After the reinstatement of the Nepal House of Representatives, Pratinidhi Sabha, on 24 April 2006 following the Loktantra Andolan, Koirala was selected to become Prime Minister by the leaders of the Seven Party Alliance.
The reinstated House of Representatives passed laws to strip the King of his powers and bring the Army under civilian control.
Following the promulgation of the interim constitution, Koirala, as the Prime Minister, has been the interim head of state of Nepal.
On 1 April 2007, Koirala was re-elected as Prime Minister to head a new government composed of the SPA and the CPN (Maoist).
Following the April 2008 Constituent Assembly election, the Constituent Assembly voted to declare Nepal a republic on 28 May 2008. Koirala, speaking to the Constituent Assembly shortly before the vote, said that "we have a big responsibility now"; he said that Nepal was entering a "new era" and that "the nation's dream has come true".[2]
In the discussions on power-sharing that followed the declaration of a republic, the Nepali Congress proposed that Koirala become the first President of Nepal; however, the CPN (Maoist), which had emerged as the strongest party in the Constituent Assembly election, opposed this.[3] At a meeting of the Constituent Assembly on June 26, 2008, Koirala announced his resignation, although it would not be finalized until after the election of a President, to whom the resignation had to be submitted.[4]
Koirala was present for the swearing in of Ram Baran Yadav, the first President of Nepal, on July 23, 2008.[5][6] He submitted his resignation to Yadav later on the same day.[7] CPN (M) Chairman Prachanda was elected by the Constituent Assembly to succeed Koirala on August 15, 2008, and Koirala congratulated Prachanda on this occasion.[
