KATHMANDU, July 2: Differences between the ruling the CPN (Maoist Center) and the CPN-UML became evident with the recent budget presented by Finance Minister Barsha Man Pun and the dispute over the appointment of a new chief of the Securities Board of Nepal (SEBON). However, few anticipated that the Pushpa Kamal Dahal-led government’s days were already numbered. The late-night agreement between the Nepali Congress (NC) and the UML on Monday took many by surprise, causing a sudden shift in national politics.
What then led the UML to form an alliance with the NC just four months after allying with the Maoist Center? Despite UML Chairman Oli seemingly dictating key government decisions, including recall of ambassadors and other significant appointments, UML leaders were largely unhappy with Prime Minister Dahal's working style.
They particularly disapproved of the budget introduced by the Maoist Finance Minister Pun, which they labeled a ‘Maoist budget’ due to unilateral tax changes and the inclusion of the term Janayuddha (people’s war) in the budget. A large chunk of the budget was sent to the home districts of senior Maoist Center leaders.
Additionally, Prime Minister Dahal's refusal to appoint the UML's preferred candidate as SEBON chief further angered Chairman Oli, according to UML sources.
What is the possibility of NC-UML alliance?
NC youth leader Shankar Tiwari attributed the coalition's collapse to Prime Minister Dahal's misadventures, asserting that his loss of trustworthiness and risky actions were to blame. Despite an electoral alliance with the NC, Dahal broke it abruptly, without any warning. “His loss of trustworthiness and misguided actions are largely to blame for the collapse of the UML-Maoist Center alliance,” he said.
Several other factors upset the UML leadership, but the decisive moment was Prime Minister Dahal’s proposal to form a national consensus government with NC President Deuba on Thursday. UML Deputy General Secretary Pradip Gyawali stated at a press conference on Tuesday that Dahal's initiative to establish an alternative government even without their information triggered the coalition change.
Sources within the NC indicated that the Dahal-led government’s preparation to secure a substantial loan under the Belt and Road Initiative (BRI) made both the NC and a section of UML top leadership suspicious. The NC clarified on Monday that it opposes taking loans under BRI, advocating for BRI projects to be implemented only through grants.
NC lawmaker Ram Hari Khatiwada confirmed that the government was preparing to sign a significant loan agreement with China under the BRI framework. “We did not want this to happen. There has to be national consensus on issues of national importance. The working style of the prime minister is largely to be blamed for the new alliance,” he said.
Furthermore, Prime Minister Dahal’s public claims of having a 'magic number' to stay in power for the entire parliamentary term seemed to undermine the roles of the two major parties—NC and the UML. A senior NC leader, speaking on condition of anonymity, remarked that it was unnatural for a distant third-party leader to take the helm of the government and that Dahal's behavior did not sit well with the larger parties.
The leader also revealed that the NC was waiting for an opportunity to avenge Dahal for breaking the alliance overnight, without warning some four months ago. The NC and Maoist Center had agreed to share government leadership for two and a half years each when they went to the election together. President Deuba thought that it was the right opportunity to avenge Dahal as UML leaders approached him with a proposal to form a new government, ditching their alliance with the Maoist Center.
Insiders within the NC and UML said Home Minister Rabi Lamichhane's actions were also a critical factor in triggering the new alliance. There was a perception that PM Dahal had given Lamichhane free rein to undermine the UML and NC to strengthen his position.
Sources said that Lamichanne was preparing to arrest a few key leaders within the NC and even the UML on various graft cases. The recent arrest of Bechan Jha, one of the prime accused in the fake Bhutanese refugee scam, was likely to lead arrest of senior NC leaders including those close to President Deuba.
Speaking to the media on Tuesday, Lamichhane, who is also President of Rastriya Swatantra Party(RSP), hinted this, as he argued that the NC and the Maoist forged new alliance overnight after the Home Ministry opened major corruption files.
Sources also indicated that PM Dahal intended to fill upcoming vacancies for the coveted posts of the chief justice and central bank’s governor with loyalists, conflicting with the UML's desire to see their supporters in those positions. Dahal’s refusal to comply with the UML’s request for the SEBON chief appointment raised concerns about future appointments, contributing to the coalition collapse.
The NC and the UML sources suggested that Prime Minister Dahal had also made failed attempts to influence the Nepal Army's top leadership, causing unnecessary controversy and serving the interests of those close to him. The UML and the NC strongly opposed such practices, as Dahal previously had also tried to dismiss the incumbent army chief to serve his partisan interests.
