In a dramatic turn of events, Nepal’s political landscape has shifted yet again, with the appointment of Sushila Karki as the country’s interim Prime Minister. 

A former chief justice with a reputation for integrity and political neutrality, Karki now faces the daunting task of steering a deeply polarized nation toward stability, democratic consolidation, and a peaceful electoral transition in 2026. 

Her premiership carries profound implications—not only for Nepal’s fragile domestic order but also for regional geopolitics, especially concerning India’s strategic interests in the Himalayan republic.

Sushila Karki’s ascendance follows weeks of intense political unrest that culminated in the resignation of KP Sharma Oli and widespread Gen Z-led protests.

These demonstrations were driven by a profound sense of disillusionment with the entrenched political establishment, economic stagnation typified by over 20 per cent unemployment among young people, and governance failures which included a string of well publicised scams. 

The movement represented a generational reckoning, demanding systemic reforms and rejecting the inertia of traditional political elites.

Involvement of Gen Z

Karki’s government is deliberately positioned as a caretaker entity with limited ambition but significant responsibility: dissolve the House of Representatives, restore order, and prepare the country for elections scheduled for March 2026. 

Her decision to keep the cabinet lean, restricting it to under 15 ministers despite having the legal authority to fill all 25 slots, shows a conscious desire to break from the past culture of political patronage and corruption. 

This modest approach resonates strongly with the ethos of the Gen Z movement, which demands accountability, transparency, and simplicity

 Unlike past leaders who largely dismissed or sidelined protest movements, Karki has actively sought the input of Gen Z activists, conducting consultations both in person and through digital platforms such as Discord. 

Her visits to hospitals treating injured protesters underscore a political strategy that is as much about optics as substance: signalling empathy and recognising the sacrifices of youth who catalysed the political upheaval.

Yet, the Gen Z movement itself remains at a crossroads. Groups like Hami Nepal, while influential in mobilizing street action, have resolutely refused direct participation in the government. 

Their insistence on remaining outside the cabinet reflects a deep wariness of political co-option and a desire to maintain independence from the old political order. This raises questions about their ability to sustain influence in the long term.

 Will they transform into a formal political force contesting the 2026 elections, or will they struggle to maintain relevance, potentially splintering into disillusioned factions?

The Army’s Shadow

Beneath the surface of this political realignment lies a more troubling undercurrent: the army’s role in shaping Nepal’s future. 

Historically a key player in Nepali power struggles, the military now appears to be caught in its own dilemma. 

Royalist elements within the army view the current political instability as a unique opportunity to resurrect constitutional monarchy. 

Their belief is that the republican experiment has failed to deliver stability or economic progress, and that the monarchy, if carefully reintroduced, could provide the necessary order.

However, former King Gyanendra’s reluctance to reclaim the throne without a democratic mandate signals internal friction within royalist circles. 

Reports suggest that he is unwilling to accept the crown unless offered either by a national referendum or a parliamentary vote, complicating royalist ambitions. 

Choice of Governance

Meanwhile, younger generations of Nepalis, represented by the Gen Z movement, are unequivocal in demanding jobs, economic reforms, and an accountable government. 

Vocal sections of them view mere introduction of monarchy without significant and meaningful reforms in the governance structure would not grant them the change they yearn for.

This tension adds another layer of complexity to Nepal’s political trajectory. 

The next election will hence not merely be a choice between political parties but a referendum on the very future of Nepali governance. 

The competing forces — royalists hoping to leverage the army’s influence, Gen Z activists seeking systemic change, and the old guard striving to survive — will be locked in a precarious power struggle with the constitutional order hanging in the balance.

India’s Strategic Opportunity

Karki’s tenure is set against a broader geopolitical contest unfolding in Kathmandu, where India, China, and global powers subtly vie for influence.  Her personal and educational ties to India provide a distinct advantage for New Delhi. 

Having earned a master’s degree at Banaras Hindu University and built personal relationships with Indian intellectuals, Karki speaks warmly of her time in India, describing Indian leaders as “family” and herself as a “friend of India.”

In this context, India’s reaction to her appointment has been both swift and supportive. Prime Minister Narendra Modi and the Indian External Affairs Ministry welcomed her elevation, framing it as a step toward democratic stability in Nepal. 

This marks a diplomatic win for India, particularly after the recent tensions triggered by Oli’s nationalist rhetoric and political overtures toward Beijing.

For India, the Karki government presents an opportunity to recalibrate bilateral ties toward constructive engagement. Her pragmatic stance and reputation for political neutrality suggest a focus on restoring cross-border trade, addressing migrant labor concerns, and easing long-standing disputes over security and connectivity. 

In an environment where China has remained largely silent, India’s embrace of Karki signals its confidence in sustaining influence through soft power and personal diplomacy.

Limited Mandate 

Karki’s mandate, however, is inherently limited. Her primary role is to stabilize the polity and conduct free and fair elections. Major policy shifts or structural reforms are unlikely, as her interim status precludes bold initiatives. 

Yet, her presence offers India a reliable interlocutor capable of managing bilateral tensions and ensuring that unresolved issues, such as border disputes or transit rights, do not escalate into larger crises

As a roadmap through a layered situation, the stakes of the forthcoming elections could hardly be higher. More than a mechanism to replace the instability of the Communist-led government under Oli, the next ballot will likely redefine Nepal’s political identity. 

It is expected to address fundamental questions: Should Nepal continue its democratic experiment or will royalist forces attempt a comeback under the guise of stability? 

It will also pose the existentialist question: Can Nepal’s so-called Gen Z activists led by disparate groups like Hami Nepal translate street power into political legitimacy without sacrificing their ideals?

President Ramchandra Poudel’s call for calm and cooperation underscores the constitutional framework’s fragility. The peaceful resolution of the current crisis offers hope, but the path remains riddled with risks. 

The army’s protective custody of opposition leaders and the opaque deliberations within royalist circles hint at the unresolved power plays that could erupt if political compromise falters.

For the Indian government, the interim Karki administration offers a valuable interlocutor who understands both the cultural and strategic sensitivities of bilateral relations. Supporting her government’s limited but crucial agenda aligns with New Delhi’s interest in maintaining regional stability, securing cross-border trade, and containing potential Chinese inroads into Nepal’s political and economic life.

The next six months are not simply a countdown to an election — they are a test of Nepal’s capacity to reconcile its past, energise its present, and define its future. The world will be watching as this Himalayan nation, perched between Asian giants, tries to emerge from a political crisis into democratic renewal.

(The writer is a senior Indian journalist and geopolitical analyst. Views expressed are personal)