Federalism at a Crossroads: A Policy Framework for Democratic Renewal in Post–Gen Z Nepal

Abstract

Federal restructuring is frequently deployed as a post-conflict mechanism to mitigate ethnopolitical tensions and institutionalize democratic inclusivity. However, the long-term sustainability of multi-tiered states depends less on formal constitutional design than on the de facto capacity of subnational authorities to cultivate empirical legitimacy and command public trust. Utilizing a Critical Policy Analysis framework, this study evaluates the structural durability of Nepal’s three-tiered federal architecture during its foundational decade (2015–2025). We identify a profound decoupling between de jure constitutional intent and operational performance, catalyzed by path-dependent bureaucratic centralism, acute subnational fiscal dependency, and the replication of elite rent-seeking networks at the provincial level. This systemic legitimacy deficit reached a critical juncture during the youth-led constitutional crisis of September 2025. We propose an integrated, five-dimensional policy framework and discuss Nepal’s federal project, which faced an existential crisis during the Gen Z movement, to restore state-society alignment. This study positions Nepal as a critical case for examining the volatile intersection of decentralized constitutionalism, subnational state capacity, and grassroots democratic mobilization in the Global South.