India's government tried to woo a regional party on Wednesday and secure a parliamentary majority amid signs its communist allies would withdraw their support to protest a nuclear deal with the US.
National security adviser M K Narayanan is due to meet leaders of the Samajwadi Party later on Wednesday to try to persuade it to back the civilian nuclear deal, seen as a landmark accord moving India's trade and diplomatic relations closer to the West.
Left parties have given the Congress-led ruling coalition a parliamentary majority over the past four years. But they say they will withdraw support if Prime Minister Manmohan Singh moves ahead with a deal they believe makes India a Washington pawn.
The pact, which gives India access to US nuclear fuel and technology, is potentially worth billions of dollars to US and European nuclear supplier companies and would give India more energy alternatives to drive a booming, trillion-dollar economy.
If they withdraw, the government needs the support of the Samajwadi Party (SP), a socialist party in Uttar Pradesh state with strong Muslim backing, to avoid losing a vote of confidence in parliament and facing an early election later this year.
Fearful the fall of the government could open the way to power for the main opposition, the Hindu-nationalist Bharatiya Janata Party (BJP), the SP has hinted it is willing to negotiate with the centre-left Congress.
"We always aim to keep the communal forces (the Hindu-nationalist opposition) at bay," SP head Mulayam Singh told Reuters on Tuesday night. "For that there are no political untouchables for us."
Congress leaders appeared upbeat at a conference in New Delhi on Wednesday. Some were even smiling.
"We do not want to draw the line from our side and close doors," said senior Congress leader Veerappa Moily. "But we are always capable of resolving any crisis and, when such a situation arises, we are not that weak."
The SP has 39 seats, compared with 59 for the communist parties, in the national parliament. The Congress-led ruling coalition needs the support of 44 lawmakers to reach a majority and hopes to also win support from a few smaller parties.
The government wants to avoid an early election, worried inflation at a 13-year-high and signs of an economic slowdown will destroy its chances.
It would prefer polls on schedule in May 2009, which would give it time to slow the rise in consumer prices which has stoked voter anger against the government. Some analysts say early elections may not be imminent as signs grow of the SP supporting the government.
"I think elections could at the earliest be held at the year-end when inflation is down," said Sudha Pai of the Centre for Political Studies at the Jawaharlal Nehru University.
The government faces a series of other problems, including an indefinite strike from Wednesday by millions of truckers to protest rising fuel prices, and violent protests by Muslims and Hindus in Indian Kashmir over a religious land dispute.
On Tuesday, Indian shares fell 3.7 percent as a cocktail of high oil prices, inflation and political uncertainty took its toll, with investors worried months of coalition-building and electioneering could lead to weak economic leadership. In afternoon trading on Wednesday, stocks jumped 5 percent on bargain hunting and rises in the European market.
The four left parties that prop up the government will hold a meeting on Friday to discuss the prime minister's trip to a G8 summit next week in Japan.
For the communists, his trip could symbolise a decision to move ahead with one of his most important diplomatic policies and for which he shook hands with President George W. Bush at the White House in 2005. The prime minister says he wants the left to allow him to move ahead getting clearances from the Internation