Kathmandu, Jul 3: Nepali Congress president Sher Bahadur Deuba Wednesday asked Prime Minister Pushpa Kamal Dahal 'Prachanda' to resign and pave the way for the formation of a new government, as the ruling coalition partner CPN-UML withdrew support after a power-sharing deal with the largest party to oust the former guerrilla leader.

"The Prime Minister should resign after the largest parties NC and UML said that they would form a new government together," Deuba told reporters after a crucial meeting of the party at his residence at Budhanilkantha on the outskirts of Kathmandu.

Deuba, 78, and Communist Party of Nepal-Unified Marxist Leninist (CPN-UML) chairman K P Sharma Oli, 72, - both former premiers - inked a power-sharing deal Monday night to form a new government. They agreed to share the Prime Ministerial position on a rotation basis for the rest of the term of the Parliament.

Meanwhile, the largest party in the ruling coalition - CPN-UML - withdrew support to Prime Minister Prachanda-led government.

"Our party has withdrawn support to the government," said Bishnu Rijal, deputy chief of UML's publicity committee.

The CPN-UML has eight ministers in the Prachanda Cabinet, including Deputy Prime Minister and Minister for Physical Infrastructure and Transport Raghubir Mahaseth. The CPN-UML joined the government on March 5, after Prime Minister Prachanda allied with the CPN-UML, ditching its year-long partnership with the Congress.

All the UML ministers have submitted their resignations to the Prime Minister, Rijal added.

Nepali Congress, the largest party in the 275-member House of Representatives, has 89 seats at present, while CPN-UML has 78 seats. Their combined strength of 167 is sufficient for a majority of 138 seats in the lower house. Prachanda's party has 32 seats.

The Nepali Congress Central Work Performance Committee (CWC) earlier in the day met at Deuba's residence at Budhanilkantha to discuss the current political situation and the party's future strategy.

"The meeting reviewed the latest political situation in the country and discussed the future course of action," said NC spokesperson Prakash Sharan Mahat.

The meeting also endorsed the agreement reached between Deuba and Oli to form a new coalition and share the post of Prime Minister on a rotation basis, he said.

The meeting mainly discussed the agenda and modality of formation of the new coalition government.

The seven-point deal finalised between Deuba and Oli on Monday night includes the sharing of the remaining three-year term of Parliament between the two parties, the ministerial division, provincial leadership roles and a rotation for the prime ministerial position. Oli will assume the post of Prime Minister in the first phase and after one-and-a-half-year, the Nepali Congress will get the leadership of the government.

Speaking to journalists after the meeting, party spokesperson Dr Prakash Sharan Mahat said, "The prime minister should pave the way after the largest parties -- Nepali Congress and UML -- said they would form a new government together. This is also included in the decision."

"Other parties, too, are supporting the new Nepali Congress-UML alliance. So, the Nepali Congress CWC has requested the prime minister to pave the way,” he added.

Mahat said a new government will be formed through the constitutional process if the prime minister does not pave the way for the formation of a new government.

Meanwhile, the spokesperson of Janata Samajwadi Party Nepal Manish Suman said that his party will support the new coalition but has not yet decided on joining the government.

JSP Nepal has five members in the Parliament. Rastriya Prajatantra Party with 14 members in the House of Representatives and Lokatantrik Samajwadi Party with four seats have also indicated support for the new coalition.

However, embattled Prime Minister Prachanda has refused to resign from the post and said he would rather face a vote of confidence in Parliament.

According to the constitutional provision, the prime minister losing a majority support in the House will be required to prove a majority within 30 days. The prime minister must seek a vote of confidence once a ruling alliance withdraws support. This will be the fifth time Prachanda, 69, will seek a vote of confidence within a term of one and a half years.

The former guerilla leader has won three votes of confidence in Parliament.

The CPN-UML has already urged Prime Minister Prachanda to step down from the position so that a new government can be formed as per the constitutional provision.

It also asked all the political parties to join the “national government” under the leadership of Oli to bolster political stability in the country.

Nepal has had 13 governments in the last 16 years, indicating the fragile nature of the Himalayan nation's political system. PTI