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Sudan Gurung announced his resignation as Nepal’s home minister on April 22, 2026, citing moral responsibility and the need for public trust amid unanswered questions about his investments. The move marks the second ministerial exit in a month for Prime Minister Balendra Shah’s administration, which came to power on a platform of sweeping anti‑corruption reforms. Key Developments Sudan Gurung steps down, effective immediately, after less than a month in office (took office on March 27). Prime Minister Balendra Shah assumes interim charge of the Home Affairs portfolio. The resignation follows the dismissal of the labour minister over nepotism allegations. A five‑member commission, led by a former Supreme Court judge, is investigating assets of politicians and officials. Nepal ranks 109th out of 180 on Transparency International’s Corruption Perceptions Index. Data & Market Impact Transparency ranking of 109th signals a perception of high corruption, which can deter foreign direct investment (FDI) and tourism—sectors that contributed roughly 12% of GDP in 2025. Political volatility, evidenced by two cabinet exits in 30 days, has historically correlated with a 3‑5% short‑term dip in the Nepalese rupee against the US dollar. The anti‑corruption commission’s findings could trigger asset freezes or legal actions affecting senior business figures linked to the ruling Rastriya Swatantra Party (RSP). Why This Matters Governance credibility: Repeated resignations erode public confidence in the Shah government’s promise of clean governance. Reform momentum: The RSP’s 100‑point reform agenda hinges on delivering tangible anti‑corruption results; setbacks risk alienating its reform‑seeking voter base. Regional stability: Nepal’s political turbulence can affect cross‑border trade with India and China, especially in the Himalayan logistics corridor. Investor perception: Ongoing investigations and cabinet churn may prompt investors to reassess risk premiums, potentially slowing upcoming infrastructure projects. Expert Insight The resignation reflects a strategic calculus by Gurung to pre‑empt a protracted scandal that could implicate senior RSP figures. By stepping down voluntarily, he frames the narrative around “morality” rather than “guilt,” limiting immediate political damage to the coalition. However, the pattern of rapid ministerial turnover suggests deeper institutional weaknesses: the newly formed government lacks a seasoned bureaucratic backbone to weather scrutiny, and the aggressive asset‑probe commission may be over‑reaching, creating a climate of uncertainty for both politicians and business leaders. What Happens Next Interim leadership: Prime Minister Balendra Shah will manage Home Affairs until a successor is appointed, likely after internal RSP consultations. Cabinet reshuffle: Expect a broader reshuffle within the next two weeks to restore confidence and fill the vacuum left by the labour minister’s earlier dismissal. Commission outcomes: The asset‑investigation commission is slated to release an interim report by early June; adverse findings could trigger further resignations or legal actions. Policy continuity: If the RSP can retain its reform agenda, it may accelerate anti‑corruption legislation, which could improve Nepal’s CPI ranking and attract modest FDI inflows by 2027.

Nepal's police have arrested former Prime Minister KP Sharma Oli and ex-Home Affairs Minister Ramesh Lekhak over their alleged involvement in a deadly crackdown on protesters last year.The detentions on Saturday came a day after Prime Minister Balendra Shah and his cabinet were sworn in after the first elections since the 2025 uprising that toppled Oli's government.According to The Kathmandu Post, Oli, 74, was taken into custody from his residence in Bhaktapur, a suburb of the capital, Kathmandu. Images later showed Oli walking into a hospital, dressed all in white, and surrounded by police officers.Lekhak was also detained on Saturday from another area of Bhaktapur, his personal secretary Janak Bhatta told the Post.In a statement on Facebook, new Home Minister Sudan Gurung wrote, "promise is a promise: No one is above the law"."This is not vengeance against anyone, it is simply the beginning of justice. I believe the country is now headed in a new direction," said Gurung.Oli has yet to issue a statement regarding the arrest.At least 77 people were killed in the anticorruption uprising on September 8-9, 2025, which began over a brief social media ban but tapped into longstanding fury over economic hardship.At least 19 young people were killed in the crackdown on the first day of protests.The demonstrations spread nationwide the following day as parliament and government offices were set ablaze, resulting in the government's collapse.During the caretaker administration, a government-backed commission into the deadly uprising recommended the prosecution of Oli and other senior officials.Its report said it was "not established that there was an order to shoot", but said "no effort was made to stop or control the firing and, due to their negligent conduct, even minors lost their lives".Oli has previously denied ordering security forces to open fire on protesters. During his failed bid for re-election in the March 5 poll, he blamed "infiltrators" for the violence.Prime Minister Shah, 35, a rapper-turned-politician, and his Rastriya Swatantra Party (RSP) won a landslide victory in parliamentary elections this month on a platform of youth-driven political change.Shah challenged and defeated Oli in the four-time ex-prime minister's own constituency.At Shah's first cabinet meeting on Friday, it was decided to implement the recommendations made by the investigative commission.