Despite promises that a reshuffle in the Oli administration will be “based on merit, system and performance”, the prime minister on Wednesday effected a minor rejig in his Cabinet which smacked of internal political maneuverings.

The changes included removal of Ishwar Pokhrel as the defence minister and inclusion of Bishnu Poudel as the finance minister.

Prime Minister KP Sharma Oli has kept the Defence Ministry portfolio with himself. The Finance Ministry, which was with Oli since Yubaraj Khatiwada resigned earlier this month, has been given to Poudel, who is also the general secretary of the ruling Nepal Communist Party (NCP). The Ministry of Communication and Information Technology has been given to Parbat Gurung, who was minister for children, women and senior citizens.

The finance portfolio for Poudel, according to insiders, is a reward for the role he played in settling the dispute that had emerged over the name and capital of Province 5 earlier this week. Poudel took the risk of antagonising the regional leaders and gave up on his demand for declaring Butwal the provincial capital as he sided with his boss Oli on declaring Deukhuri as the capital of the province that has been named Lumbini.

Sources in the party say Poudel pulled off a coup, as he has not only earned an important ministerial berth but also managed to slight Pokhrel, his competitor in the party.

Pokhrel, who was not happy with the leadership for elevating Poudel to the powerful post of general secretary, had agreed to lead the Defence Ministry after he was left with no option, according to ruling party leaders.

Pokhrel has been given the charge of the Prime Minister’s Office.

At least two knowledgeable sources told the Post that removing Pokhrel as the defence minister is largely guided by his “not-so-good” relations with the Army chief Purna Chandra Thapa.

According to the sources, Pokhrel did not share cordial relations with Thapa for quite some time. The Army chief was especially not happy when the national defence force was dragged into controversy over the procurement of medical equipment to fight Covid-19.

Pokhrel also faces criticism for failing to handle the Covid-19 pandemic as the coordinator of the High-level Covid-19 Crisis Management Centre. He also faces corruption allegations in the medical equipment procurement.

Leaders close to Oli, however, ruled out any differences between Pokhrel and Thapa and they defended the move to take Pokhrel to the Prime Minister's Office.

“Actually, Pokhrel wanted to look after the PMO since the very beginning. It was at the prime minister’s request that he had agreed to lead the Defence Ministry,” said Surya Thapa, Oli’s press adviser.

“Since the prime minister felt the need to have someone to look after the PMO to coordinate among various departments under it and the ministries, Pokhrel has been given the responsibility.”

According to Thapa, with at least five secretaries at the PMO, it makes a combination of four-five ministries.

But in the Cabinet system Nepal follows, many say, asking Pokhrel to look after the PMO means he is effectively a “minister without portfolio”, a massive relegation from his earlier position.

This episode may set in motion a new series of events in the party which is mired in factional feud, according to insiders.

A Standing Committee member said Wednesday’s reshuffle is likely to create more conflict in the party.

“Poudel cannot handle the Finance Ministry, let alone his dual duty as he is also the party general secretary,” said the Standing Committee member who was one of the members of the task force formed by the two chairs to defuse the crisis that had led the party towards a split. “The situation once again is returning to the stage prior to September 11. Conflicts will reappear now.”

With Poudel’s inclusion in the Cabinet, many say chances are Shanker Pokhrel, chief minister of Lumbini, could be brought to Kathmandu to look after party affairs. Shanker Pokhrel, who is also a Standing Committee member, is said to be the leader whom Oli trusts the most.

The other faces in the Cabinet include Krishna Gopal Shrestha as the minister for Urban Development and Lilanath Shrestha as the minister for women, children and senior citizens.

Krishna Gopal Shrestha had once switched sides to Nepal briefly. He has been rewarded for glorifying Oli, according to insiders. Lilanath Shrestha had contested against Pushpa Kamal Dahal from Siraha Constituency 5 in the 2013 Constituent Assembly elections from then CPN-UML but had lost by a small margin. Shrestha and Raghubir Mahaseth are the only two leaders who won the elections for former UML in Province 2.

Even though party chairmen Oli and Dahal held a two-hour-long meeting on Wednesday, leaders say the latter is not happy with the Cabinet reshuffle.

“Dahal is not happy with the prime minister’s move,” said a leader close to Dahal. “He has been trying to convince Oli for a Cabinet reshuffle as per the spirit of the recent decisions of party meetings.”

Dahal had long been pressing Oli to recall all ministers and make fresh appointments based on merit and performance. Insiders, however, say that the demand stemmed from his desire to remove Ram Bahadur Thapa, the home minister, and Lekhraj Bhatta, the industry minister.

Both Thapa and Bhatta were Dahal’s long time allies but they appear to have sided with Oli of late.

A member of Dahal’s secretariat said the party chair is not happy with Cabinet reshuffles in instalments.

“Oli did not even discuss his plan to rejing the Cabinet,” the member told the Post on condition of anonymity. “A decision to reshuffle the Cabinet must have been taken in line with the decision of the Standing Committee meeting and recommendations of the task force led by Poudel.”

The Madhav Nepal faction too has its reservations about Wednesday’s Cabinet reshuffle.

“Oli’s unilateral decision to induct three ministers is unacceptable to us,” a Standing Committee member close to Nepal told the Post. “Oli has once again breached the party understanding.”

Nepal, according to the leader, had recommended Yagya Raj Sunuwar for the Urban Development Ministry.

“Both Dahal and Nepal have decided to call a meeting of the party Secretariat to discuss Oli’s unilateral move,” he said.