Financial Stability Key To Federalism

Federalism in Nepal, introduced by the Constitution of Nepal (2015), aims to establish a decentralised governance system by distributing power among federal, provincial, and local levels. Despite legal provisions that facilitate intergovernmental cooperation, the implementation of federalism faces several challenges, including political instability, poor coordination, and financial interdependencies. This article explores the political economy of federalism in Nepal, focusing on intergovernmental relations, political stability, and stakeholder interests that shape its implementation at national and subnational levels.