Nepal got a functioning prime minister after seven months of leadership vacuum on Thursday, but analysts refused to call it a breakthrough and remained jittery about the future of the country’s stalled peace process.

Jhala Nath Khanal, the chief of a moderate communist party, Unified Marxist Leninist (UML), was elevated to the post after 16 rounds of voting. He got last-minute backing from the Unified Communist Party of Nepal (Maoist), which fought a 10-year war against state forces until 2006.

While a step forward after months of embarrassing votes, the formation of a government is just a small step toward political stability in Nepal, which confronts the serious challenges of settling the future of some 19,000 Maoist combatants and drawing up a new constitution. And analysts say that the new coalition threatens to cause a left-leaning polarization and an escalation of ambitions of the Maoists, who are now in a position to oust the new prime minister at will.

The previous government was backed by the moderate Nepali Congress party and several ethnic parties, making it less receptive to Maoist demands. Those demands include radical land reforms, subservience of the judiciary to the legislature, and a constitutional provision of banning "antinationalist’" political parties.

Mr. Kanal is considered far more sympathetic to Maoist agendas.

“The coalition might trigger a fragmentation in Nepal’s politics,” warns Yubaraj Ghimire, political commentator and former editor of the Kathmandu Post. “Depending on how the Maoists behave, a tussle between Nepal Army and democratic forces on the one side, and the ruling coalition on the other side, is possible,” he adds.

Others are even gloomier in their assessment.

“The only achievement of Thursday’s election is that the parliament replaced a caretaker prime minister with a functioning prime minister,” says Bhimarjun Acharya, a columnist and constitutional lawyer. “I don’t expect the formation of a new government to inject any momentum into the constitution writing effort."

Centrists feel betrayed

The Nepali Congress party said on Friday that it felt betrayed by UML forming an alliance with the Maoists. The previous government was supported by the Nepali Congress, which had expected UML to support to their prime ministerial candidate.

The future of ex-combatants and a new constitution was supposed to have been resolved by last May. But a power struggle that has gripped the country since a special assembly was elected in April, 2008, hindered progress.

The assembly’s life was extended, and just four months remain before the extended deadline expires. A UN mission that was monitoring the combatants, who are corralled in 28 camps, left the country Jan. 15.

Maoists acted out of frustration

Mr. Acharya, the lawyer, terms Thursday’s surprise coalition announcement unnatural. “It was just an expression of anger and frustration of the Maoists. After being unable to gather support for getting elected himself, Maoist chairman Prachanda wanted to teach India a lesson by elevating someone not favored by India to power,” he says.

Prachanda admitted while addressing the parliament on Thursday that he had decided to withdraw his own candidacy and support Khanal to prove that Nepal can make its own decisions, a clear reference to Indian influence (often termed here as interference) in Nepal’s politics.

His support could complicate Khanal's ability to function. Khanal's UML party leadership is dominated by liberal communists who do not want to promote the Maoist agenda. Khanal will face the twin challenge of tempering the liberals in his own party and continuing to get support of the Maoist party.

Narayan Wagle, editor-in-chief of Nagarik, a leading Nepali daily, echoed similar concerns in an opinion piece published Friday. “The success of the new government will depend on whether the Maoists use Mr. Khanal as their puppet," he wrote, "or help him complete the peace process and constitution writing.”