Thousands back Anna Hazare's hunger strike; govt offers deal

School children, holding the Indian national flag and flowers, walk past social activist Anna Hazare in support of a ''fast unto death'' campaign in New Delhi April 7, 2011.

NEW DELHI (Reuters) - Students in T-shirts and Sikhs in turbans and carrying swords rallied alongside peasants and executives on Friday in support of activist Anna Hazare's hunger strike against corruption, as the government and protest leaders neared a deal on the Lokpal bill.

Septuagenarian Hazare's campaign draws on widespread public anger over a spate of corruption scandals that have emerged in Prime Minister Manmohan Singh's second term, tarnishing the government's image and spooking investors.

The biggest scandal involves charges that rule violations during a 2007-08 grant of telecoms licences may have cost the government as much as $39 billion in lost revenue. The then-telecoms minister Andimuthu Raja has been forced to resign and has been arrested.

Hazare has been fasting since Tuesday on a street-side platform in the shadow of New Delhi's Jantar Mantar, demanding the government enact the Jan Lokpal bill, a stringent anti-corruption law.

Crowds in the capital and other cities across the country have swelled each day, with word being spread through extensive media coverage, text messages and social networking sites like Facebook and Twitter.

On Friday, the thousands gathered before Hazare shouted anti-graft and anti-government slogans, vowing not to yield until the Congress-led coalition government agrees to their demands.

Protesters held up banners that read: "It's the talk on the streets, my leader is a thief". Badges read: "Manmohan Singh want my vote? Support the Jan Lokpal Bill."

Hazare has demanded that members of civil society sit with ministers to draft the bill, which would give an independent ombudsman police-like powers to prosecute ministers, bureaucrats and judges.

"The people's voice has reached your (government's) ears. If you remain deaf, the people will teach you a lesson," Hazare told his supporters, to loud cheers.

"This bill will come, whatever the sacrifice it needs. I am ready for that sacrifice," said the slight Hazare, clad in a white tunic and trousers and a Gandhi cap.

The protesters initially wanted their nominee to head the committee drafting the bill, while the government said it would be headed by a minister. Hazare later said he was willing for his nominee to be the co-chair along with the minister.

Emerging from negotiations with a government minister, Hazare's emissary hinted at a solution.

"We are going to Anna now. Anna will take a call and will announce his decision. You will be very happy to know his decision," Swami Agnivesh told reporters late on Friday.

Earlier, Sonia Gandhi, the president of the ruling Congress party who is seen as the power behind the government, said she was sure the government would pay heed to the views of Hazare and appealed to him to end his fast.

India ranked 78th on Transparency International's latest corruption index, a worse ranking than Asian rival China. Graft has long been a part of daily life.

EVOKING GANDHI

Hazare's campaign has drawn comparisons to Mahatma Gandhi's protests and hunger strikes that helped end British colonial rule. Hazare has termed the movement against graft a second freedom struggle.

"1857 revolution, 1947 freedom, 2011 lokpal," read a slogan on a banner, referring to a 19th century revolt against British rule and the year India got independence.

While Hazare's movement does not seek to overthrow the democratically elected government and has not sought political support, it adds to voter anger against the Congress party.

Demonstrations of support in other cities, including Hyderabad, Bangalore and Mumbai, drew several thousand people in all, residents said.

Hazare has said he will not break his fast until his demands are met. On Friday, he said he could easily go on for another six days without food and urged his supporters to stand firm.

He has in the past fasted for as long as 12 days in his home state of Maharashtra against corruption and for the enactment of a right-to-information law.

"Do not let this revolutionary fire go out. There are more problems to be faced ahead," he said on Friday. "We have to move forward and beyond this bill, until the poor get justice."

(Writing by C.J. Kuncheria; Editing by Andrew Marshall)