Prime minister Girija Prasad Koirala is expected to tender his resignation today, saying he is not yielding to the opposition demand but to live up to his public pronouncement that he would go the moment he was questioned about a controversial jet-leasing deal.

The statutory anti-corruption body Commission for the Investigation of Abuse of Authority (CIAA) wrote a letter to Koirala on Wednesday seeking "clarifications" on five questions relating to the jet-leasing decision by the Royal Nepal Airlines. In October last year the cabinet, chaired by Koirala, had approved the request by RNAC to obtain the necessary foreign exchange for sealing the deal.

Koirala met close advisors at his residence in Baluwatar on Wednesday evening to draft a response to the CIAA. He is now expected to clarify his position publicly later today. "That is the plan for now," a source close to Koirala said. "The final decision on the resignation is expected at the end of the meeting of a meeting of the council of ministers now underway."

Koirala, the party president, belongs to the founder-generation of the party and still has a firm grip on his supporters, which means he will continue to have considerable influence even when he is outside government. The prime minister's exit is also expected to calm down the communists, who have been agitating since early February to force their one-point agenda: Koirala's resignation. However, it will take time for the political dust to settle, depending on how the emerging political equations unfold.