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Congress Coalition in India Hit By New Scandal

Prime Minister Manmohan Singh is leading an increasingly unpopular government in New Delhi. A new scandal erupted this week, as the FT reports:

Companies run by some of India’s top industrialists received “undue benefits” worth $210bn when they bought underpriced coal assets between 2004 and 2009, according to a state audit that threatens to destabilise further Manmohan Singh’s tottering government. . . .

The public scrutiny of the coal sector, and the political infighting it has fuelled, threatens to derail the current session of parliament.

Corruption is deeply entrenched in wide sectors of the Indian political elite. The natural resources sector is particularly bereft of modern regulation, and illegal mining is a serious problem for both people and the environment.

And, as the FT notes, there are links between bad governance and the communist insurgency that troubles a large chunk of central India: “Over the past four years, the Indian government has become increasingly worried that uncontrolled mining has fuelled a rural rebellion, often under the banner of Maoist or Naxalite resistance.”

The Congress Party seems bent on its own undoing: beset by one corruption scandal after another, hampered by uncooperative coalition parties, unable to initiate ambitious financial reforms, alienating foreign investors, and dangling on the losing end of recent state elections. It is no exaggeration to say that it is stumbling into the 2014 national elections in very poor standing.

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  • Jacksonian Libertarian

    Time for some new blood, the great thing about Democracy is that the people can fire the one group of politicians and replace them with another, which knows the same thing might happen to them if they don’t produce. It is the only way the feedback of competition that makes Capitalism so successful, ever reaches into the Government Monopoly. Failed Authoritarian Governments can hang onto power for decades dragging their nation down the entire time, before they fall.

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