Congress, stung by graft allegations and food inflation that have hit its approval ratings, hopes to gain the initiative over the Bharatya Janata Party (BJP) after a report linking alleged Hindu militant bombers with its ideological parent organization.
The stakes for Asia's third largest economy are huge.
Congress depends on regional parties from West Bengal and Tamil Nadu for its majority parliamentary coalition. Any failure in those state elections may hurt Congress's ability to hold its coalition together ahead of a 2014 general election.
At the weekend, the BJP pledged to make corruption its election plank, scenting victory after a $39 billion telecoms scandal sparked the firing of a minister belonging to Congress's Tamil Nadu ally, weakening the coalition.
The BJP offensive, which blocked many parliamentary sessions last year, may now come up against allegations Hindus from the BJP's ideological parent organization, Rashtriya Swayamsevak Sangh (RSS), were behind bombings first blamed on Islamists.
"Congress will hope the Hindu terror allegations links to the RSS will draw attention from its own problems of corruption and price rises," said political analyst Mahesh Rangarajan.
"Whether it works is another matter."
Since re-election in 2009, Congress appears to have lurched from one crisis to another. With food inflation at a year high and Prime Minister Manmohan Singh himself criticized over the telecoms scandal, little has gone its way. Until now.
Tehelka magazine printed the confession of Swami Asimanand, head of a RSS-affiliated group who was implicated in a bombing. He confessed Hindu militants were involved in bombings of a train to Pakistan, a mosque, a shrine and a Muslim-majority town.
Islamist groups were initially suspected for the blasts aimed at fomenting religious divides in Hindu-majority India, where about 13 percent of the more than 1.1 billion population is Muslim.
In the bombings of Malegaon town in 2008 and a Hyderabad mosque in 2007, several Muslim youths were arrested in connection with the attacks and most remain in jail. There were accusations many had been tortured while in custody.
Accusations Hindus may be behind attacks strikes at the heart of India, where Pakistan-inspired Islamists are often blamed for attacks. The BJP has long campaigned on what it says is Congress's softness in dealing with violence.
The Tehelka report put the BJP, in power from 1998 to 2004 before losing 2004 and 2009 general elections, on the back foot.
Even before the report, Congress family scion Rahul Gandhi and possible successor to Prime Minister Singh had compared the RSS with militant groups.
After the BJP attacked Congress party leader Sonia Gandhi for her family links to a weapons contract graft scandal that had brought down a Congress government in 1989, the Congress party reacted with its Hindu terror card.
Congress's RSS allegations were then attacked by BJP President Nitin Gadkari as "a conspiracy by the Gandhi family."
The tit-for-tat charges highlight how Congress feels BJP ties with the RSS is its weak link.
Critics see RSS as a murky paramilitary group and its members still wear trademark khaki shorts and white T-shirts. RSS supporters see it behind cultural and voluntary programs.
While nearly every BJP leader has been a RSS member, its Hindu ideology is seen by critics as politically outdated and the debate about how to respond to the RSS allegations strikes at the political identity of the BJP in a modernizing India.
BJP leaders want to focus on the economy, clean government and middle classes to win national elections. They know that talk of Hindu extremism does nothing to win over millions of rapidly modernizing urban Indians.
But the BJP is loath to disown a group that has huge grassroots support among its followers.
"It is time the BJP got out of its denial mode and acknowledged the threat that Hindutva terror poses to the country," Mail Today said in an editorial on Monday.
It remains to be seen if RSS allegations will help Congress.
Congress would like it to divert attention from corruption and prices, and make secular, regional parties more cautious about joining the BJP to form any new coalition to fight elections — crucial if it will ever regain national office.
Last month, food prices rose by their highest in a year, and the benefits of an economic boom may not be felt by the Congress party key supporters — the poor.
A poll last week showed Congress would lose 40 seats and make it a minority government if elections were held.
Corruption allegations also feed into a perception the rich benefit more from economic growth of nearly 9 percent. The BJP has said it could continue to disrupt parliamentary proceedings in the February budget session.
"These prices rises really have no precedent," said Rangarajan. "And the government seems at a loss how to deal with it. It is really time for the opposition to rally."
