Political conditions

1990–1996: Parliamentary monarchy

Until 1990, Nepal was an absolute monarchy running under the executive control of the king. Faced with a people's movement against the absolute monarchy, King Birendra, in 1990, agreed to large-scale political reforms by creating a parliamentary monarchy with the king as the head of state and a prime minister as the head of the government.

Nepal's legislature was bicameral consisting of a House of Representatives and a National Council. The House of Representatives consisted of 205 members directly elected by the people. The National Council had 60 members, 10 nominated by the king, 35 elected by the House of Representatives and the remaining 15 elected by an electoral college made up of chairs of villages and towns. The legislature had a five-year term, but was dissolved by the king before its term could end. All Nepalese citizens 18 years and older became eligible to vote.

The executive comprised the King and the Council of Ministers (the Cabinet). The leader of the coalition or party securing the maximum seats in an election was appointed as the Prime Minister. The Cabinet was appointed by the king on the recommendation of the Prime Minister.

Governments in Nepal have tended to be highly unstable; no government has survived for more than two years since 1991, either through internal collapse or parliamentary dissolution by the monarch.

In the first free and fair elections in Nepal in 1991, the Nepali Congress was victorious.

The 1994 election defeat of the Nepali Congress Party by the Communist Party of Nepal (Unified Marxist-Leninist) (CPN(UML)) made Nepal the first communist-led monarchy in Asia, with Man Mohan Adhikary prime minister. In mid-1994, parliament was dissolved due to dissension within the Nepali Congress Party. The subsequent general election, held 15 November 1994, gave no party a majority and led to several years of unstable coalition governments. As of the May 1999 general elections, the Nepali Congress Party once again headed a majority government. There have been three Nepali Congress Party Prime Ministers since the 1999 elections:K.P. Bhattarai (31 May 1999–17 March 2000); Girija Prasad Koirala (20 March 2000–19 July 2001); and Sher Bahadur Deuba (23 July 2001–2003). The final distribution of seats in Parliament gave the Nepali Congress 113; the CPN(UML) 69; the RPP 11; the RJM 5; the NSP 5; the Workers and Peasants Party 1; and the United People's Front 1. Nepali Congress Party has divided to Nepali Congress Party led by G. P. Koirala and Nepali Congress (Democratic) led by Sher Bahadur Deuba. Amongst the elected MPs, 39 MPs belong to Nepali Congress (Democratic). Former Prime Minister and Influential Leader Krishna Prasad Bhattarai has expressed his support for Nepali Congress (Democratic). Both Congress parties regard Krishna Prasad Bhattarai as their main leader.