Traffic jams the streets, cars and motorbikes honk impatiently amidst the heat and dust, smoke rising from temples mixes with that from uncollected rubbish burning on street corners, while bright purple flowers blossom on the trees.

But underneath, political change is simmering. The peoples' demonstrations were only the first phase and difficult challenges lie ahead on the road to full democracy, say observers.

The new government, headed by the frail, 84-year-old Girija Prasad Koirala, and the seven-party alliance he leads, is nevertheless pushing ahead with sweeping changes.

On 1 May the parliament voted for a constituent assembly which will write a new democratic constitution and decide whether Nepal will become a republic – the central demand of the people's movement.

Pressure still on

On 2 May, a seven-member cabinet was formed (with much inter-party squabbling), and the government lifted the terrorist tag on the Maoists.

More importantly, the new cabinet announced a reciprocal ceasefire with the Maoists and agreed to start a dialogue.

Local elections held under the king were also annulled, and last Friday a commission was announced to investigate abuses by the security forces during the April demonstrations, when 19 people were killed and around 5000 were injured.

The government is due to hold
talks with Maoist rebels shortly

The cabinet also loosened restrictions on the media put into effect when King Gyanendra dismissed the government and assumed absolute power last year.

Despite these changes, democracy activists are determined to keep up the pressure – worried that the seven-party alliance could backslide into infighting and corruption, while the king is still in his palace and the loyalty of the army to civilian government is not yet assured.

"We have to keep things simmering," Devendra Raj Panday, who was imprisoned for three months till the end of the uprising, says.

Many worry that, despite his stunning defeat, the king will bide his time and attempt to strike back. Panday thinks "as long as he (the king) is only down and not out we cannot be reassured [of] the future".

Kanak Mani Dixit, editor of Himal, a South Asian political magazine, agrees.

"The king is not finished and there will be constant vigilance until the beast is tied down". But he goes on "if we are not confident at this stage having shown the world what a people's movement is, when can we be confident?"

Disarm or else

On the political front, the government and Maoists have yet to agree to a code of conduct for their talks, which could start within two weeks, and will likely focus on the constituent assembly and its composition.

The talks are also expected to address how to move to free and fair elections and ensuring that women, Dalits (formerly known as untouchables) and indigenous people are fairly represented.

Before elections, the ceasefire will have to endure and the Maoists will have to give up arms. An overall process of demobilisation and restructuring of the armed forces will also need to begin.

Both international and Nepali commentators suggest that the Maoist forces and the Royal Nepalese Army (RNA) will have to be confined to barracks with arms locked up and supervised by international monitors for the elections to be free and fair.

Implementing a ceasefire, demobilisation and giving up arms will not be easy. As Kieran Dwyer, spokesman for the UN human rights office in Nepal, puts it: "These things can wobble and fall apart so there is a need for very solid, legitimate, independent monitoring."

Parliament controls army

The general-secretary of the Nepalese Communist Party (CPN-UML), Madhav Kumar Nepal, has gone a step further and demanded the removal of the term "royal" from the army's name.

Furthermore, the UML is about to table a bill to bring the army under parliament's control.

There is talk of merging Maoist
fighters with the army

Such a bill is vital, says Dixit: "We became a militarised state – we must take away the commander-in-chief title from the king, and colonel-in-chief from the crown prince. And we have to penalise the army for going along with the king".

In the end a new national army may be formed by merging Maoist and RNA forces.

Whether the army will go along with all such changes is an open question, its loyalty seen as being essentially with the king.

The government-Maoist talks are expected to last around two months, after which it is expected that an interim government will be formed including Maoist representatives.

Old constitution

An interim constitution may also be hammered out, though there is debate over amending the old 1990 constitution, or asserting that the new parliament is sovereign on the strength of the people's movement.

Managing the process of so-called transitional justice during this time will also be vital, according to Kundan Aryal, general secretary of INSEC, a human rights NGO.

This is not only about investigating abuses and killings during the April demonstrations, but also about tackling the problem of the many "disappeared".

He says there will be a need to determine whether a truth and reconciliation commission is required to address human-rights abuses during the past 10 years since the Maoist insurgency began.

Elections

If all goes well with the Maoist-government talks, an interim government and constitution could be in place in three months.

While the Maoists and other pro-reform pundits hope elections for the constituent assembly are held this autumn, many suggest April 2007 as a likely venue.

Koirala, the new prime minister,
is pushing ahead with changes

Then the assembly will have to meet, agree to the constitution, put it to a referendum and only after that proceed to general elections for a new parliament and government. The whole process could take two years or more from now, so the challenges for the interim government in the meanwhile will be considerable.

Some hope that as the changes start to look irreversible, the king will finally leave the country. Others fear that he could still strike back.

Shambhu Thapa, president of the Nepal Bar Association, warns that should the king repress the pro-reform movements, protests and demonstrations will quickly be renewed.

"If the king crosses the line again, he will go, he will not be here," he said. "If our rights are infringed, even by this government, the people will come on the streets".