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India police charge MP in telecoms probe

New Delhi, April 25, 2011

Indian police charged the daughter of a key ally in the coalition government in one of the country's biggest corruption scandals on Monday, putting a strain on the Congress party-led government as it fights major state elections.

Kanimozhi, the daughter of the regional Dravida Munnetra Kazhagam (DMK) party's head and herself a lawmaker, was among those charged with receiving bribes along with several business executives in a multi-billion dollar telecoms scandal, a lawyer for India's federal police said.

Police also filed charges against two more executives from DB Realty , whose parent DB Group is the Indian joint venture partner of the UAE's Etisalat , and the managing director of a south Indian television channel owned by the DMK party.

They have been accused of handling bribes, a lawyer for the federal police told reporters.

Months of corruption scandals have battered Prime Minister Manmohan Singh's coalition government, stymied its agenda for economic reform and undermined business sentiment in one of the world's fastest-growing economies.

Police had earlier charged three telecoms firms, a former telecoms minister and six corporate executives with a range of crimes in the licensing scandal that a state auditor said may have deprived the government of $39 billion in potential revenue.

The south India-based DMK party is a member of Singh's government, helping it maintain a slim majority in parliament.

The two parties jointly govern Tamil Nadu state and the telecoms scandal could drain support for the state coalition in the staggered election, results of which are due on May 13.

The DMK, which has denied any wrongdoing, has threatened to pull ministers out of the government if members of the family that heads the party were charged, according to media reports.   

In a sign of fraying ties, the DMK threatened to pull out from the government in March in a row over seat-sharing arrangements in the Tamil Nadu election. However, analysts question whether the DMK would act on such a threat, given that it needs Congress's clout in the state as much as Congress needs the DMK's 18 seats to maintain its federal majority. 

Police investigating the telecoms case say companies connected to the DB Group funnelled millions of dollars to a television channel owned by the family that runs the DMK party. Those charged in the ongoing telecoms case have denied any wrongdoing.

The fresh charges coincided on Monday with the arrest of a senior Congress party lawmaker in connection with a graft investigation in the Delhi Commonwealth Games, which were held in October last year.  

Suresh Kalmadi will be "produced before a special judge" on Tuesday and formally charged on several conspiracy counts relating to the awarding of commercial contracts, said Dharini Mishra, spokeswoman for the Central Bureau of Investigation (CBI).

A member of parliament for India's ruling Congress party, Kalmadi was sacked as chairman of the Games organising committee as police investigated charges that the organisers had manipulated tenders and knowingly inflated costs.

Mishra cited specific charges that organising officials had conspired to ensure a contract for a private Swiss firm to be the event's official timekeeper by "wrongfully restricting and eliminating competition from other suppliers in a premeditated manner."

Other charges related to contracts awarded for a 2009 ceremony in London to mark the start of the baton rally, which saw a Games baton travel across participating nations.

 




Tags: Congress | charge | telecom scam | DMK |

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