The last leg of local elections held in Province-2 on September 18 was very successful in that it was held in a relatively peaceful environment with a massive turnout (77 percent) of voters, which is also the highest among all the three phases of local polls. Expectedly, CPN-UML, which remained at the top in the previous phases of local polls, did not do well and remained well behind its major rival party (NC) at number 5.Despite being at the top in Province-2, the NC stalwarts, with only 40 seats in their bag and mayoral electoral defeat in important places like Birgunj and Janakpur, could not get into a celebration mood. They were also unhappy that their wish of making up the loss suffered in the earlier two phases by winning 75 percent of the seats in Province-2 could not be actualized and NC had to be behind UML in the total provincial count. The Election Commission (EC) and Nepal government, more specifically, Prime Minister Sher Bahadur Deuba, must have been happy that the much debated election was over peacefully and the controversial decision to postpone election in this province was not wrong. Little bit of happiness that a relieved Deuba may have shared with his associates, however, did not last long as the news of unification of the three parties- CPN UML, CPN (Maoist Center) and Naya Shakti Party was made public on October 3.It may be mentioned that in a dramatic turn of events, the chiefs of three left political parties announced that their parties will forge an electoral alliance to contest the upcoming elections for parliament and the provincial assemblies as their first joint task. The three leaders also inked a six-point deal on forging an electoral alliance, forming committees and task-forces to finalize the unification, preparing a joint manifesto for upcoming elections, preparing a party statute ad other documents, and not trading blame in the transitional period, among other things. Although those close to the three parties claim that the leftist alliance was long in the making with Bamdev Gautam as a mediator and close confidant of the two chairmen (Oli and Prachanda) until the deal was struck, this announcement, which came just a month ahead of provincial assembly and parliamentary elections, has left the ruling party scrambling.NC leaders are holding meetings, both intra and inter party, at various levels and have concluded that the step taken by the Maoist Centre is unethical and in breach of a previous electoral alliance understanding with NC. It is difficult to disagree with the opinion of some NC leaders that the Centre’s decision to forge alliance with the main opposition without withdrawing support to the government is politically unethical but the matter to be noted seriously is whether values and ethics still have any space in our politics? The answer definitely is a big No! Therefore, small wonder smart players like Prachanda are often seen outsmarting both collaborators and rivals alike, depending on the situation. In the face of electoral debacles and the eroding image of his party, he is often seen taking resort to these kind of political manoeuvers to keep himself and his party up and alive. Prachanda must have seen expected benefits from this alliance outweighing the benefit being reaped from the current arrangement with NC. It was a well calculated move and no amount of efforts from NC could stop Prachanda from getting into this arrangement. Deuba did everything humanly possible to keep coalition partners, especially Maoist Center, in good humour, adding ministers at their will to make his Cabinet the largest ever in Nepal’s history with 56 members in it. He also conceded many other demands of the coalition partners, at times even at the cost of annoying his senior partners in the party. He took the criticism, both at home and abroad, on the size of government with a pinch of salt. His interaction with students at Columbia, while in the United States to attend the UN general assembly, was interesting, which touched upon the size issue as well. Indeed, Deuba did everything possible not to let Prachanda run away from him. It was not a bolt from the blue. The NC leaders are free to say that this sudden political development has pushed the country towards polarization but fact of the matter is that they are left with no choice but to form an alliance of the like-minded party to contest the remaining elections at the federal and province level, which could be affected as the possibility of a cabinet reshuffle by Deuba to drop Ministers representing the Maoist Centre or moving a no-confidence motion against the government by the duo (Oli\Prachanda) is wide open. More than anything else the two blocks are currently engaged in wooing parties to get majority of lawmaker on their side. Somewhat forced into the task of forming an alliance, NC has accelerated consultations with different parties of which the Sanghiya Samjbadi Forum-Nepal (SSF-N) and the Rastriya Janata Party-Nepal (RJP-N) are the noted ones. It may be recalled that the SSF-N and RJP-N bagged 26 and 25 wins, securing number 2 and 3 positions respectively in Province-2 local polls. Prime Minister Deuba held discussion even with Rastriya Parjatantra Party (RPP) chair Kamal Thapa who had accused the Deuba-led government of engineering the vertical split in his party leading to the creation of RPP led By Pashupati Rana. While RJP-N is said not to be in consultation with the left alliance, Upendra Yadav-led SSF-N is reported to be in regular contact with the left leaders. While both sides are trying hard to bring the SSF-N into their fold, the two Madhesh-based parties have formed an electoral alliance for the federal and provincial polls which could dent the ruling NC’s plan to form a democratic alliance to counter the recent left initiative. The SSF-N and the RJP-N have announced that they would contest the polls, scheduled for November 26 and December 7, jointly. It is interesting that these two parties were said to be making necessary preparations to join the NC-led alliance and had even participated in a meeting to discuss matters with NC just one day after the news of left alliance was made public. These two parties have, however, not yet closed the door on NC because they have made it clear that any alliance with other political parties and fronts will be forged jointly. In the present context, it is likely that these two parties will choose NC-led alliance if they decide to go for a broader alliance.NC is still in talks with like-minded parties and is not likely to reach any conclusion soon on division of First-Past-the Post constituencies, despite the urgency to form an alliance to counter the challenges posed by the left alliance. Yadav and Thakur have demanded 57 out of the165 parliamentary positions and they want 24 positions in Province-2 alone, leaving NC and other parties in discussion with only 8 seats. Their order is no less tall in case of allocations related to provincial elections. Despite the difficult demand, NC cannot show them the door because the NC stalwarts know very well that any alliance formed without the two Madhes-based parties in it would be meaningless from the standpoint of provincial and parliamentary elections because other parties showing interest to cooperate may not be able to help themselves, let alone being of any help to Deuba-led NC.Yadav and Thakur have the advantage of bargaining with NC from a position of strength because they know well that if what happened in Province-2 local elections could be extended to other parts of Madhes, the two parties together can emerge as a post-election major political force capable enough to bargain for the top executive post of the country. Deuba and his associates have to realize that their party is little bit awkwardly placed after the formation of the left alliance and also runs the risk of being isolated without any mention-worthy alliance partner for the elections. Let us see how NC handles the difficult and delicate situation that it is in currently.

In the ongoing struggle for power, major parties will have to make sure that their activities in no way affect the planned federal and provincial elections. In this context, the Election Commission is right in urging the political parties, government and other stakeholders not to indulge in activities that could affect the elections. Prachanda is quoted saying repeatedly that his party does not intend to topple the government despite the new political development but has also made it clear lately that his party would quit the government should Prime Minister Deuba decide so. If the prevailing election environment is not to be disturbed, it would be wise for Deuba not to listen to the advice of some NC leaders that the ministers representing the Maoist Centre should be removed. It would be wise to keep the Cabinet untouched until the elections are over because the en block ouster is bound to invite immediate retaliatory move by the left alliance making the situation more instable. A recent decision by RPP to extend support to the government, however, has increased the chance of a reshuffle very soon. It is interesting that RPP decided to extend support exactly two months after it quit this government. In the fast changing political scenario, NC, instead of accusing the left alliance as being against national unity and democratic system and could affect constitution implementation and the peace process, should accept the political challenge positively and prepare itself for the uphill political battle with the powerful-looking left alliance. Thanks to the political development, NC seems to be trying to unite in a genuine way and the criticism of Deuba’s observations made at different fora, both within and outside of Nepal, has also subsided. Let us now talk a bit about the attention-seeking economy.

Expectedly, the World Bank (WB) has revised downward Nepal’s economic growth forecast for the current fiscal year at 4.5 percent. It had previously stated that Nepal would grow by 5 percent in the year which began on July 16.The Asian Development Bank(ADB) also agrees that the growth rate will decline to less than 5(4.5 to 4.7) percent this year.  These forecasts are way lower than the government’s estimate of 7.2 percent. The recent floods have been cited as the major culprit, which has affected over 80 percent of land in Southern Tarai, Nepal’s food basket. Crops grown on 64000 hectares are reported to have been destroyed, which will lead to a notable decline in agricultural output this fiscal year. The multilateral body also expects activities in many sectors to be affected by political uncertainty. Services will continue to remain the main driver of growth but will grow more slowly than in previous years. Capital expenditure stands at Rs.4.91 billion in the first two months of the current fiscal year and may decelerate in days to come basically on account of the likely heavy engagement of the concerned in  election related activities, which will check both development activities and expenditure. Revenue has also not grown satisfactorily in the first two months of the current fiscal. We can simply wish government success in realizing its recent claim that the high growth rate of last fiscal year can be achieved this fiscal too. In the meanwhile, authorities at our central bank must be happy that Inflation has dipped to a twelve-year low at a time when even massive election-related unproductive expenses would not be able to push it too high. May Lord Pashupatinath continue to save us!