UPDATE 3-India PM says gov't not involved in vote-buying

Fri Mar 18, 2011 2:20pm IST

* WikiLeaks disclosures latest scandal

* Parliament adjourned for second day over allegations

(Adds Prime Minister statement)

By C.J. Kuncheria and Henry Foy

NEW DELHI, March 18 (Reuters) - Indian Prime Minister Manmohan Singh said on Friday that no government members were involved in vote-buying to win a confidence vote in 2008 and doubted the veracity of the claims, defying resignation calls over the issue.

The scandal over cash for votes is unlikely to immediately endanger Singh's government, but it increases the pressure on Singh already battling allegations of graft in cases ranging from grant of telecom licenses to apartments for war widows.

The opposition forced parliament to adjourn for a few hours on Friday, demanding Singh resign after a U.S. diplomatic cable obtained by WikiLeaks said his ruling Congress party paid bribes to win the confidence vote in parliament.

"No one from the Congress Party or the government indulged in any unlawful act during the trust vote ... The government rejects the allegation as absolutely false," Singh said in a statement to India's upper house of parliament.

"I have not authorised anyone to purchase any votes," Singh told a conference earlier on Friday.

Newspaper editorials said the report was unlikely to affect government stability as the charges were old.

But with Singh's reputation as an honest elder statesman tarnished, the political space for reforms such as opening up the supermarket sector to foreign investors and the deregulation of diesel prices will further shrink, analysts said.

The U.S. diplomatic cable said a senior Congress party official told an embassy official that four lawmakers of a regional party had been paid 100 million rupees ($2.2 million) each to secure their support in the vote, which Singh won.

The report's contents were "unverified and unverifiable," Singh told lawmakers. A spokeswoman of the U.S. embassy in New Delhi said they did not comment on classified material and could not comment on the report's authenticity. [ID:nSGE72G020].

The Congress party has been hit by a series of corruption scandals, chiefly a $39 billion telecoms scam in which mobile phone licenses were sold at rock bottom prices. The telecommunications minister A. Raja has been sacked and is in prison facing charges.

The government is also battling a loans-for-bribes bank scandal and allegations that apartments meant for war widows were diverted to bureaucrats.

The main opposition Bharatiya Janata Party which has stepped up pressure on the coalition said Singh had lost the moral responsibility to govern following the latest revelations.

(Addtional reporting by Manoj Kumar; Editing by Alistair Scrutton and Sanjeev Miglani)