Nepal navigates political shifts and economic recovery after Gen Z protests

Nepal is navigating the political and economic aftermath of the Gen Z-led protests that occurred in September 2025. The unrest, which saw 77 deaths and widespread vandalism, led to the collapse of the KP Sharma Oli government and the dissolution of Parliament. An interim administration led by former Chief Justice Sushila Karki stabilized the country and oversaw elections that resulted in a near two-thirds majority for the Rastriya Swatantra Party (RSP).

While the new government under Prime Minister Balendra Shah has addressed immediate crises through agreements on governance and victim relief, critics argue that deep-seated political culture issues remain.

Economically, the hospitality sector is working to recover from losses estimated at Rs 25 billion after dozens of hotels were damaged or burned. The Hotel Association Nepal reports that while many establishments are rebuilding or have resumed operations, some major properties, such as the Hilton, face delays in reconstruction due to pending insurance claims.