'Resignation of the Prime Minister' - the much awaited demand of the Unified Communist Party of Nepal-Maoist (UCPN-Maoist) was finally fulfilled on June 30, when Prime Minister Madhev Kumar Nepal submitted his resignation letter to the President, Ram Baran Yadav. The President in turn provided his consent to the resignation letter on the very same day, and asked the political parties to form a consensus government within seven days. Today is the last day for formation of the new government; and yet none of the political parties have yet reached for agreement on the consensus government.

On the one hand, the UCPN (Maoist) is claiming that the consensus government should be under its leadership on the grounds that it is the largest party in the Constituent Assembly (CA). On the other hand, the other two political parties, the Nepali Congress (NC) and the Communist Party of Nepal-Unified Marxist and Leninist (CPN-UML) oppose the demands of the UCPN (Maoist), saying that the first point from the May 28 three-point agreement between the three major political parties has not been implemented by the Maoist side. The first point of the agreement is about the remaining tasks of peace process, including the integration and management of the Maoist's combatants.

CPN-UML is on the view that it has to lead the new government, claiming that NC has the President and Chairperson of the CA constitutional committee, while the UCPN (Maoist) has combatants under its control. Most of the CPN-UML leaders claim that in keeping its own military, the UCPN (Maoist) can't lead the new government. Therefore, they are asserting that their party has to lead the new consensus government if it is to happen. If the consensus government can't be formed, the CPN-UML has to form the majority government under its leadership. Some of the leaders are suggesting that the party has to request that the president extends the time for formation of the consensus government, and also allows for the current caretaker government until the new government is formed.

It seems that NC leaders are reluctant to lead the new government until the party's general convention, scheduled to be held in August. Some of the leaders are suggesting that NC does not have to take the government's leadership, arguing that it will affect the result of the party's leadership, that has to be elected by the convention. Other leading NC figures are demanding that the NC gets leadership of the new government, since we have already experienced two parties leadership of the government, and those were UCPN (Maoist) and CPN-UML. They are claiming that it is now the turn of the NC.

All this means that, already over a month since the extension of the term of the Constituent Assembly, not a single step of progress has been made in the Nepal Peace Process. The time limit for the formation of a consensus government looks likely to end today without success. This will leave only the possibility of another majority government to follow on from the two failed majority governments of the past two years. This leaves the future of the peace process and constitution writing very uncertain indeed.

Ambika Pokhrel, Nepal Local Correspondent, 7 July 2010