Major opposition parties of the Nepali parliament have started preparations to form a new government after Prime Minister KP Sharma Oli lost the vote of confidence at Lower House on Monday.

A coalition of more than two parties representing in the parliament, who will form Nepal's new government, have already started consultations over the next leadership. Three opposition leaders, namely, Deuba, Pushpa Kamal Dahal and Upendra Yadav had called on President Bidya Devi Bhandari to initiate government formation procedure, soon after the commencement of a special session of parliament on Monday.

All leaders from the Nepali Congress, the Communist Party of Nepal (Maoist Centre) and a faction of the Janata Samajwadi party led by Yadav have urged President Bhandari to invoke Article 76 (2) of the Constitution.

The Nepal President called on all parties to stake claim to form a majority government after Oli's failed vote of confidence in the parliament. Earlier in the day, Prime Minister Oli lost a vote of confidence in parliament as he could only garner just 93 votes, way less than 136 that he needed to prove a majority in the House.