Indian government sees off bribery charge to seal nuclear deal with US

The historic nuclear deal between India and America is set to proceed after the Indian government survived a bitterly-fought vote of confidence, despite dramatic last-minute allegations of bribery by opposition MPs.

The coalition government of Prime Minister Manmohan Singh and Congress Party leader Sonia Gandhi won the ballot by 275 votes to 256 – a surprisingly comfortable margin of 19. The outcome means the administration will push swiftly ahead with the co-operation deal ahead of a general election that must be called by May next year.

However, minutes before MPs voted yesterday evening, opposition politicians sought to derail Mr Singh by waving wads of cash on the floor of the parliament building and claiming that the government had tried to bribe them to abstain. The already raucous chamber erupted with cries of outrage from both sides.

Such was the level of heckling that the Prime Minister was forced to submit his closing remarks in writing, rather than saying them. Several former Indian parliamentary officials described the scenes as a low-point in the history of the assembly.

India prides itself on its vibrant if usually chaotic democracy. But the so-called trust vote – triggered two weeks ago by the decision of a group of Communist parties to end their support for the ruling coalition – has been mired by widespread allegations of bribery and horse-trading.

MPs from both sides claimed to have been offered millions of pounds to vote either for or against the government, while the coalition has also offered senior government positions to the leaders of smaller parties to shore up its support. Mr Singh has said he will support an inquiry into the allegations of bribery.

The red, sandstone parliament building in the heart of Delhi, designed by the British architects Sir Edwin Lutyens and Sir Herbert Baker, has been home to many dramas since it was inaugurated in 1927. In 1947, it was the location of the official handover of sovereignty from Britain to India when the country won independence, while in 2001 it was the scene of a suicide bombing that killed 12 people.

Yesterday, it was the scene of a spectacle that saw half a dozen jailed MPs temporarily released and permitted to vote, several other politicians brought in from hospital and at least one wheeled in on a stretcher. On what felt like one of the hottest days of the year, one MP whose allegiance was in doubt was seen arriving in an official car in the company of senior party officials who all but strong-armed him inside.

For the government, it was all worth it. After his victory was announced, Mr Singh said: "This will send a message to the world at large that India's head and heart is sound, that India is prepared to take its rightful place in the comity of nations. I have always said the deal was important and now we know it."

Yet while the Prime Minister, who in the 1990s was the architect of his country's economic reforms, may have been willing to risk possible defeat over the nuclear co-operation deal, it is still unclear whether the issue has much resonance beyond India's political classes. With inflation touching 12 per cent and the cost of rice, wheat flour and petrol soaring, most ordinary Indians appeared to attach little importance to the issue, even if they knew the vote was taking place. "All I am thinking about is that the cost of everything is too expensive," said Anil Shukra, a shopkeeper in south Delhi.

The nuclear deal will give India access to American technology and nuclear fuel, despite the fact that India is not a signatory of the Non-Proliferation Treaty and conducted nuclear tests in 1974 and 1998. It could also see an additional investment of up to $40bn over the next 15 years.

"It is a clear victory and an endorsement of the nuclear deal," said Mahesh Rangarajan, a political analyst. "But the bribery scandal will come back. Expect an opposition offensive in the coming weeks."

A number of left-wing parties which had previously voted with the ruling coalition argued that the deal carried "imperialist" strings that would give the US too much influence over India's foreign and domestic policies. Others said the deal was unnecessary as India could obtain nuclear fuel from elsewhere. The question for the government now is how long it waits before calling an election. Its main opponent, the Hindu-nationalist Bharatiya Janata Party, will have been disappointed by yesterday's result but will still believe it could beat the government nationally.

In the closing remarks he issued in his statement, Mr Singh accused the BJP leader, Lal Krishna Advani, 80, of leading three attempts to try and dislodge the government. "But on each occasion his astrologers have misled him. This pattern, I am sure, will be repeated today," he said.

"At his ripe old age, I do not expect Mr Advani to change his thinking. But for his sake and India's sake, I urge him at least to change his astrologers so that he gets more accurate predictions of things to come."

So what happens now?

The Indian government is keen to complete the co-operation deal with the US before George Bush leaves office in January. Having survived the confidence vote, it will seek to have the accord approved by the International Atomic Energy Agency (IAEA) and the Nuclear Suppliers Group, a requirement before the US Congress can ratify it. The IAEA will vote 1 August on whether to endorse the plan, which will give its inspectors access to 14 Indian atomic reactors – a key condition for the treaty. By avoiding an early election, Prime Minister Singh also has a chance to ease rules on foreign investment, which his Communist allies had opposed. He says the deal will increase nuclear generation 10-fold and end the almost daily power blackouts. The lack of electricity has cut an estimated 2 per cent from India's annual economic growth rate, which has recently fallen by one point to about 8 per cent.