Submit your Article

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.

The recent meeting between Nepali Prime Minister KP Sharma Oli and Indian Prime Minister Narendra Modi on the sidelines of the BIMSTEC summit in Thailand has sparked cautious optimism about the trajectory of bilateral relations. The one-on-one discussion, described by observers as potentially ice-breaking, comes against the backdrop of an unusually prolonged delay in arranging an official visit by Oli to New Delhi—a standard diplomatic protocol that typically follows a change of government in Nepal.

Ten months into Oli’s third term, the absence of an official invitation from India has fueled speculation about underlying tensions between the two neighbors. Diplomatic sources suggest several factors may be contributing to the hesitation, including Nepal’s deepening engagement with China through initiatives like the Belt and Road Initiative (BRI) framework agreement, which has reportedly caused discomfort in New Delhi.

Minister for Foreign Affairs Arzu Rana Deuba had previously indicated that preparations were underway for reciprocal visits by both prime ministers, but her recent silence on the matter suggests recalibrated expectations. Prime Minister Oli himself offered an unusually muted explanation upon returning from Thailand, stating simply that his India visit wasn’t happening due to his busy schedule and might occur “if time permits.” This contrasts with his more enthusiastic pronouncements about bilateral relations during previous terms.

Historical context suggests such delays aren’t unprecedented—former Prime Minister Sher Bahadur Deuba waited nine months after taking office in 2021 before visiting India. However, the current situation appears more complex, with Indian officials privately emphasizing their desire for any high-level visit to yield substantive outcomes, possibly including the inauguration of joint infrastructure projects. “There’s no major obstacle,” one senior Indian official noted, “but we want the visit to demonstrate tangible progress in the relationship.”

The delay in the prime minister’s visit to India does not mean that there is a lack of communication between the two governments. Oli and Modi first met on the sidelines of the 78th General Assembly of the United Nations in September last year. Since then, Foreign Minister Deuba has also held meetings with Indian Prime Minister Modi and her Indian counterpart S Jaishankar.

Officials say though there hasn’t been a prime ministerial-level exchange between Nepal and India,  meetings of all bilateral mechanisms have been taking place to address mutual concerns and issues. There have also been ministerial level visit exchanges and more are lined up in the imminent future. 

A senior official at the Office of the Prime Minister and Council of Ministers said, “The delay in the prime minister’s India visit doesn’t mean that the ties between Nepal and India have stalled, because all bilateral engagements are sailing in a smooth manner.”

Following the Thailand meeting between Oli and Modi, India’s Ministry of External Affairs released a carefully worded statement emphasizing continued cooperation in connectivity, energy and people-to-people ties, while conspicuously avoiding mention of more sensitive issues. The statement reaffirmed Nepal’s importance under India’s ‘Neighborhood First’ policy, suggesting an effort to project normalcy despite the evident diplomatic awkwardness.

The aborted plan for Modi to attend Nepal’s Sagarmatha Sambaad dialogue in May—ostensibly due to scheduling conflicts with a European trip—highlighted some of the coordination challenges for high-level exchanges. Nepali officials acknowledge the late invitation may have been a logistical misstep, but some analysts see it as emblematic of broader communication gaps.

India has reaffirmed its commitment to strengthening ties with neighboring countries through a consultative, non-reciprocal, and results-oriented approach. Pabitra Margherita, Minister of State for External Affairs, emphasized in a statement to the Lok Sabha that India’s neighborhood policy is guided by the core principles of Samman (respect), Samvad (dialogue), Shanti (peace), and Samriddhi (prosperity). These principles shape India’s engagements, ensuring that partnerships are built on mutual trust and shared progress.

India’s development assistance and capacity-building initiatives are tailored to the specific needs and aspirations of neighboring nations, supporting their long-term economic growth. The minister highlighted that India’s contributions range from large-scale infrastructure projects to community-driven development, including financial, technical, and humanitarian aid. This multifaceted approach underscores India’s role as a reliable partner in fostering regional stability and prosperity.

In Nepal, India’s cooperation focuses on enhancing connectivity, economic collaboration, and energy and digital infrastructure, alongside cultural exchanges. A key component of this partnership is the High Impact Community Development Projects (HICDP), which have delivered critical infrastructure such as hospitals, schools, and water and sanitation facilities. While the initiative faced some challenges last year, it has since moved forward smoothly. Originally launched in 2003 as a modest program, HICDP was expanded and rebranded in 2024 to maximize its developmental impact.

With the South Asian Association for Regional Cooperation (SAARC) remaining inactive, India has prioritized the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) as a more dynamic platform for regional collaboration. Margherita described BIMSTEC as a strategic convergence of India’s Neighbourhood First policy, Act East policy, and the SAGAR vision, which emphasizes security and sustainable growth in the Indo-Pacific. Through BIMSTEC, India is deepening cooperation in areas such as trade, security, connectivity, and digital innovation, while also promoting partnerships in health, education, and people-to-people ties. 

The upcoming BIMSTEC Summit, scheduled for April 3-4 in Thailand, is expected to produce a vision statement outlining future regional cooperation. Prime Minister KP Sharma Oli has already left for Thailand to attend the summit, while Indian Prime Minister Narendra Modi is also set to participate.

Margherita reiterated that India’s Neighborhood First policy is widely appreciated by partner countries, ensuring the continuity of assistance programs even amid political changes. She stressed that India’s relationships with its neighbors stand independently of their ties with other nations, reflecting the depth and resilience of these bilateral connections.

On national security, the minister affirmed that India remains vigilant, closely monitoring regional developments to safeguard its interests. He expressed confidence in the enduring strength of India’s partnerships and reaffirmed the country’s commitment to advancing mutual benefits while protecting its strategic priorities in the region.

The government’s decision to dismiss Kulman Ghising, the managing director of Nepal Electricity Authority (NEA), has triggered widespread public anger. Opposition parties—and even senior leaders from ruling coalition partners—have condemned the move, with only the CPN-UML standing firmly behind the unpopular decision. Protests have erupted both in the Parliament, where opposition lawmakers voiced dissent, and on the streets, where Ghising’s supporters gathered in solidarity.

Ghising has now approached the Supreme Court, seeking an interim order for his reinstatement. Over the past decade, he gained recognition for his role in ending Nepal’s chronic power cuts, though critics argue that increased electricity imports from India were the real solution—a point echoed by Energy Minister Deepak Khadka in the parliament last week.

Meanwhile, royalist forces are rallying for the restoration of the monarchy and the Hindu state, with a major protest planned in Kathmandu’s Tinkune area. Initially led by businessman Durga Prasai, the movement has since gained backing from various royalist groups, including the Rastriya Prajatantra Party (RPP), which had initially hesitated. RPP Chairman Rajendra Lingden has announced plans for an indefinite nationwide protest starting in April. Former King Gyanendra Shah, offering tacit support, recently visited Gorkha, where he was greeted by enthusiastic crowds. In response, opposition groups, including the CPN (Maoist Center)-led Samajbadi Morcha, are preparing counter-demonstrations, raising concerns of potential clashes.

In diplomatic developments, Prime Minister KP Sharma Oli is set to make a historic visit to Thailand—the first by a Nepali head of government since the two nations established diplomatic ties in 1959. Oli will attend the 6th BIMSTEC Summit (April 1-5), where leaders are expected to adopt the BIMSTEC Vision 2030, a blueprint for regional cooperation. On the sidelines, he is likely to meet Indian Prime Minister Narendra Modi, their first encounter since last year’s UN General Assembly. Notably, there has been little discussion in Kathmandu about Oli’s long-pending official visit to India, with Foreign Minister Arzu Rana Deuba remaining silent on the matter.

On the development front, the US government has permitted a partial resumption of Millennium Challenge Corporation (MCC) projects in Nepal, which had been paused during a review of foreign assistance under the Trump administration. While the review remains ongoing, select activities under the Nepal Compact can proceed, though officials caution that this does not guarantee full approval. Nepali authorities remain hopeful, citing bipartisan US support for the MCC.

The government has also renewed its demand for social media companies to register in Nepal or face bans, requiring them to appoint local representatives, grievance officers and compliance monitors. So far, only TikTok and Viber have complied.

Economically, Nepal has made notable progress in reducing poverty, nearly eradicating extreme poverty—a success largely driven by remittances, according to a recent World Bank report. However, the country’s economic growth remains sluggish, averaging just 4.2 percent since 1996, lagging behind regional peers due to low productivity, declining exports, and industrial stagnation. With limited domestic job opportunities, youth migration for foreign employment continues unabated.

In international forums, Nepal’s presence at China’s Boao Forum for Asia (March 25-28) will be low-key, with Ambassador Krishna Prasad Oli representing the country instead of high-level officials. Meanwhile, the Trump administration has signaled a tougher stance against Chinese influence in the Indo-Pacific, with US Defense Secretary Pete Herseth outlining an updated strategy that builds on the 2017 Indo-Pacific framework while adapting to current geopolitical realities.