Minister drags PM into India corruption trial

A former telecommunications minister facing trial in India's biggest corruption scandal deflected blame onto the prime minister in court on Monday, saying Manmohan Singh had knowledge of a key decision, media quoted him as telling a top court.

The pre-trial comments put the government on the defensive after efforts by Singh to move past a series of damaging corruption scandals that have paralysed government policy-making and hurt foreign investment in Asia's third largest economy.

Andimuthu Raja appeared in court in the Indian capital denying wrongdoing in a case over the alleged manipulation of the sale of 2G telecoms spectrum licences in 2007-8 when he was telecommunications minister.

Raja, a member of a party in the coalition government, has been charged with flouting telecoms rules and accepting bribes to favour some firms when they sought lucrative mobile phone licences at rock bottom prices, possibly causing the state losses of $39 billion in revenue.

Shortly after the licences were sold on a first-come-first-serve basis a number of foreign companies, including Norway's Telenor and Etisalat , bought stakes in the Indian companies at much higher prices, hence prosecutors believe a crime was committed.

"Where is the crime? Where is the conspiracy? Telenor buying a stake in Unitech Wireless and Etisalat buying a stake in (DB Group's telecoms venture) was totally legal as per the corporate law," Raja said, according to NDTV news channel.

"The finance minister approved the sale in the presence of the PM. Let the prime minister deny it," Raja said.

"What the telecom companies do after I gave them spectrum is not my domain," he said.

Executives from Reliance Anil Dhirubhai Ambani (ADA) Group and the Indian joint venture partners of Norway's Telenor and the Etisalat are among those charged by police in the case.

All of the accused deny the charges.

Ministers from the ruling Congress party were immediately deployed to say no such divestment had taken place and accused the opposition of seeking to derail the parliamentary session.

PARLIAMENT PARALYSIS THREAT?

The main opposition Bharatiya Janata Party (BJP) seized on Raja's comments demanding Singh's resignation. That demand could be an ominous portent for the government gearing up to introduce major reform bills such as on land acquisition in the next session of parliament, which starts on Aug. 1.

The Congress party, the largest in the coalition government, has sought several times to distance itself from the telecoms fiasco, a case that has damaged relations with a key southern ally and pricked investor confidence.

"They are preparing the ground because it's the ideology of the BJP not to allow parliament to function," the current telecoms minister Kapil Sibal said. "They want a paralysis ... because they want to hit headlines of newspapers."

A lawmaker from the southern state of Tamil Nadu, who is the daughter of the head of Raja's DMK party, has also been charged with handling $45 million worth of bribes in connection with the 2G scandal. She has denied any wrongdoing.

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