Indian MPs urge Singh to quit over ‘Coalgate’

REUTERS

Supporter of veteran Indian social activist Anna Hazare shout slogans as they hold posters of India's Prime Minister Manmohan Singh during a protest against corruption in New Delhi August 26, 2012. The posters read, "Coal thief Dr. Manmohan Singh". REUTERS/Adnan Abidi (INDIA - Tags: POLITICS CIVIL UNREST ENERGY BUSINESS)

Ross Colvin and Satarupa Bhattacharjya New Delhi

Indian legislators chanting “quit prime minister” drowned out Manmohan Singh yesterday as the premier sought to defend his government’s role in an affair dubbed “Coalgate” that has paralysed parliament and created a sense of political crisis.

The controversy has stalled reform efforts at a time when the economy is suffering a slowdown and investors are pressing for changes to rules to allow more foreign investment in the pension, retail, banking and insurance industries.

Coalgate is a short-hand reference to a state auditor’s report published on August 17 that questioned the government’s practice of awarding coal mining concessions to companies without competitive bidding, potentially costing the treasury billions of dollars in lost revenue.

“I wish to say that any allegations of impropriety are without basis and unsupported by facts,” said Singh, who is not expected to yield to the opposition’s demands for him to go.

Until yesterday, Singh had been silent about the report, which partly covered a period when he was also coal minister. His silence has proven politically costly as it has allowed the opposition Bharatiya Janata Party (BJP) to control the narrative and keep the government on the defensive.

While the state auditor’s report did not allege criminal wrongdoing by Singh’s fragile coalition government, it raised concerns about the awarding of coal blocks by an inter-ministerial committee. It said the practice was not transparent and unduly benefited private and state power and steel firms.

The report was fodder for political theatre in India’s parliament yesterday, where BJP legislators and members of the ruling Congress party engaged in a shouting match.

In a written statement, Singh denied any wrongdoing, blamed the delay in introducing competitive bidding for coalfields on resistance from major coal-rich states that were ruled by opposition parties, and said the findings of the state auditor were “clearly disputable”. – Reuters