KATHMANDU: Nepal’s political class has seldom looked more discredited. Within two days in early September (08-09), a youth-led revolt—dubbed the “Gen Z movement”—swept aside the coalition government of the Nepali Congress and the Communist Party of Nepal (UML). Parliament was dissolved, ministries torched, and the state’s legitimacy reduced to rubble. Into this vacuum stepped an unlikely figure: Sushila Karki, a former chief justice, appointed on September 19th as interim prime minister.

Her elevation is historic: the first woman to lead Nepal’s executive. It is also unprecedented. President Ramchandra Paudel invoked Article 61 of the constitution—a clause never before used—to resolve what had become an institutional deadlock. That maneuver reflects both the ingenuity and fragility of Nepal’s constitutional order.

Ms Karki, known for her integrity and disdain for corruption during her judicial career, offers a symbolic answer to the protestors’ demands for clean politics. For many young Nepalis, the movement was not about ideology but about accountability and opportunity. Their fury stemmed from endemic corruption, a sclerotic leadership and a stagnant economy that forces hundreds of thousands abroad for work. The appointment of a jurist untarnished by party politics gives hope that governance might, briefly, be conducted with impartiality.

But symbolism will not suffice. Seventy-four lives were lost during the upheaval, and the interim government’s mandate is narrow: to restore order and deliver elections to the House of Representatives within six months. That means organizing credible polls while rebuilding confidence in the state’s institutions—executive, legislature and judiciary—all of which were literally set aflame.

The challenges are formidable. Traditional parties may be humbled, but they are not finished. Their entrenched patronage networks reach deep into bureaucracy and villages alike, and they will resist reforms that threaten their interests. Meanwhile, the Gen Z movement, though potent, is fragmented into competing factions, each claiming ownership of the uprising. Ms Karki must navigate between these rival forces without the organizational muscle that a seasoned party would normally provide.

For Nepal, the appointment of a judge as prime minister is both a moment of pride and a gamble born of desperation.

Beyond politics, the economy is battered. Unemployment is rising, growth is anemic, and natural disasters have added further strain. Ordinary citizens will expect action, however unrealistic, from a government designed only to steady the ship. The risk is that disappointment could trigger renewed instability before elections even take place.

The test for Ms Karki is twofold. First, to defend democratic procedure by holding elections on time and under conditions of freedom and security. Second, to show—however briefly—that governance can be transparent, accountable and fair. If she can demonstrate that politics need not be synonymous with graft, she may leave behind a standard that future governments will find hard to ignore.

For Nepal, the appointment of a judge as prime minister is both a moment of pride and a gamble born of desperation. Whether Ms Karki’s interim tenure becomes a turning point or a footnote will depend not only on her resolve, but also on whether Nepal’s citizens, parties and institutions seize this chance to restore a semblance of stability. Key priorities the interim government must not forget:

Law and order must come first in Nepal’s fragile transition

On September 8 and 9, Nepal’s cities slipped into anarchy. What began as a Gen Z-led protest against corruption and entrenched elites quickly spiraled into vandalism, arson and looting. In Kathmandu, Singha Durbar—the nerve center of government—along with parliament and the Supreme Court, were reduced to ashes. In moments of such collapse, it is not only the government that falters but the very state itself, unable to guarantee citizens’ security.

The chaos was compounded by a stunning breakdown in the prison system. In the wake of the GenZ protests on September 8-9, Nepal faces a security crisis: 8,816 prisoners are still unaccounted for, according to the Department of Prison Management. During the unrest, inmates fled from 27 prisons and nine juvenile correctional homes nationwide.

Out of 29,212 adult inmates, 13,591 escaped, while 964 of 1,422 juveniles also broke free. Recapture efforts have returned 5,495 adults and 244 juveniles. Affected facilities include major prisons in Kathmandu, Chitwan, Kaski, Solukhumbu and dozens of other districts, as well as juvenile homes in Morang, Bhaktapur, Parsa and Kaski.

The scale of the jailbreak underscores the fragility of Nepal’s security apparatus during periods of political upheaval and raises urgent concerns about law and order ahead of upcoming elections.

More than 1,100 firearms were looted from police barracks and offices, raising fears that weapons may fall into criminal hands.

The revolt has shaken the morale of the Nepal Police and the Armed Police Force, who proved unable to contain the unrest. The Nepal Army eventually imposed curfews and reasserted control, but the damage to public confidence has been immense. The sight of state institutions in flames, and thousands of convicts at large, is a reminder that Nepal’s political crisis has also become a crisis of law and order.

More than 1,100 firearms were looted from police barracks and offices, raising fears that weapons may fall into criminal hands. Across 455 police facilities, 197 were destroyed and 258 partially damaged. Three officers were killed and nearly 2,000 police injured.

Authorities warn that the stolen arms could challenge the security apparatus and exacerbate lawlessness if used by opportunists or organized criminals. Restoring order and recovering the looted weapons has become the government’s urgent priority ahead of upcoming elections.

The uprising reflected genuine grievances: endemic corruption, poor governance and economic despair. But leaderless movements are vulnerable to infiltration by anarchic elements. The Gen Z protest, originally conceived as peaceful, was hijacked by vandals and criminals. These risks discrediting its moral legitimacy and narrowing sympathy among civil society and abroad.

The jailbreaks present a longer-term danger. Thousands of fugitives at large will strain already fragile security institutions and undermine the credibility of the interim administration. A caretaker government charged with organizing fresh elections cannot do so if insecurity persists. Without law and order, the polls scheduled for March 2026 risk becoming meaningless.

Information, too, is part of the battlefield. During the protests, rumors and misinformation spread rapidly across social media, fueling panic and even inciting violence. In such volatile circumstances, fact-checking and responsible journalism are as critical as military patrols. Nepal’s media will need to exercise restraint to avoid further destabilization.

The lesson of the Gen Z revolt is stark: without law and order, neither democracy nor development is possible.

The challenge now is clear. Nepal’s interim government must not only organize elections but also restore the authority of the state, rebuild public confidence in security institutions and ensure that democratic processes unfold in an environment of order. Citizens may tolerate political transition, but they will not forgive the normalization of anarchy.

The lesson of the Gen Z revolt is stark: without law and order, neither democracy nor development is possible. The government must priorities security, strengthen policing, recapture escaped prisoners and guarantee safety in the streets. Only then can elections be held in a free and fearless atmosphere, laying the groundwork for stability and a more hopeful future.

Prioritize economic recovery

Nepal’s economy suffered a severe blow during the recent Gen Z protests. Preliminary assessments indicate total losses exceeding Rs. 80 billion, with damage spanning both public and private sectors. Key government buildings, including Singha Durbar, the Supreme Court and the Federal Parliament, were torched, while corporate offices, hotels, and retail outlets also bore the brunt of violence and vandalism. The full economic cost has yet to be tallied, leaving a significant uncertainty over the country’s recovery trajectory.

The hospitality sector has been particularly hard hit. Dozens of hotels were looted or destroyed, with losses estimated at Rs. 25 billion. The newly constructed Hilton Hotel alone accounted for Rs. 8 billion in damages.

Retail giants were not spared: Bhatebhateni’s 21 out of 28 outlets were damaged, 12 of which were destroyed, contributing to further economic disruption. Auto dealers estimate losses of roughly Rs. 15 billion. Infrastructure supporting tourism—Chandragiri and Maulakali cable cars—along with corporate offices of Ncell, Simrik Air, Annapurna Post, and Kantipur Daily, were also targeted.

The timing exacerbated the impact. The protests erupted just weeks before Dashain and Tihar, Nepal’s most economically active festivals, which normally boost spending on travel, food, and goods.

Finance Minister Rameshore Khanal has vowed to end piecemeal projects, redirecting approximately Rs. 100 billion toward rebuilding key infrastructure.

Casualties of at least 72 people, coupled with widespread property loss, have dampened consumer confidence and disrupted the social and cultural fabric of the nation. The tourism industry, a cornerstone of Nepal’s economy, has seen sharp declines in bookings, leaving thousands of workers unemployed.

Prime Minister Sushila Karki’s interim government has pledged to address these losses decisively. Newly appointed ministers have committed to reconstructing destroyed infrastructure and reviving confidence in both public and private sectors.

Finance Minister Rameshore Khanal has vowed to end piecemeal projects, redirecting approximately Rs. 100 billion toward rebuilding key infrastructure. He views the post-revolt period as an opportunity for course correction, including measures to remove Nepal from the FATF grey list.

Business leaders emphasize that recovery hinges not just on rebuilding physical assets but also on restoring political stability, good governance, and an investment-friendly environment. Their determination to “rise again” signals resilience within Nepal’s private sector and offers a foundation for renewed economic momentum.

Restoring infrastructure, ensuring transparency, and fostering confidence in governance are essential first steps. With coordinated public and private action, Nepal can turn this crisis into a chance to accelerate economic reform and recovery, ensuring that the country not only rebuilds but also strengthens the foundations for long-term growth.

The recent unrest inflicted a devastating blow on Nepal’s private sector, targeting businesses that generate tens of thousands of jobs, contribute to public revenue, and underpin economic development. Attacks on commercial enterprises and historic or civic buildings are unjustifiable. Justice must be ensured both for victims of violence and for the perpetrators of these crimes.

Equally urgent is reconstruction. The lives and livelihoods of countless Nepalis depend on the revival of gutted businesses. Finance Minister Rameshore Khanal has pledged to prioritise this, extending tax deadlines and exploring concessions to ease the burden on entrepreneurs. A dedicated reconstruction fund has been established, with Corporate Social Responsibility (CSR) contributions earmarked for rebuilding damaged infrastructure.

Delays increase costs, prolong unemployment, and risk long-term economic stagnation.

The Federation of Nepalese Chambers of Commerce and Industry (FNCCI) has called for a structured dialogue with the government, as well as loan restructuring, tax relief, and incentives for tourism and production. Entrepreneurs, despite their losses, remain determined to rebuild, create jobs, and sustain revenue.

Reconstruction cannot wait. Delays increase costs, prolong unemployment, and risk long-term economic stagnation. In Nepal, as in every economy, the private sector is the growth engine. The government must act decisively—streamlining bureaucracy, offering fiscal relief, and channeling resources swiftly—to ensure that businesses can rise from the ashes and lead the nation’s economic recovery.

Independent institutions are the backbone of Nepal’s recovery

Nepal’s democratic experiment is at a crossroads. From courts to constitutional bodies, the bureaucracy, and even the security apparatus, state institutions are widely perceived as politicized, inefficient, and untrustworthy. Recent events, including the corruption case against former Prime Minister Madhav Kumar Nepal by the Commission for the Investigation of Abuse of Authority (CIAA), underscore the depth of the crisis. Public skepticism over the CIAA’s mandate—whether it can probe selective cabinet decisions—highlights a broader concern: institutions that should be impartial have become instruments of political maneuvering.

The CIAA’s credibility deficit is emblematic of a systemic problem with deeply engaged in political directions. Leadership appointments are often driven by political loyalty rather than competence. Commissioners beholden to party interests compromise investigations, selectively target “small fish,” and allow high-profile corruption to persist. Courts fare no better. Controversial verdicts, such as the acquittal of former lawmaker Mohammad Aftab Alam despite strong evidence, reinforce perceptions of bias. Meanwhile, delays in appointing key positions, like the Governor of Nepal Rastra Bank, reflect political bargaining at the highest level, further eroding confidence.

The executive branch, too, suffers from opacity and impunity. Ministers routinely delay disclosure of assets, and public trust is at an all-time low. Security institutions—the police, the army, and regulatory agencies—are similarly viewed as politicized. When oversight bodies, the judiciary, and regulatory authorities lose independence, governance suffers, and citizens’ faith in democracy diminishes.

Restoring credibility requires more than constitutional rhetoric; it demands systemic reform.

History suggests that reform must originate from political parties, yet these same actors often undermine institutional autonomy when their interests are threatened. From the early 1990s through post-2006 politics, parties from the CPN-UML to the Nepali Congress, Maoists, and Madhes-based factions have manipulated oversight mechanisms, weakening constitutional institutions. Even newer parties, such as the Rastriya Swatantra Party, publicly challenge investigations and court rulings when politically inconvenient. This entrenched pattern has left Nepalis cynical about the impartiality of state institutions.

Restoring credibility requires more than constitutional rhetoric; it demands systemic reform. The interim government has a critical window to lead. By overhauling appointment processes, ensuring merit-based selections, and safeguarding the independence of constitutional bodies, the state can rebuild trust. Judges, bureaucrats, and commissioners must operate free from partisan pressure, while security and regulatory agencies must enforce the law impartially.

Strengthening institutions is not an abstract exercise—it is the foundation for political stability, economic recovery, and social cohesion. Citizens cannot invest, innovate, or participate fully in governance if courts, commissions, and public agencies are viewed as extensions of political parties. The interim government’s priority must be to demonstrate that independent, credible institutions are achievable, even amid short-term political turmoil.

Nepal’s Constitution provides for separation of powers, but implementation lags. Immediate action is needed to institutionalize autonomy, transparency, and accountability across the board. Only then can the country restore public confidence, protect democratic norms, and ensure that its political system survives—and thrives—beyond the cycles of partisanship that have long defined its politics.

Prioritize expert-led constitutional reform

Nepal stands at a pivotal juncture in its political evolution. The 2015 Constitution, implemented alongside the 2017 elections for federal, provincial, and local governments, marked a historic step toward federalism and inclusive democracy. Yet, ten years on, its limitations have become evident. Inconsistent implementation, frequent shifts in power, and challenges in provincial authority underscore the need for a structured, expert-driven review.

The interim government has a unique opportunity to lead this process independently. Establishing a technical constitutional commission to examine the document’s provisions, identify structural gaps, and propose amendments is imperative. Such a body, comprising legal scholars, governance experts, and practitioners, could provide an impartial assessment, free from the influence of short-term political agendas. Its recommendations could then be submitted to a newly elected Parliament for broader deliberation, ensuring that amendments reflect national consensus rather than partisan interest.

Crucially, constitutional reform must align with effective representation to all necessary aspects.

Federalism remains the cornerstone of Nepal’s political architecture, yet its implementation has been uneven. Provinces struggle to exercise constitutionally mandated powers, such as policing, while coalition politics and shifting alliances have hindered accountability.

Electoral reforms, including recalibrating proportional representation and reducing the size of legislatures, could enhance governance efficiency. Direct elections for Prime Ministers and Chief Ministers, along with limits on ministerial positions and tenures, could foster stability and reduce corruption.

Crucially, constitutional reform must align with effective representation to all necessary aspects. Proportional representation for women, Dalits, and marginalized communities cannot be sacrificed in the pursuit of efficiency; instead, systems should be refined to ensure equitable and accountable participation. Similarly, streamlining federal ministries and departments could cut costs while empowering local governments.

Nepal’s experience contrasts sharply with stable federations such as the United States, Switzerland, Canada, and India, which have maintained continuity through periodic constitutional reforms and strong institutions. In Nepal, by contrast, political opportunism has often undermined systemic stability, eroding public trust. Only a structured, transparent, and technically informed process can restore confidence in governance.

The interim government’s role is therefore dual: it must ensure that constitutional review is rigorous and evidence-based, while simultaneously safeguarding the legitimacy of the electoral process. Once a new Parliament is elected, lawmakers can debate, refine, and enact amendments grounded in expert recommendations and broad consensus. This phased, deliberative approach would prevent hasty or politically motivated changes that could destabilize federalism.

Ultimately, constitutional reform is not merely a technical exercise; it is a commitment to the principles of federalism, accountability, and inclusive democracy. By establishing a technical commission and facilitating Parliament-led deliberation, Nepal can transform its constitution into a dynamic, living document—one that guides governance, strengthens institutions, and fulfills the aspirations of its citizens. The interim government must act decisively, balancing expertise, political dialogue, and public trust, to lay the foundation for a stable and prosperous Nepal.

Anti-corruption must be the priority

Nepal finds itself at a crossroads. The Gen Z protests have made it clear that rampant corruption is the public’s foremost grievance. Yet, decades of experience show that existing institutions, particularly the Commission for Investigation of Abuse of Authority (CIAA), cannot independently tackle this problem.

Deeply politicized, structurally compromised, and often beholden to party leaders, the CIAA lacks the autonomy, credibility, and capacity to pursue high-level cases without external guidance. Ordinary officials are prosecuted, but influential political figures and business elites remain untouched, reinforcing the perception of selective justice.

The interim government has a narrow window to act decisively. Public frustration with corruption is directly linked to stagnating development: incomplete road projects, delayed infrastructure, a faltering education system, and health services in disrepair.

Ultimately, anti-corruption is not merely a moral imperative—it is central to Nepal’s development, stability, and democracy.

Economic stagnation drives tens of thousands abroad monthly, eroding Nepal’s human capital. Meanwhile, high-profile scandals—from gold smuggling to the Ncell/Axiata sale and OMNI-COVID procurements—remain unresolved, leaving billions of rupees’ worth of accountability unaddressed.

Given these structural constraints, the government must leverage existing state mechanisms such as the Central Investigation Bureau (CIB) to initiate prompt, high-profile investigations. By targeting major corruption files and demonstrating tangible action, the interim administration can restore public confidence and signal that no one is above the law. Transparency in process is critical: public briefings, digitized case tracking, and timely updates will enhance legitimacy while shielding investigators from political pressure.

Partnerships with development partners and international institutions can also reinforce the credibility of anti-corruption measures. Technical support, digital governance tools, and multilateral oversight can strengthen the investigative process and ensure resources are used effectively. The interim government should position itself as a neutral arbiter, focused on systemic reform rather than political gain, ensuring that actions taken during this brief tenure set the stage for longer-term institutional integrity.

Ultimately, anti-corruption is not merely a moral imperative—it is central to Nepal’s development, stability, and democracy. The interim government must act swiftly, using the CIB and other capable agencies to open major cases, protect investigators from interference, and ensure accountability.

Failure to do so risks further erosion of public trust, undermining elections, devolution of power, and the nation’s democratic framework. A transparent, vigorous anti-corruption campaign now can provide both the Gen-Z generation and all citizens reason to believe in governance, while creating a foundation for sustainable development and resilient institutions for years to come.

Navigate geopolitics and handle diplomacy independently

The success of Nepal’s Gen-Z protests has unsettled the old political order, overturned entrenched hierarchies and challenged the status quo. While this marks a domestic victory for civic engagement, it coincides with a perilous moment in global geopolitics.

Nepal is enmeshed in the competitive orbit of great powers—Washington, Beijing, and New Delhi—each casting a long shadow over Kathmandu’s corridors of power. Observers, including foreign speculators, have hinted at external influence on the government, suggesting that missteps could exacerbate domestic instability.

For an interim administration, the stakes could not be higher: managing domestic reform while projecting independence in foreign policy demands both prudence and institutional capacity.

Nepal’s Ministry of Foreign Affairs (MoFA) is ill-equipped for this challenge. Its ten divisions, structured geographically rather than functionally, lack the personnel and expertise to analyze complex issues such as the US Indo-Pacific strategy or China’s Belt and Road Initiative.

Think-tanks such as the Institute of Foreign Affairs remain underutilized, and political appointees often dominate ambassadorial posts, undermining institutional memory and coherent strategy. The result is an ad hoc, personality-driven diplomacy where key decisions bypass MoFA, leaving both foreign relations and domestic credibility vulnerable.

In this environment, the interim government must prioritize institutional resilience.

Coordination across government is equally deficient. The Office of the Prime Minister and Council of Ministers frequently bypass MoFA in making foreign appointments or negotiating deals.

Security agencies, provincial authorities, and line ministries are insufficiently integrated into policy-making, creating fragmented, reactive governance. Meanwhile, domestic politics—amplified by coalition bargaining—further constrains the ability to take decisive, independent positions.

In this environment, the interim government must prioritize institutional resilience. Strengthening MoFA, professionalizing diplomatic appointments, and building analytical capacity are essential first steps.

Independent advisory bodies should feed timely insights into foreign policy, ensuring that domestic reforms, such as those demanded by Gen Z, are complemented by credible, neutral international engagement. At the same time, Kathmandu must balance relations carefully: avoiding overt alignment with any single power while leveraging global partnerships for development, investment, and security.

The lesson is clear: domestic upheaval cannot be allowed to compromise foreign policy. Geopolitical mismanagement risks not only external censure but internal destabilization.

By professionalizing its diplomacy, strengthening inter-agency coordination, and asserting an independent voice, Nepal can navigate global tensions while consolidating domestic reform. In a world of fast-moving crises—from the Russia-Ukraine conflict to US-China rivalry—the interim government’s credibility, and Nepal’s long-term sovereignty, will hinge on its capacity to marry internal renewal with judicious, impartial international engagement.