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Indian Ministers Fired as Graft Claims Taint Singh’s Government

Indian Prime Minister Manmohan Singh
The Bharatiya Janata Party and other groups have also demanded Indian Prime Minister Manmohan Singh quit over alleged interference in the probe of coal-block allocations. Photographer: Sean Gallup/Getty Images

May 12 (Bloomberg) -- Indian Prime Minister Manmohan Singh fired two of his Cabinet ministers to help limit the damage caused by graft allegations against his government and the ruling Congress party.

On the advice of Singh, President Pranab Mukherjee accepted the resignations of Rail Minister Pawan Kumar Bansal and Law Minister Ashwani Kumar, according to an e-mailed statement from the president’s office yesterday. Congress party chief Sonia Gandhi forced Singh to seek the exit of the two from his council, the Indian Express reported yesterday.

The Central Bureau of Investigation earlier this month arrested a member of Bansal’s family on charges he accepted money in exchange for a top post in the department. Separately, the CBI told the Supreme Court last month that Kumar was among officials who vetted a corruption probe report and altered its content. Kumar told reporters yesterday that he quit to comply with his party’s orders and to help end all controversies. Both men have denied any wrongdoing.

The bribery allegation in the railways is the latest in a series of corruption claims that have marked Singh’s second term in office, hobbling his legislative agenda before national elections due by May 2014. The parliament ended its budget session two days earlier than scheduled last week as opposition parties stalled proceedings, demanding the resignation of Bansal and the law minister.

Early Elections

“They want to show that they are doing something about corruption and more effective governance,” said N. Bhaskara Rao, chairman of the New Delhi-based Center for Media Studies. “They are exploring the possibility of early elections.”

Singh is planning a Cabinet reshuffle this week and until then Road Minister C.P. Joshi will handle the rail portfolio, while Telecommunications Minister Kapil Sibal will oversee law, CNN-IBN television channel reported yesterday.

The Bharatiya Janata Party and other groups have also demanded Singh quit over alleged interference in the probe of coal-block allocations. Singh was in charge of the coal ministry for part of the period under investigation and has been blamed by opposition parties for irregularities.

The top court criticized the CBI and the government on May 8 for making changes to the report. It said the CBI has “become a caged parrot and it has many masters,” and directed the government to make it independent.

‘Dramatic Message’

Singh’s party may be trying to show that it is getting tough on graft to help build on the momentum after it swept to power in the southern state of Karnataka this month, routing the BJP that had faced its own share of scandals locally, Rao said.

“The government is trying to send out a dramatic message that they are alive and alert,” he said.

The BJP, which ruled Karnataka for the past five years, became embroiled in a $3.6 billion illegal mining scam where companies were accused by the state’s anti-corruption ombudsman of operating without permits and evading taxes. Chief Minister B.S. Yeddyurappa was named in the probe and forced to step down.

Those revelations have blunted the BJP’s campaign to target Congress over corruption as the nation faces polls.

Andimuthu Raja resigned in 2010 as telecommunications minister after being accused by the country’s chief auditor of favoring certain companies in the awarding of mobile-phone licenses in a move that may have cost the exchequer $31 billion. He is on trial and denies any wrongdoing.

To contact the reporter on this story: Andrew MacAskill in New Delhi at amacaskill@bloomberg.net; Abhijit Roy Chowdhury in New Delhi at achowdhury11@bloomberg.net

To contact the editor responsible for this story: Rosalind Mathieson at rmathieson3@bloomberg.net; Sam Nagarajan at samnagarajan@bloomberg.net

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