The VHP workers in Kandamal observed the first death anniversary of their leader, Swami Laxmananand, on Thursday. His killing a year ago had sparked off a wave of anti-Christian violence in the district.

Now, in a major embarrassment for New Delhi, a US government commission has placed India on a watch list along with countries like Somalia and Afghanistan for what it calls a disturbing increase in communal violence. Kandhmal and the riots in Gujarat have been specifically cited.

The commission whose members are Republicans and Democrats, appointed by the President said, "It is extremely disappointing that India has done so little to protect and bring justice to its religious minorities under siege. In both Orissa and Gujarat, perpetrators are rarely brought to justice."

India has reacted sharply, calling the report regrettable.

"We don't need lessons from outside bodies," MoS, External Affairs, Shashi Tharoor said.

But despite that snub from the government, Indian officials admit that the country's credibility is hurt and a report like this can be used for India bashing at international forums.