Pushpa Kamal Dahal "Prachanda" will be sworn in for the third time as the Prime Minister of Nepal on Monday, a day after President Bidya Devi Bhandari appointed him as the new premier and ended the protracted political uncertainty in the Himalayan nation.

President Bhandari on Sunday appointed 68-year-old Prachanda as the country's new prime minister as per Article 76 (2) of the Constitution after receiving the CPN-Maoist Centre chairman's claim to the seat, backed by as many as 169 Members of the House of Representatives.

The former guerrilla leader will take charge as the prime minister after taking the oath of office and secrecy from President Bhandari at an official ceremony at Shital Niwas on Monday afternoon.

Despite getting appointed prime minister with an overwhelming majority, Prachanda will now have to win a vote of trust from the lower house within 30 days as per Article 76 (4) of the Constitution.

"The prime minister of a coalition government must prove that he has the confidence of the House,” Mohan Acharya, a constitutional lawyer, told the Kathmandu Post newspaper.

If he fails to win the confidence of the House, then a new process for government formation will begin.

The surprise development of Prachanda becoming the new premier may not bode well for India-Nepal ties as he and his main backer and former premier K P Sharma Oli have had some run-ins with New Delhi previously over territorial issues.

Oli on Sunday outfoxed his bete noire and ex-prime minister Sher Bahadur Deuba, a veteran of manoeuvring hung parliaments to his advantage.

Prachanda, who is being appointed as the Prime Minister of Nepal for the third time, is seen as pro-China. He has in the past said a new understanding with India needed to be developed on the basis of a "changed scenario" in Nepal and after addressing all outstanding issues, like revision of the 1950 Friendship Treaty and resolving Kalapani and Susta border disputes.

The India-Nepal Treaty of Peace and Friendship of 1950 forms the bedrock of the special relations between the two countries.

In recent years, Prachanda, however, has said India and Nepal need to address diplomatically some of the issues “left by history” to realise the full potential of the bilateral cooperation.

His main backer Oli is also known for his pro-China stance. As the prime minister, Oli last year claimed that efforts were being made to oust him after his government redrew Nepal’s political map by incorporating three strategically key Indian territories, a move that strained ties between the two countries.

India had termed as "untenable" the "artificial enlargement" of the territorial claims by Nepal after its Parliament unanimously in 2020 approved the new political map of the country featuring Lipulekh, Kalapani and Limpiyadhura areas which India maintains belong to it.

The country shares a border of over 1,850-km with five Indian states - Sikkim, West Bengal, Bihar, Uttar Pradesh and Uttarakhand.

Land-locked Nepal relies heavily on India for the transportation of goods and services. Nepal’s access to the sea is through India, and it imports a predominant proportion of its requirements from and through India.

Born in Dhikurpokhari of Kaski district near Pokhara on December 11, 1954, Prachanda remained underground for almost 13 years. He joined mainstream politics when the CPN-Maoist adopted peaceful politics, ending a decade-long armed insurgency.

He led the decade-long armed struggle from 1996 to 2006 that ultimately ended with the signing of the Comprehensive Peace Agreement in November 2006.

Earlier, a crucial meeting was held at former prime minister Oli's residence where the CPN-Maoist Centre and other smaller parties agreed to form a government under the leadership of ‘Prachanda’.

There has been an understanding between Prachanda and Oli to lead the government on a rotation basis and Oli agreed to make Prachanda Prime Minister at the first chance as per his demand.

Earlier in the day, Prachanda walked out of the Nepali Congress-led five-party alliance after Nepali Congress president Deuba rejected his bid to become the Prime Minister in the first round.

Deuba and Prachanda had earlier reached a tacit understanding to lead the new government on a rotational basis.

During talks with Prachanda on Sunday morning at the PM House, Nepali Congress had staked a claim for both the key posts of President and Prime Minister, which Prachanda had rejected, resulting in the failure of the talks, Maoist sources said.

After talks with Prime Minister Deuba failed, Prachanda reached the private residence of CPN-UML chairman Oli to seek his support to become the Prime Minister. Leaders of other smaller parties joined him.

Not only did Oli succeed in getting Prachanda anointed as the prime minister, a move which weaned Prachanda away from the Congress-led alliance, but he also now gets to have his own candidate for the head of the state and the Speaker of the House of Representatives along with plum ministries and a majority of the provincial chief ministers.

The wheel turned full circle since Prachanda and Oli were allies till the former broke away last year and backed Deuba for the prime minister.

Until Sunday afternoon, a Nepali Congress-led coalition led by Deuba was the favourite to form the next federal government. The Oli masterstroke means that he will now get to pull the strings of power.

“Until the last hour, the UML was not getting anything but now it will have the President and Speaker from the party, apart from the chief ministers of at least four provinces. It is a political triumph for Oli,” Jhalak Subedi, an analyst of left politics, told the Kathmandu Post.

“Even though Oli is not taking the helm of government, he will have the pole position in steering the government, checking the Dahal-led administration through the President and Speaker,” the analyst added.

The Deuba-led Nepali Congress is the largest party with 89 seats in the House of Representatives while CPN-UML and CPN-MC have 78 and 32 seats, respectively. No party in the 275-member House of Representatives has 138 seats required to form a government.

In the House, CPN (Unified Socialist) has 10 seats, Loktantrik Samajwadi Party (LSP) has four, and Rastriya Janamorcha and Nepal Workers and Peasants Party have one seat each.

There are five independent members in the Lower House.

The new alliance of the seven parties seems to be headed to form governments in all seven provinces.

Except for the headline, this story has not been edited by The Telegraph Online staff and has been published from a syndicated feed.