Nepal's new parliament unanimously approved a slashing of King Gyanendra's powers yesterday as demonstrators crying "Down with the king" sought to destroy a statue of the founder of the royal dynasty.
The draft, which was approved earlier yesterday by the Cabinet, was put before parliament later in the day.
Under the proclamation, the government's name will change from His Majesty's Government to the Nepal Government and the Royal Nepalese army becomes the Nepal Army, Works Minister Gopal Man Shrestha said.
The draft also called for taxation of royal income and properties and gives the government the right to choose the king's successor, a step aimed at the unpopular Crown Prince Paras, whose playboy image and reckless driving has made him a target of criticism.
Ahead of the parliamentary session, demonstrators climbed up on a statue of King Prithvi Narayan Shah, the founder of the 250-year-old Shah dynasty and pounded it with bricks in a vain bid to destroy it.
"We are demonstrating to make sure the government declares the proclamation today," protester Puran Gurung said.
Police blocked roads around the parliament, but made no attempt to arrest the demonstrators.
The interim government established late last month after Gyanendra was forced to give up his absolute rule said on Wednesday it was moving ahead to clip the monarch's powers "in response to the aspirations of the people."
"The traditional powers and privileges of the monarchy are in the process of being curtailed," Finance Minister Ram Sharan Mahat said.
Gyanendra sacked the government and seized direct control in February last year, a move he justified by saying that political parties had failed to adequately tackle a decade-long Maoist insurgency.
He was forced to hand back power after weeks of protests crippled the nation and left 19 people dead.
Local media have criticized the new government as moving too slowly to cut the monarch's power and there have been some street protests against the new authorities.
Mahat told donors and diplomats on Wednesday that the government faced a tough task meeting aspirations.
"People have high expectations. We may not be able to meet them all immediately, but we should surely take the right decisions so that people can see things are happening," Mahat said.
The Cabinet met yesterday to discuss its expansion from the seven-member skeleton body named after the royal climbdown and is expected to eventually include a maximum of 21 posts.
"Some of the vacant ministerial posts may be filled during this session of parliament," Shrestha said.
Curtailing the king's powers is part of the new administration's efforts to persuade Maoist rebels to uphold a ceasefire declared after the king gave up power and participate in peace talks to end their rebellion.
The new government has also met a key demand for an election for a body to redraft Nepal's 1990 Constitution to formally curtail the king's powers.
The proclamation is only temporary until the constituent assembly is elected.