As soon as the new date was declared, the Commission moved quickly to arrange the nomination deadline. Unfortunately, before the election managers could catch their breath different ethnic groups, mainly from within the Madhesi community, re-started their agitation, which severely affected districts in the Tarai region. The Madhesi groups blamed the eight parties—the SPA and the Maoists—for failing to implement the 22-Point Agreement, which promised them greater representation. The resistance was fostered by the emergence of new Madhesi-based regional parties and cross-party alliances.

Senior Nepali Congress leader Mahanta Thakur quit his party to form his own party known as the Tarai Madhesh Lokatantrik Party (TMLP) or Lokatantrik party. He accused the mainstream parties of being insensitive to Madhesi concerns and of being indifferent to the under-representation of Madhesis in all state agencies and political parties. Thakur said he had no option other than to quit the Nepali Congress and to start a new party, which was committed to the interests of the Madhesis. Other Madhesi leaders, and parliamentarians from the mainstream parties, followed suit and joined the growing number of new Madhesi-based regional parties.

The Lokatantrik party immediately created a working alliance with a joint forum of two Madhesi-based parties—the Sadbhavana party and the Madhesi Forum party. (The Madhesi Janadhikar Forum or the Madhesi People's Rights Forum – a civil society organisation registered itself as a political party.