Kathmandu (PTI): Efforts to form a new government in Nepal suffered a jolt on Tuesday with two leading mainstream political parties setting fresh conditions to join a Maoist-led dispensation in the Himalayan nation.

Nepali Congress and CPN-UML, which emerged as the second and third largest parties respectively in last month's Constituent Assembly polls, said they have decided not to join a Maoist-led government immediately and their first priority was to declare the country a republic.

Setting pre-conditions for supporting a Maoist-led government, Nepali Congress central committee has called for disbanding of the Maoists' People's Army, people's court and parallel government as per their earlier agreement with the Maoists.

The party has also called for dissolution of the para-military structure of the Young Communist League (YCL), rehabilitation of the Maoist combatants and rehabilitation of the conflict displaced persons. They also demanded halting of intimidation, extortion and threats by the Maoists.

CPN-Maoist, which secured 220 seats in the 601 member Constituent Assembly, is eager to head the new government under the leadership of Prachanda and has also claimed the post of President in the new government.

The priority at present is to declare the country a republic through the Constituent Assembly and to draft a constitution that would institutionalise the achievements of the peoples' movement rather than joining the government immediately, Nepali Congress leader Prakash Mahat said.

However, CPN-UML stresses on separation of power by distributing the three major posts of President, Prime Minister and chair of the Constituent Assembly to three major parties.