Kathmandu, Jul 3 (IANS): The main opposition Nepali Congress party on Wednesday called on Prime Minister Pushpa Kamal Dahal to step down, one day after the largest ruling partner initiated the move.

"It would be natural for the prime minister to clear the way as the two largest parties decide to form a new government. Our party urges him to resign," said Prakash Saran Mahat, spokesperson for the Nepali Congress, the largest in the House of Representatives, Xinhua news agency reported.

A day earlier, the ruling Communist Party of Nepal (Unified Marxist Leninist) (CPN-UML), the second largest in the lower house, asked Dahal to resign by Wednesday evening to clear the way for the formation of a "national consensus government," threatening to quit the coalition government and withdraw its support if the prime minister refuses to do so.

At a meeting on Wednesday, the Nepali Congress also endorsed the agreement reached on Monday night with the CPN-UML about the formation of a new coalition government.

Under the deal, CPN-UML's Chairman and former Prime Minister KP Sharma Oli shall assume the premiership first and then hand it over to Nepali Congress President and former Prime Minister Sher Bahadur Deuba until the general election in 2027.

"The Oli-led government will be formed first. Our party president will lead the next government," Mahat told Xinhua.

As chairman of the CPN (Maoist Center), Dahal became the head of a coalition government in December 2022 as the general election in November produced no majority party in the lower house, and he has formed alliances with both the Nepali Congress and the CPN-UML ever since.

The CPN (Maoist Center) announced on Tuesday that Dahal would not resign from his post but rather seek a vote of confidence in the lower house.