As the KP Sharma Oli-led government completes its first year in office on Monday, the optimism seen during its formation has been overshadowed by a string of unfulfilled commitments, stalled reforms, and growing public discontent.

It was one of the rare instances in Nepal that the two largest political parties—the Nepali Congress and the CPN-UML—with historical rivalry and pole-opposite ideologies, joined hands to run the government citing extraordinary circumstances in the country.

Yet the government’s performance over the past year is marked more by inertia than impact.

Oli became prime minister after Pushpa Kamal Dahal failed to secure the House's confidence in the June 12 floor test last year. President Ramchandra Paudel called upon parties to form a new government under Article 76 (2) of the constitution.

In an unusual political compromise, major competitors Congress and UML came together under a seven-point deal to bring out major reforms in governance.

One of the major promises was constitutional amendments to fix structural flaws in the electoral system and a renewed drive towards good governance.

A year later, these commitments remain largely unfulfilled.

The seven-point agreement, presented as the coalition’s major directive, has proven to be little more than a paper pact. The promised constitutional amendments to address “electoral and governance anomalies” have seen no progress.

Even a section of leaders from the ruling Congress party seem dissatisfied with the government’s functioning.

Several leaders from the largest party, during a recently concluded central working committee meeting, raised serious questions about the government’s failure to work as per the two-party agreement.

While many Congress leaders are critical of the government's functioning, top leaders at the UML’s central secretariat meeting on June 25 reviewed the Oli-led government's one year in office and deemed it ‘satisfactory’.

Political observers, however, view the government as a failure in delivering on its promises even with an overwhelming majority in the House of Representatives.

The coalition’s promise of good governance has faltered, said Chandra Dev Bhata, a political analyst. “Public frustration has grown over the administration’s inability to curb corruption, another central pledge of the seven-point deal.”

Investigations on corruption have stalled, accountability has eroded, and the perception of impunity has only deepened, he added.

The government’s foreign policy record has drawn criticism, particularly in managing Nepal’s delicate relationships with India and China. Relations with India remain below average, with no substantial diplomatic reset despite high-level meetings. The prime minister’s visit to India has not taken place in a year.

On the other hand, the much-publicised Belt and Road Initiative (BRI) implementation agreement signed during Prime Minister Oli’s visit to China in December last year has yet to be implemented.

Bhatta said the inaction suggests a gap between foreign commitments and domestic action.

Domestically, the Oli government has been embroiled in controversy. The decision to remove Kulman Ghising, the widely popular head of the Nepal Electricity Authority (NEA), triggered widespread backlash and raised concerns about political interference in public utilities.

But Mahesh Bartaula, the chief whip of UML, claims that despite criticisms, the government performed above average. Arguing that the ruling coalition has its inherent difficulties, Bartaula said there has been political stability.

For him, the country’s economy has been lifted. Last year, the government functioned under the budget brought by its predecessor. The main efficiency of this supposedly strong government will be tested during the implementation of the budget for the upcoming fiscal year.

With a stable government, the investment climate has become favourable, and foreign direct investment is coming, Bartaula said. “The investigative agencies have got a freehand, which has enabled them to probe individuals without care for the portfolios they held.”

The government attempted to introduce policy through ordinances. However, these efforts have done little to solve pressing governance issues. A case in point is the Cooperative Ordinance introduced in December, which proposed a National Cooperative Regulatory Authority to address the grievances of cooperative victims. Right since its formation, the authority has remained dysfunctional as the government has failed to appoint its chief and expert members.

The year was also beset by protests. One of the most significant challenges was teachers’ protest in April, led by the Nepal Teachers’ Federation (NTF). Teachers demanded job security, better pay and benefits, inclusion in social security, and a new School Education Bill that respects prior agreements and decentralises teacher management in a justified manner.

The strike caused massive disruptions to public schooling, delaying the academic calendar, postponing national exams, and stalling admissions across the country. After intense negotiations, the government and teachers reached a nine-point agreement on April 30, with commitments such as subsidised healthcare for teachers, sick leave provisions, and a promise to pass the bill by June 29.

However, despite this promise, the government has failed to pass the education bill, leaving teachers frustrated and doubting the government’s commitment to reform.

A royalist protest on March 28, organised by pro-monarchy groups, escalated into deadly clashes and widespread arson, resulting in the deaths of two people and damage to millions of rupees worth of public and private property.

The government faced heavy criticism for its inadequate response to the riots. The unrest was fuelled by disillusioned youths frustrated by what they perceived as ineffective governance.

The government has been embroiled in a visit visa scam, with Home Minister Ramesh Lekhak’s questionable oversight.

Despite opposition demand, particularly from the Rastriya Swatantra Party, for a parliamentary probe into the scandal, the government has largely ignored calls for accountability.

In an apparent attempt to address governance issues, Prime Minister Oli constituted a 15-member High-Level Governance Reform Recommendation Commission—also known as the Good Governance Commission—on April 21, with himself at the helm. Yet, the commission has convened only once since its inception, and the Prime Minister’s Office has yet to publish property details of the Cabinet members, raising questions about the government’s commitment to transparency.

On a positive note, instability in provincial governments during weaker coalitions previously has been curtailed under the current Congress-UML coalition, said Khimlal Devkota, an expert on federalism.

“Previously, even minor shifts in the central coalition led to the toppling of provincial governments, but this trend has been halted, providing some stability at the provincial level,” he added.

“However, the good governance that a strong majority government should have delivered under the federal structure has remained weak.”