Scam versus scam politics stalls India's reform agenda

NEW DELHI (Reuters) - India's premier political parties have come up with a new strategy to get even with each other - scam versus scam.

Since the monsoon sitting of parliament began on Tuesday, the ruling Bharatiya Janata Party (BJP) and the main opposition Congress party have been trying to outdo each other with accusations of who is the most corrupt.

While the strategy is meant to blunt allegations of impropriety levelled against Prime Minister Narendra Modi's party and ministers, it has paralysed the new session of parliament, casting doubts on the fate of a landmark tax reform.

The passage of the measure should pave the way for the biggest overhaul of taxes since independence in 1947 and reassure investors who are growing impatient with the slow pace of economic reforms.

But every day since Tuesday, opposition lawmakers led by the Congress party have stormed the chamber and forced the speaker to halt proceedings.

They are demanding Prime Minister Narendra Modi sack his foreign minister and a state leader for alleged favours given to a sports tycoon living in London who faces allegations of tax evasion. The leaders deny wrongdoing.

But in India's notoriously grubby politics, there is plenty of mud to sling. So in its response, every afternoon, the BJP has raised alleged scams by chief ministers of Congress-ruled states.

The party made graft allegations on Thursday against Virbhadra Singh, the chief minister of Himachal Pradesh. On Wednesday, it accused Harish Rawat, Uttarkhand's chief minister, of changing government policy on granting liquor licenses to make profits.

"Those who are making charges against us, will they ask their own chief ministers to resign?" asked Telecoms Minister Ravi Shankar Prasad.

Both the Congress leaders have denied the charges.

Congress is also gunning for Shivraj Singh Chouhan, the chief minister of Madhya Pradesh, governed by Modi's party, over the deaths of witnesses involved in a massive fraud in entrance exams for college and government jobs.

Congress vice president Rahul Gandhi said the party would not relent without their removal. "No discussion without resignation," he insisted on Thursday.

Political opposition has already forced Modi to defer the passage of a business-friendly land purchase law. His inability to pass key reforms have dimmed economic prospects, a Reuters poll showed.

A delay in passing the tax reform would only further undermine investor confidence.

(Reporting by Rajesh Kumar Singh; Editing by Frank Jack Daniel and Tom Heneghan)