Sheila Dikshit under fire over graft allegations

Bharatiya Janata Party (BJP) has demanded the resignation of Delhi's chief minister in connection with graft allegations in the 2010 Commonwealth Games, in another attack on the government struggling to push reforms in parliament.

A state auditor has slammed Sheila Dikshit, a stalwart in the ruling Congress party, for overseeing "ill-conceived and ill-planned" projects and unduly favouring certain firms for contracts, according to segments leaked to the local media.

A separate row is also brewing over land which farmers say has been wrenched from them by a charitable trust whose trustees include Sonia Gandhi, the head of Congress and the country's most powerful politician, and Prime Minister Manmohan Singh.

Political wrangling over corruption has threatened to disrupt the August session of parliament in which Singh's government is pushing landmark economic reforms such as on land acquisition. Opposition-led protests against a string of graft scandals shut down parliament for much of the year.

There was no major disruption in parliament on Wednesday from the latest allegations, with business focused on a debate over high inflation.

A controversial bill, which would give an independent ombudsman powers to crack down harder on corruption, is due to be tabled in parliament on Thursday.

The state auditor's report, which is due to be tabled in parliament shortly, reopens sores over the government's chaotic handling of hosting the world's third-biggest multi-sport event, which was mired by rows over corruption and incompetence.

"Not only do we demand the immediate resignation of Sheila Dikshit, but we demand that a strong prosecution case be instituted against her and all those accomplices of her who were involved in this scandal," Tarun Vijay, a spokesman for the main opposition BJP, told the Indian news channel Times Now.

Sheila Dikshit has denied any wrongdoing in her role in organising last October's Games. The event's chief organiser, another Congress party big-hitter, is in jail pending trial charged with cheating in tenders for timing equipment worth millions of dollars.

"Everything was done keeping in mind national interest and prestige," Dikshit was quoted as saying on Wednesday. "We were entrusted with certain responsibilities and we delivered them."

The Commonwealth Games were meant to showcase India's confidence as an emerging global giant vying with the likes of China.

Singh's coalition has reeled from corruption scandals worth billions of dollars in the past year, which have dented confidence in his government's ability to steer reforms and sustain the growth momentum of Asia's third-largest economy.

"The Delhi Commonwealth Games 2010 were supposed to celebrate sport while showcasing the capital city of a rising nation," an editorial in the Times of India said on Thursday.

"But the mega-event's legacy isn't shining. As investigations into the organising of the Games continue, the corruption taint is spreading."

The right-wing BJP has sought to make political capital out of the scandals, shutting down parliament with protests and leading street demonstrations. But it has itself been put on the back foot by an illegal mining scandal that saw the resignation of its chief minister in Karnataka state.