Nepal calls November election as economy stumbles

Nepal's government said on Thursday it will hold a parliamentary election on 20 November amid concerns over high inflation and depleted foreign exchange reserves that have led to rising food and energy prices.

Education Minister Debendra Paudel confirmed that a cabinet meeting had approved the date for the election to the 275-member House of Representatives – 165 seats on first-past-the-post basis and the rest through proportional representation.

An alliance of communists including former Maoist rebels and the centrist Nepali Congress party of Prime Minister Sher Bahadur Deuba has held power since July last year. Former Prime Minister K.P.Sharma Oli's Communist UML party, considered closer to Beijing, is the main opposition.

Nepal has seen 10 governments change since 239-year-old monarchy was abolished in 2008.

Deuba, 76, has been prime minister five times and says astrologers have told him that he would hold the office two more times.

But analyst Krishna Khanal says voters are tired of revolving door governments. They are looking for change and seeking younger leaders to head the government.

There are no popularity surveys of political parties but the general perception of major parties and senior politicians is low due to their incompetence and non-performance, some analysts said.

"I don't think I will vote for any major parties that have alternated in power but failed to do anything to alleviate the sufferings of the people," said Rabindra Kasaju, a 45-year-old farmer in the outskirts of Kathmandu.

Khanal, who taught political science at Nepal's Trivhuvan University, said the outcome of recent local elections, including in the capital Kathmandu where independent non-political youths were elected, showed people's desire for change.

"If political parties fail to see the writing on the wall even their senior leaders would have hard time to win," Khanal told Reuters.

Nepal's economic woes will also be high in voters' thinking. The country witnessed annual retail inflation of 8.56% in June, the highest for nearly six years.

Foreign exchange reserves have declined to near $9 billion, barely sufficient to cover imports for about six months, from near $12 billion a year earlier, according to latest central bank data.

In the municipal assemblies in May, Deuba's Nepali Congress won slightly more assemblies than the UML party.

Elections to seven state assemblies, set up under the first post-monarchy constitution adopted in 2015, aimed at cementing a federal system, will be held at the same time, Paudel told Reuters.

Political developments in Nepal are closely watched by neighboring giants China and India, who jostle for influence and have poured billions of dollars in aid and investment in infrastructure.