PM Singh keeps key ministers; fresh focus on rural vote

(Reuters) - Prime Minister Manmohan Singh retained key allies in a cabinet reshuffle on Tuesday, shunning big changes in a bid to hold onto power amid charges of graft and policy paralysis.
In his second cabinet revamp this year, the beleaguered prime minister shied away from his pledge of a major shakeup, choosing instead to focus on gaining rural support ahead of 2012 state elections.
He retained his influential but often troublesome finance and interior ministers, a sign that stalled economic and political reforms were unlikely to be fast-tracked soon.
Tweaks to the government were seen as an attempt to remove some underperforming ministers and prepare the ruling Congress party for a key election in Uttar Pradesh next year, India's largest state with some 200 million people, a vote seen as setting the stage for the general election in 2014.
"I don't think it is a big-ticket change. I mean there have been some changes at the margin. It could be that part of this exercise is with an eye on the U.P. elections," said Sonal Verma, a Mumbai-based economist at Nomura, who still expected some economic reforms in the near-term.
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The Congress party-led government has repeatedly promised new policies including opening the retail sector to foreign investment, simplifying the taxation structure and land acquisition laws.
Singh did recently cut fuel subsidies, a sign that the government can push difficult decisions it if so wishes.
Bond and stock markets in Mumbai did not react to the reshuffle as those ministers who handle one of the world's fastest growing emerging markets were kept in their posts.
MAVERICK MOVED ON
In one surprise appointment, the maverick Jairam Ramesh was moved to the rural development ministry from environment, a change expected to be welcomed by business.
As environment minister Ramesh held up multi-billion-dollar investments into the steel, infrastructure, mining and power sectors by strictly enforcing green laws, displeasing big business and worrying investors.
Ramesh is believed to be close to Congress president Sonia Gandhi, the power behind the government, but has had differences with the prime minister.
The rural development ministry, which looks after an expensive job guarantee scheme popular with the poor, is central to the ruling party's strategy to keep its rural voter base.
Singh is likely to face a hostile monsoon session in parliament from Aug. 1 when opposition parties are expected to press the government on corruption and inflation, currently the highest in any major Asian economy.
Voter discontent in India has steadily grown after one corruption scandal after another have embroiled the government. The former telecoms minister is under arrest over accusations of taking bribes in a scandal that may have cost the state $39 billion in lost revenues.
Left-of-centre Congress has traditionally relied on the rural poor for votes and the tweaks in the cabinet suggest Gandhi wants to ensure the recent scandals, coupled with soaring inflation will not lead to a loss of support in coming years.

Keywords: MANMOHAN SINGH | UPA | POLOTICS

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4:03 AM | 0 comments

DMK-Congress alliance will continue said by Pranab | Pranab meets Karunanidhi

CHENNAI(TOI): Two days after DMK leader Dayanidhi Maran resigned as textiles minister, finance minister Pranab Mukherjee met DMK chief M. Karunanidhi on Saturday and said the alliance between the two parties "will continue", amid speculation over an impending Union Cabinet reshuffle early next week,

"There is a lot of speculation whether the alliance between the Congress and the DMK is on and I want to say that this alliance is there. The alliance will continue and it will be strengthened," Mukherjee told reporters after the meeting here, IANS reported.

"This is my third visit to Chennai after the state assembly elections (held in April) and therefore I took the opportunity to meet Karunanidhi and explain the current political situation to him," he added.

Maran resigned on Thursday as textiles minister in the wake of the Central Bureau of Investigation (CBI) report about his role in the 2G spectrum scam.

There was speculation that Mukherjeee met the DMK patriarch apparently to know about the party's choice for replacements for Maran and A Raja, who had earlier quit over the scam. At present, the UPA's key regional ally has only one representation in the cabinet, M K Alagiri, son of Karunanidhi.

This was the first high level meeting between Congress and the DMK in recent weeks after Karunanidhi's daughter Kanimozhi was arrested over the 2G spectrum allocation scam that has left the DMK patriarch sulking.

Karunanidhi, who recently met Kanimozhi in the Tihar jail for the second time, skipped the second anniversary celebrations of the UPA government, choosing to depute former minister T R Baalu. He also did not meet Sonia Gandhi , indicating the growing strains between the two allies.

For the record, Baalu, the DMK Parliamentary party leader, indicated the party was not in a hurry and would not seek any replacements for the time being for Maran and Raja.

Before Mukherjee arrived at Karunanidhi's residence, Maran met Karunanidhi for the second time since his arrival from Delhi last night, when he briefed him about the developments surrounding his resignation.

Maran's exit comes at a time when the ties between Congress and DMK are under strain and reports said Mukherjee's visit here was also to "assuage" the feelings of Karunanidhi, particularly over the arrest of Kanimozhi.

Maran quit the Cabinet a day after the CBI told the Supreme Court that he had 'forced' telecom promoter C Sivasankaran to sell his company Aircel to a Malaysian firm when he was the telecom minister in 2006. 

Keywords :Pranab Mukherjee | Karunanidhi  |DMK | UPS  |  

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12:55 AM | 0 comments

Maran delayed spectrum allotment to Aircel, CBI tells apex court

A day after he was nailed by the CBI in the 2G spectrum allocation scam, DMK leader Dayanidhi Maran's fate is likely to be decided anytime soon. All eyes are on Prime Minister Manmohan Singh on whether he will drop Maran from the Union cabinet.

According to Times Now, Maran left the Prime Minister's residence 7 Race Course Road, where the meeting was being held, soon after the meeting ended.

Meanwhile, opposition leader Arun Jaitley said that Maran has run out of options and he should quit. He further added that the Prime Minister cannot look away after the developments in connection with the 2G scam.

AIADMK too has said that there is no use expecting Maran to take responsibility and Prime Minister should simply drop him from the Cabinet.

Sources suggest that Maran's party is not in a position to defend him and feels he can defend himself best.

Earlier on Wednesday, the CBI told the Supreme Court that its preliminary inquiry into the allegation of Sivasankaran, a serial entrepreneur known as Siva in business circles, suggested that Maran starved Aircel of new licences to bully him into selling out.

Sources tell Times Now that the government is mulling over options of Maran's fate. Congress sources said that if an FIR is filed against Maran then his position will become untenable.

Dayanidhi Maran hold the position of textiles minister.

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1:28 AM | 0 comments