No-bid coal scandal blackens India's government

Published August 21, 2012

| Associated Press

Angry opposition lawmakers shouted and crowded aisles in India's parliament Tuesday to demand the prime minister resign after an audit found the government lost huge sums of money by selling coal fields without competitive bidding.

Hindu nationalist Bharatiya Janata Party lawmakers and other opposition leaders targeted Prime Minister Manmohan Singh because he was running the coal ministry during the 2004 sale. The auditor's report exonerated Singh, but it estimated that private companies got a windfall profit of $34 billion because of the low prices they paid for the coal fields.

Parliamentary Affairs Minister Pawan Bansal said Singh wasn't going to resign. The two houses were adjourned for the day after the opposition blocked proceedings.

Singh later said the government was ready for any debate in parliament. "We can give satisfactory answers to all issues being raised," the Press Trust of India news agency quoted Singh as saying.

Singh's government has been floundering under a crush of scams and corruption accusations over the past year and has been unable to push through crucial economic reforms. A raft of scandals have surfaced, such as corruption charges made against ministers and senior officials over the hosting of the 2010 Commonwealth Games and an earlier audit that found India's treasury lost billions of dollars through the government's haphazard sale of cellphone spectrum.

The latest report by the Comptroller and Auditor General said last week the allocations of coal fields were made on the recommendation of state governments and exonerated Prime Minister Singh.

Gurudas Dasgupta, a Communist Party of India leader, said the ministry was under Singh's charge and he should accept responsibility. "I leave the question of Singh's resignation to his conscience."

Yashwant Sinha, a Bharatiya Janata Party leader, said his party could not overlook such a huge loss to the exchequer. "Nothing short of the prime minister's resignation will satisfy us."

The audit revealed that 142 coal fields were sold after July 2004 to private and state-run companies. Some of the coalfields bought by private companies in 2004 did not begin production till 2011, while some companies later made enormous profits by selling the mines.

The report criticized the sales procedure and said the allocation of coal fields "lacked transparency and objectivity."

Last week, Coal Minister Sriprakash Jaiswal defended the government's strategy of handing out coalfields to companies without resorting to an auction process by saying the policies were suited to the time when they were adopted.

He also disagreed with the CAG's estimate of losses, saying these were unexplored coalfields.

URL

http://www.foxnews.com/world/2012/08/21/coal-scandal-blackens-india-government/