Nepal, March 13 -- The clear parliamentary majority for Nepal's Rastriya Swatantra Party (RSP) reduces near-term political uncertainty and provides an opportunity for enhanced policy predictability and implementation of governance and economic reforms, Fitch Ratings said.

The American-British credit rating agency said the election result should lower the risk of prolonged coalition negotiations after severe unrest last year, reduce the likelihood of frequent government changes seen in recent years and potentially boost investor sentiment over time if there are clear signals of improvements in governance and economic reform delivery.

Nepal has faced chronic political instability due to a bloody Maoist insurgency between 1996 and 2006, th...