The ongoing structural reform process in Nepal is the outcome of over one decade of negotiations among
the former ruling Monarch, Nepali political parties and the Maoist movement, under the impetus of civil
society mobilisation for change – with demands ranging from power, rights and dignity for people at the
community level. This paper analyses the ways in which the peace process, which put an end to the armed
conflict in Nepal in 2006, has sought to address popular demands for inclusive democracy. It does so by
reviewing the various cycles of negotiation, codification and materialisation of political reforms since the
People’s Movement of 2006, the Comprehensive Peace Accord and the (first and second) Constituent
Assemblies. It focuses in particular on one area of reform that has been widely debated among political and
civil society sectors, namely, state restructuring through power decentralisation. Overall, the paper
develops the arguments that although there is a widespread consensus that state institutions should be
made more inclusive and representative of the makeup of society, the voices of power contenders, such as
the Madhesi and Janajati communities, have failed to be adequately represented in constitutional debates.
Their exclusion could lead to an undermining of all the achievements made so far in terms of laws and
practices in favour of the marginalised communities and the achieved and pipelined progresses towards a
democratic Nepal. This could further plunge the country into violence in an endless political transition.