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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.

Nepal’s economy is showing signs of steady recovery and resilience, according to latest reports from the World Bank, Asian Development Bank (ADB) and Nepal Rastra Bank (NRB). While the outlook is positive, these institutions say the country still faces some serious hurdles that need to be addressed to maintain this momentum.

The World Bank’s Nepal Development Update (April 2025) has forecast economic growth of 4.5 percent for the current fiscal year, up from 3.9 percent last year. It expects average growth of 5.4 percent over the next two years. The World Bank has attributed this rise to improvements in the services sector, boosted by stronger domestic trade, rising imports and solid performance in hydropower and construction. The ADB’s Asian Development Outlook (April 2025) offers a similar but slightly lower estimate of 4.4 percent growth. It highlights increased hydropower production and better agricultural output—especially in paddy farming—as key drivers of the growth. Both institutions have said that Nepal has managed to bounce back well, despite challenges like natural disasters and travel disruptions caused by the upgrade of Tribhuvan International Airport.

The NRB’s latest report supports this optimistic view. Inflation has eased to 3.85 percent in mid-March of 2025, down from 4.82 percent a year before—well below the central bank’s target. Foreign exchange reserves are healthy, enough to cover more than 17 months of merchandise imports and 14 months of merchandise and services imports, while exports are up by 57.2 percent. These indicators suggest that the country’s economic fundamentals are becoming more stable.

The growth prospects, however, are not without risks. The World Bank has warned that global issues, such as political conflicts, rising prices, and heavy dependence on remittances and tourism, could affect Nepal’s growth. It also said the FATF greylisting has hampered Nepal’s efforts to access international capital markets after having a BB- country rating. The ADB added that ongoing tariff rises may cause a global economic downturn, affecting Nepal’s tourism receipts and remittances, and lower foreign aid could negatively impact growth as Nepal relies on foreign aid to finance development needs. 

The government must prioritize reforms and enhance its spending efficiency to maintain this momentum. Promoting private sector growth through clearer laws and regulations, bolstering the financial system, harnessing hydropower potential, and upgrading tourism infrastructure could generate employment opportunities and lessen dependence on remittances. Similarly, the government should act swiftly to implement the Financial Action Task Force’s recommendations to secure Nepal’s removal from the ‘gray list.’ Failure to address this could lead to severe repercussions.

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 United States of America has condemned the violence that occurred during the pro-monarchy protests in Kathmandu on March 28. It extended deepest condolences to the families and friends of those who lost their lives.

On that day, pro-monarchy protests vandalized the public buildings including the offices of Annapurna Media Network and Kantipur Publication. They also set the buildings on fire with some damages.

A State Department spokesperson said: “The fundamental freedoms of expression and peaceful assembly must be protected. However, we do not condone violence and the destruction of property.” Regarding the attack on media houses, the spokesperson said that the United States supports media globally. The free flow of accurate information, ideas and opinion is the cornerstone of democracy, and it is essential that journalists be able to perform their work free from fear, the spokesperson said.

There are growing demands that there should be a fair investigation on the violence that occurred in the Tinkune area of Kathmandu. 

There are also reports that police used excessive force and indiscriminately opened fire on the protestors. Police have already arrested more than five-dozen people in connection with the violence.

The Nepal government is refusing to form a judicial commission to probe the March 28 violence. Regarding the attack on media houses, the international community remains silent and the US is the first country to speak about the violence. Over the past few weeks, pro-monarchy protests have been hitting the streets demanding the restoration of the monarchy and the Hindu state. In a latest series of protests, Rastriya Prajatantra Party organized a protest in Kathmandu on Tuesday.