A meeting of the Nepali Congress' Central Working Committee concluded that there is no alternative to forming a democratic electoral alliance, Kathmandu Post reported.
Nepal is set to hold provincial election on November 26 and Parliamentary elections on December 5.
The Nepali Congress' decision comes a day after left political forces CPN-UML, CPN (Maoist Centre) and Babu Ram Bhattarais Naya Shakti announced an electoral alliance.
"Now broader democratic alliance is a need of the hour to strengthen the democratic forces in the country," said Nepali Congress Central Working Committee member Arjun Narasingh KC.
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NC leader Bimalendra Nidhi said that the party would put forth the proposal for electoral alliance with all other political parties vying in the elections except UML, Maoist Centre and Naya Shakti.
Most NC leaders present at the CWC meeting opined that the unity of leftist forces is a threat to democracy and underscored the need to form a broader democratic alliance.
However, RJP General Secretary Manish Suman said that although the prime minister had summoned top leaders of the party, no discussion was held on the formation of an alliance.
The country recently concluded local-level elections in two decades.
Nepal has been witnessing political instability for a long time.
Madhesis, mostly of Indian-origin, launched a prolonged agitation between September 2015 and February last year against the implementation of the new Constitution which they felt marginalised the Terai community.
The 240-year-old Hindu monarchy was abolished two years later. General elections next month is being seen as the final step in the country's post-war transition to a federal democracy.