate Communist Party of Nepal (Unified Marxist Leninist) and was sworn in by President Ramchandra Paudel just three days after his predecessor, Pushpa Kamal Dahal, lost a parliamentary vote of confidence.
Oli wasted no time in forming his government, announcing a 22-member cabinet shortly after taking office. Key appointments include Bishnu Paudel as finance minister and Arzu Rana Deuba as foreign minister. Deuba, the wife of Nepali Congress (NC) president and former prime minister Sher Bahadur Deuba, represents the alliance partner NC in the new government.
The formation of this new government follows a period of political maneuvering that saw the UML withdraw support from Dahal’s Communist Party of Nepal (Maoist Center) and form a new alliance with the NC, which is the largest party in parliament. This shift in allegiances forced Dahal to prove his majority for the fifth time during his tumultuous 20-month tenure, ultimately leading to his downfall.
UML leaders have stated that the new alliance with NC was necessary to ensure political stability, though they have not provided specific details on how this will be achieved. The promise of stability is crucial for Nepal, which ranks as one of the world’s poorest countries. The persistent political instability has long discouraged investment and hindered economic development, forcing millions of young Nepalese to seek work abroad, primarily in countries like Malaysia, South Korea, and the Middle East.
The impact of this instability extends beyond economic concerns. It has sparked sporadic protests from citizens demanding the restoration of the monarchy, arguing that successive governments have failed to fulfill their commitments to develop the country. Nepal’s unique geopolitical position, sandwiched between India and China, adds another layer of complexity to its political situation.
Both New Delhi and Beijing closely monitor political developments in Kathmandu, as they compete for influence in the region through development aid and infrastructure investment. Oli’s previous terms as prime minister have been marked by efforts to balance these relationships. Notably, during his first term in 2015-2016, Oli took steps to strengthen ties with China by signing a transit agreement, effectively ending India’s monopoly over Nepal’s foreign trade.
The formation of the new government has already drawn international attention. Indian Prime Minister Narendra Modi was quick to congratulate Oli, expressing his desire to “work closely to further strengthen the deep bonds of friendship between our two countries and to further expand our mutually beneficial cooperation for the progress and prosperity of our peoples.” This statement underscores the importance of Nepal in regional diplomacy and the interest of neighboring powers in maintaining positive relations with Kathmandu.
However, political analysts warn that the new coalition between NC and UML is not without risks. Geja Sharma Wagle, an independent analyst, described the alliance as “risky and the last option,” cautioning that “if this coalition fails to deliver governance and political stability, the Nepali people will interpret it as the failure of the constitution and the system.” This assessment highlights the high stakes involved in Oli’s return to power and the expectations placed on his government to deliver tangible improvements in governance and economic development.
The challenges facing Oli’s government are substantial. Nepal’s economy has been struggling, exacerbated by the global COVID-19 pandemic and ongoing political instability. The country needs to attract foreign investment, create jobs, and improve infrastructure to lift its citizens out of poverty. Additionally, Nepal must navigate the complex geopolitical dynamics of its region, balancing its relationships with India and China while asserting its own national interests.
Oli’s experience in government and his party’s alliance with the NC may provide a foundation for addressing these challenges. The UML and NC represent two of Nepal’s largest political parties, and their cooperation could potentially lead to more effective governance and policy implementation. However, the history of political volatility in Nepal suggests that maintaining this alliance and translating it into stable governance will be a significant challenge.
The new government will need to focus on several key areas to deliver on its promise of stability and development. These include:
1. Economic reforms to attract investment and stimulate job creation
2. Infrastructure development, particularly in rural areas
3. Improving public services, including healthcare and education
4. Addressing corruption and enhancing government transparency
5. Balancing relations with India and China while pursuing Nepal’s national interests
6. Implementing policies to encourage young Nepalese to stay and work in the country
Oli’s return to power represents both an opportunity and a challenge for Nepal. If his government can provide the stability and effective governance that the country so desperately needs, it could mark a turning point in Nepal’s post-monarchy era. However, the fractious nature of Nepalese politics and the country’s recent history of short-lived governments suggest that achieving this goal will be no easy task.
As Nepal moves forward under Oli’s leadership, the world will be watching to see if this new government can break the cycle of instability and set the country on a path towards sustainable development and prosperity. The success or failure of this endeavor will have significant implications not only for Nepal but for the broader geopolitical landscape of South Asia.
