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Nepal Prime Minister Girija Prasad Koirala on Thursday resigned following intense pressure from the opposition, which alleged he was corrupt and inefficient.
He submitted his resignation to King Gyanendra, even as lawmakers demanding his ouster blocked proceedings in parliament.
The king accepted the resignation but asked Koirala to continue in office till alternative arrangements are made, a palace announcement said.
Soon after stepping down, Koirala, 76, addressed the nation on the state-run radio and television, accusing the opposition of non-cooperation in addressing the problems of the Himalayan kingdom.
Koirala had faced pressure for the past several months from opposition parties as well as from within his own ruling Nepali Congress (NC) to step down amid allegations of corruption in an airliner lease deal with Austria's Lauda Air.
Koirala, who had taken over as prime minister for the third time on March 19, 2000, in his address charged the opposition with not being committed towards solving the outstanding problems facing Nepal.
"I had brought forward a 14-point consensus building measure, but everybody thought I wanted to cling to power," Koirala said. "As the opposition did not support me in addressing pressing problems of the country, I decided to step down."
Koirala's successor is likely to be his close aide and relative, Foreign Minister Chakra Bastola, who recently took over the home portfolio after deputy prime minister and home minister Ram Chandra Poudel resigned following the abduction of 72 policemen by Maoist guerillas last week.
In March last year, he had taken over from the then prime minister Krishna Prasad Bhattarai, who had himself replaced Koirala in June 1999.
Koirala was first elected prime minister in 1991.
Indo-Asian News Service
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