A Republic in Ruins

A massive protest in Nepal by young citizens (Gen Z) has compelled PM KP Sharma Oli and President Ramchandra Paudel to resign and leave the country on September 9. In Nepal, 56% of its population is below 30 years of age, compared with 37% in Bangladesh and 30% in Sri Lanka. The Himalayan capital is in flames. At least 30 people have died during the three days when the agitation was at its peak. The Parliament, government buildings, and private residences of present and past ministers have been burned. Ministers were chased and stripped on the streets. The wife of a former PM has been burnt to death. Chants of “KP chor, desh chhod (Oli is a thief, quit the country)” reverberated in the air across the capital. The army took control of Kathmandu. On September 10, the “Gen Z” groups who spearheaded the protests distanced themselves from the destruction, saying it was “hijacked” by “opportunists”.

Initially, the protest started against a ban on apps and social media platforms. A few days before the ban on apps, a “nepo kid” campaign, spotlighting the lavish lifestyles of the children of Nepalese politicians and allegations of corruption, flooded social media. The agitation continued even after the withdrawal of the ban and the resignation of the home minister.

Videos shared on social media showed the mobs beating up ex-PM Sher Bahadur Deuba and his wife, and foreign minister Arzu Rana Deuba. The mob also set a house belonging to former prime minister Jhala Nath Khanal on fire in Dallu. His wife, Rajyalaxmi Chitrakar, sustained serious burn injuries and succumbed to death at a hospital. Prime Minister Oli’s private residence was set on fire, while former Nepal PM Prachanda’s house was attacked by an angry mob on Tuesday.

On September 10, two important developments have received extensive attention. One, “Gen Z” groups that spearheaded the protests distanced themselves from the destruction, saying they had been “hijacked” by “opportunists”. Two, the former Chief Justice — popular for her zero-tolerance for corruption, Sushila Karki — an alumnus of the BNU who was impeached in 1917 for alleged judicial activism, is now Nepal’s PM. Kulman Ghising, former managing director of the Nepal Electricity Authority (NEA), had also emerged as a strong candidate for Nepal’s interim PM.

In recent years, China has substantially invested in energy, infrastructure, and the manufacturing sector. The NEA has ongoing collaboration with China’s State Grid Corporation of China (SGCC) and other entities, primarily focused on the cross-border transmission line project to facilitate electricity trade. Beyond grid interconnection, Chinese companies have also entered into contracts with the NEA for the construction of hydropower plants, such as the Tamakoshi V Hydroelectric Project. In July 2025, NEA signed minutes for a feasibility study with the China International Development Cooperation Agency (CIDCA) to advance the cross-border transmission line project.

Possible motives

Regime changes are not new to Nepal. Since Nepal became a republic in 2008, it has seen 14 governments, mostly in coalition, in the past 17 years. Political power rotated between K P Sharma Oli, leader of the Communist Party of Nepal (Unified Marxist–Leninist), widely seen as pro-China, Pushpa Kamal Dahal ‘Prachanda’ of the Communist Party of Nepal (Maoist Centre), and five-time PM Sher Bahadur Deuba of Nepali Congress. All three leaders face corruption allegations. The Nepalese youth have become increasingly frustrated with the political system. Economic stagnation and unemployment have only added fuel to the fire.

Two Serious Questions

First, is it a part of a process for the restoration of the monarchy, claiming that the experiment of making the Hindu-dominated Nepal a secular republic has failed? Significantly, when Nepal Army chief, General Ashok Raj Sigdel, addressed a restless nation on Tuesday, it wasn’t just his call for peace that was important. A portrait of King Prithvi Narayan Shah — the mid-18th-century monarch, who laid the foundation of modern Nepal, hung prominently behind him. Second, is Nepal a victim of a wider strategic game between emerging superpowers who want to retain strategic control on the South Asian region?

Monarchy in Nepal

In 1768, Gurkha ruler Prithvi Narayan Shah conquered Kathmandu and laid the foundations for a unified kingdom. The Anglo-Nepalese War (1814-16) culminated in a treaty that established Nepal’s current boundaries. In 1846, Nepal fell under the sway of hereditary chief ministers known as Ranas, who dominated the monarchy. The end of the Rana era, a hundred years later, came about through an armed uprising spearheaded by a newly formed political party — Nepali Congress (NC). But the 1951 Interim Constitution allowed the space for the monarchy to reassert itself.

After a brief interlude of democratic rule in 1959-60, King Mahendra took over and banned all political parties. A new constitution decreed by Mahendra in 1962 introduced the party-less ‘Panchayat’ political system — ostensibly a ‘Nepali’ version of democracy that in reality concentrated power in the palace. The first election to the Rastrya Panchayat was held in 1963. In 1972, King Mahendra died and was succeeded by King Birendra.

On June 1, 2001, the Crown Prince Dipendra killed King Birendra, Queen Aishwarya and several members of the royal family, before shooting himself. The king’s brother, Gyanendra, was crowned the king. In November 2001, he declared a ‘State of emergency’ after more than 100 people were killed in four days of violence. King Gyanendra ordered the army to crush the Maoist rebels. Hundreds of Maoists were killed in the following months. Since then, King Gyanendra Shah has lived as a private citizen. His main residence is Nirmal Niwas in Kathmandu. However, Queen Mother Ratna continues to live at Mahendra Manzil, within the former royal palace complex.

In March 2025, pro-monarchy demonstrations drew large crowds chanting, “Come back, king, save the country.” Alongside royalist slogans, protesters demanded Oli’s resignation. Later in May, pro-monarchy groups led by Nabaraj Subedi launched a nationwide protest campaign. The ruling CPN-UML party held counter-protests to defend Nepal’s republican system, particularly on Republic Day.

Communist Uprising and Relation with China

Communists played a crucial role in the abolition of the monarchy and the establishment of the Nepali Republic. The Communist Party of Nepal - Unity Centre (CPN-UC) had declared in December 1991 that it would initiate a “people’s war” to bring about a new democratic revolution in Nepal. In 1994, the CPN Unity Centre was split, apparently over disagreement about whether to initiate an armed rebellion. One faction, led by Pushpa Kamal Dhakal, alias Prachanda, went on to become the CPN-Maoist and went completely underground, decided not to participate in elected government any further, and began to prepare for an armed uprising.

On February 4, 1996, just days before the conflict began, Baburam Bhattarai, representing the United People’s Front Nepal (UPFN), the political wing of the Maoists, presented a forty-point list of demands to then Prime Minister Sher Bahadur Deuba. The 40 demands included, among others, demands that would mean the end of Nepal’s 200-year-old monarchy. Nepal’s civil war began on February 13, 1996, with a series of attacks by the Maoist faction of the Communist Party of Nepal (CPN-Maoist) on several police posts in three districts. The Maoists declared the beginning of a “people’s war” and the “rule of the proletariat.

By mid-2001, the Maoists had established effective command in twenty-two of Nepal’s 75 districts. In most of these districts, the Maoists controlled development projects, courts, schools and health facilities, imposed taxes, and generally assumed the functions of a state. By early 2004, the Nepali security forces had effectively retreated to heavily fortified bases in the district headquarters of various provinces, ceding control of much of the countryside to the Maoists. Massive protest rallies in Kathmandu in April 2004 forced the resignation of the pro-Royalist administration, adding to the political uncertainty facing Nepal.

In November 2006, the govt signed a peace deal with the Maoists — the Comprehensive Peace Agreement (CPA) — formally ending the decade-long insurgency, and in January 2007, Maoist leaders entered parliament under the terms of a temporary constitution. In December 2007, the Parliament approved the abolition of the monarchy as part of a peace deal with Maoists. In May 2008, Nepal became a republic, and in July, Ram Baran Yadav became Nepal’s first president. In August 2008, Maoist leader Pushpa Kamal Dahal, aka Prachanda, formed a coalition government, with the Nepali Congress going into opposition. 2009 May - Prime Minister Prachanda resigned following a row with President Yadav over the integration of former rebel fighters into the military.

In September 2015, the Parliament passed a landmark constitution, which defines Nepal as a secular country, and in October 2015, K.P. Prasad Oli(CPN-UC) became the first prime minister to be elected under the new constitution. But in July 2016, the Maoist party (CPN-Maoist) pulled out of the governing coalition. Prime Minister Oli resigned ahead of a no-confidence vote in parliament. In August, Parliament elected Maoist party leader Pushpa Kamal Dahal, aka Prachanda, as prime minister for the second time. In 2017, China and Nepal held their first-ever joint military exercise. In June 2017, Pushpa Kamal Dahal was replaced as prime minister by the Congress (NC) leader Sher Bahadur Deuba under a rotation agreement.

In October 2019, President Xi Jinping became the first Chinese leader since Jiang Zemin in 1996 to visit the Himalayan country of Nepal. Xi and Nepalese Prime Minister KP Sharma Oli witnessed the signing of 18 agreements and two letters of exchange in areas of connectivity, security, border management, trade, tourism and education. Nearly $500m in financial aid was also pledged amid Beijing’s growing influence in the impoverished Himalayan nation. Nepal is a member of China’s Belt and Road Initiative, and over the years, China-Nepal ties have been strengthened.

US Government’s MCC

The MCC was formed in 2004 against the backdrop of the 9/11 attacks. It is seen as a separate agency from other state department funds and USAID. On 14 February 2025, Kathmandu was informed of the freeze on all payments related to the US$500-million Nepal Compact of the US government’s Millennium Challenge Corporation (MCC). Since its signing in September 2017 and ratification by the Nepal Parliament in February 2022, following a motion proposed by the PM of the coalition government, Sher Bahadur Deuba, leader of the Nepali Congress Party and a staunch supporter of the MCC.

Initially signed in 2017 under the first Trump administration, the Nepal compact focused on increasing access to electricity and improving road maintenance. MCC agreed to provide $550 million in grant resources over five years. For its part, the Government of Nepal committed to its own substantial investment of $197 million.

Kathmandu’s initiation under the program made it the only South Asian country to join the compact. Analysts believe that for Washington, South Asia has emerged as a node in the competition between the US and China and their attempts to counter each other’s influence. For Nepal, Washington’s increasing attention over the previous few years was an opportunity to diversify its relations and leverage economic opportunities. Under this program, two projects were planned: a 300-km power transmission line from Lapsiphedi (Nepal) to the Indian border (18 km) near Gorakhpur, to be maintained, and the Department of Roads and the Roads Board of Nepal would maintain the quality of roads along the primary or strategic road network. A sudden freeze on payments by the donors has jeopardised the program. The New York Times highlighted the potential geopolitical risk in Nepal posed by curbing MCC expenditures.

Recent Indo-Nepal Tensions

The Hindi-speaking Nepalis, inhabiting the Terai Region of Nepal, and derogatorily referred to as ‘Madheshis’, have created animosity between India and Nepal, especially after the adoption of the Nepali constitution in 2015. Immediately after the adoption of the Constitution, it triggered fresh conflicts as it was being shunned by the marginalised communities such as Madhesis, Tharus, Janajatis, Dalits and women. The Government of Nepal mobilised the Army as well as the Armed Police Force and declared a curfew in several parts of the southern plains as the conflict had escalated and resulted in the tragic death of more than 40 people. A last-ditch effort by the Indian PM’s special envoy, S. Jaishankar, failed to convince Nepal’s major political parties to take measures to pacify the situation.

This issue took an ugly turn last month when India and China agreed to resume border trade through Lipulekh pass and two other trading points. Nepal’s ruling party (CPN-UM) has expressed reservations over this agreement. Nepal claims Lipulekh as its own territory, a claim that India has categorically rejected as “neither justified nor based on historical facts and evidence.” At the second national convention of Prime Minister K P Sharma Oli-led CPN-UML held from September 5–7 at Godavari Municipality of Lalitpur district, the Prime Minister had urged the Nepal government to resolve the issue through high-level diplomatic initiatives and reiterated Nepal’s rights over the region east of the Kali River, including Kalapani, Limpiyadhura and Lipulekh. This claim for a greater Nepal has created serious political tensions between the two neighbours.

Since 2021, a series of political storms have rocked India’s neighbourhood — Myanmar, Pakistan, Sri Lanka, Bangladesh and Nepal. Allegations of ‘corruption’ against the ruling establishments were the main cause behind all these regime changes Nepal’s Gen Z revolution reminds us about the Jasmine Revolution in Tunisia in 2010-2011, which was fuelled for the first time by social media and successfully ended the 23-year rule of Zine El Abidine Ben Ali. The success of the uprising inspired a wave of similar protests, branded as the ‘Arab Spring’, throughout the MENA region.

While assessing its impact, the EPW observed that the Arab Spring protests had produced a mixed legacy—from a democratic shift in Tunisia to protracted civil wars in Libya, Syria, and Yemen. The civil wars had morphed into proxy wars, with the military intervention of regional and global powers that have brought their own geopolitical interests into the mix. The long-drawn conflict in the region had arguably fuelled widespread internal displacement as well as a massive influx of refugees (especially from Syria and Yemen) into Turkey and across the Mediterranean into mainland Europe, culminating in what has been called a “global refugee crisis”. The ‘Arab Spring’ made way for the rise of the Islamic State, the study inferred.The present uprising in Nepal is the outcome of the power struggle between the royal supporters of the deposed Hindu monarch and the new political elites of a nascent secular democratic state. With the tacit support of India and the USA, the royals are at an advantage now. Nonetheless, the pro-Chinese secular forces that fought for decades to dethrone the monarchy will certainly resist this move, leading to another civil war. Political and economic instability in Nepal will further exacerbate the South and East Asian refugee crisis.