Nepal's Home Minister Sudan Gurung has resigned after less than eight months in office, stepping down over questions about his investments and links to a businessman under investigation for money laundering. Prime Minister Balendra Shah has taken charge of the Home Affairs portfolio until a replacement is appointed.

Gurung, 38, announced the decision in a statement posted on social media on Wednesday, saying he was leaving to ensure a fair investigation into matters concerning him and to avoid any conflict of interest while in office. "For me, morality is greater than a position and there is no greater power than public trust," he said.

Shares in two micro-insurers at centre of row

The controversy centres on Gurung's shareholdings in two micro-insurance companies, Star Micro Insurance and Liberty Micro Insurance, which reports link to businessman Deepak Bhatta, who is under investigation in a money-laundering case. Reports also highlighted discrepancies in Gurung's recent asset declaration: while he said his investments were financed by a bank loan, the liability was reportedly missing from official records submitted to the prime minister's office. Gurung has dismissed the allegations as "sponsored rumours" from critics of his anti-corruption work.

Second minister to leave the young government

Gurung is the second minister to leave Shah's government, which took office after the Gen-Z protests of September 2025 toppled the previous administration. Labour Minister Deepak Kumar Sah was dismissed earlier over allegations of misconduct, including getting his wife appointed to a health insurance board. Dipa Dahal, press adviser to Prime Minister Shah, confirmed that Gurung's resignation had been received.

Gurung rose to national prominence as a volunteer distributing water during the September 2025 protests, joined the Rastriya Swatantra Party in January 2026 and won a seat in parliament in the March elections before taking office on 27 March. A day after taking his oath, he made headlines by ordering the arrest of former prime minister KP Sharma Oli and former home minister Ramesh Lekhak over their alleged role in the deadly crackdown on protesters, in which at least 76 people were killed and more than 2,500 wounded over two days of violence.