KATHMANDU (AFP) - Nepal's prime minister resigned on Sunday, plunging the country into a fresh political crisis with competing parties unable to implement a national peace plan or form a stable government. Jhalanath Khanal, chairman of Unified Marxist Leninist (UML) party, submitted his resignation to the country's president after talks with other party leaders collapsed, his press adviser Surya Thapa told AFP. "He tried to forge a consensus until the last minute. But the parties failed to agree on constitution-drafting and the peace process, so he has resigned," Thapa said. Nepal emerged from 10 years of civil war in 2006 but lawmakers elected to write a new constitution have failed to reach a consensus on the new charter amid a series of shaky coalition administrations. The impoverished Himalayan nation was without a prime minister for seven months until Khanal took office in February, and the parliamentary deadlock could return following his departure. The Maoists, who fought government forces between 1996 and 2006, are the biggest party in parliament after winning 2008 elections under Pushpa Kamal Dahal, known by his nom de guerre, Prachanda ("the fierce one"). Khanal, 60, headed a fragile coalition government of three parties, including the Maoists, but he had said he would resign unless a deal was reached to advance the peace process. Integrating 19,000 former Maoist rebel fighters into the army is one of the key sticking points in the peace plan, with military leaders and the opposition Nepali Congress party resisting the move. Observers say the political inertia threatens post-war reform and development in the country, where many were optimistic that historic grievances and inequalities would be addressed after the bloody civil war ended. The new constitution is needed to pave the way for fresh elections but the 601-member parliament, or Constituent Assembly, has failed to draft the document despite two deadline extensions. A first extension in 2010 was followed by the crippling seven-month leadership vacuum, during which lawmakers held 16 failed attempts to elect a new prime minister. Jhalak Subedi, editor of the monthly political magazine Mulyankan, said the centrist Nepali Congress, the second-largest party in the parliament, was likely to lead the next coalition administration. "But I don't think that the next government will last more than three months," he said. "The whole process has been slowed down by radicals within the Maoist party who are blocking any moves forward in the peace process." Subedi warned that continued political turmoil could lead to more serious unrest as public anger grows. "It's likely that some groups will seek to cash in on the people's frustration by staging protests and try to destabilise the country," he said. Stunted economic growth has forced many Nepalese to seek work overseas, and thousands have attended rallies to protest against the lack of progress in delivering the constitution. In 2008 the parliament voted to abolish Nepal's 240-year-old Hindu monarchy, transforming the country into a secular republic.