NEW DELHI, Feb 18 (Reuters) - Federal police raided offices
of a TV channel owned by the family of a ruling Congress Party
ally, local media said, as a probe into India's biggest
corruption scandal in decades risked fissures in the government
coalition.
The Friday raids followed allegations that companies linked to a telecoms firm under investigation for buying mobile licences at unfairly cheap prices had paid $47 million to the TV channel run by the Dravida Munnetra Kazhagam (DMK) party.
A deepening probe into the DMK could tense links with Congress and weaken the regional party ahead of a state election this year. The Congress party depends on the DMK to help ensure a parliamentary majority.
The probe is becoming a serious threat to Prime Minister Manmohan Singh, accused of heading a corrupt government that has sold access to the world's fastest growing mobile phone market at rock-bottom prices, depriving the state of billions of dollars in revenue and scaring off investors.
Still, the Congress party-led government is not at huge risk of collapsing because of its support from coalition allies, whose positions within government keep them from jumping ship.
The government on Thursday scrapped another lucrative telecoms contract due to irregularities, dealing a fresh blow to Singh, whose office was ultimately responsible for the deal.
The last parliamentary session was halted by opposition protests demanding a probe into the telecoms scam, effectively stopping any reform bills such as one to make land acquisition easier for both industry and farmers.
Singh's government now appears close to agreeing to a broad, cross-party investigation into the 2G mobile scandal, paving the way for parliament to resume for the Feb. 21 budget session.
Foreign investors have pulled hundreds of millions of dollars from the Indian stock market since the start of the year, while foreign direct investment has fallen for three consecutive years, from 2.9 percent of GDP in 2008/09 to around 1.8 percent of GDP in 2010/11. Some of this may be linked to regulatory uncertainty and corruption scandals. (Reporting by Alistair Scrutton and Henry Foy)
The Friday raids followed allegations that companies linked to a telecoms firm under investigation for buying mobile licences at unfairly cheap prices had paid $47 million to the TV channel run by the Dravida Munnetra Kazhagam (DMK) party.
A deepening probe into the DMK could tense links with Congress and weaken the regional party ahead of a state election this year. The Congress party depends on the DMK to help ensure a parliamentary majority.
The probe is becoming a serious threat to Prime Minister Manmohan Singh, accused of heading a corrupt government that has sold access to the world's fastest growing mobile phone market at rock-bottom prices, depriving the state of billions of dollars in revenue and scaring off investors.
Still, the Congress party-led government is not at huge risk of collapsing because of its support from coalition allies, whose positions within government keep them from jumping ship.
The government on Thursday scrapped another lucrative telecoms contract due to irregularities, dealing a fresh blow to Singh, whose office was ultimately responsible for the deal.
The last parliamentary session was halted by opposition protests demanding a probe into the telecoms scam, effectively stopping any reform bills such as one to make land acquisition easier for both industry and farmers.
Singh's government now appears close to agreeing to a broad, cross-party investigation into the 2G mobile scandal, paving the way for parliament to resume for the Feb. 21 budget session.
Foreign investors have pulled hundreds of millions of dollars from the Indian stock market since the start of the year, while foreign direct investment has fallen for three consecutive years, from 2.9 percent of GDP in 2008/09 to around 1.8 percent of GDP in 2010/11. Some of this may be linked to regulatory uncertainty and corruption scandals. (Reporting by Alistair Scrutton and Henry Foy)
No comments:
Post a Comment