A senior Indian opposition politician will run the capital from his prison cell, a senior aide said Tuesday, facing down growing calls by rivals demanding he resign.

Arvind Kejriwal, chief minister of New Delhi and a key leader in an opposition alliance formed to compete against Prime Minister Narendra Modi in upcoming elections, was arrested on Thursday in connection with a long-running corruption probe.

Atishi Marlena Singh, New Delhi's education minister and fellow member of Kejriwal's Aam Aadmi Party (Common Man Party, AAP), said "statutory and constitutional provisions" allowed him to remain in his post while behind bars.

"We are very clear that Arvind Kejriwal will remain the chief minister of Delhi," Singh, 42, told AFP.

"If he were to resign when there's been no trial and no conviction, it opens up the route for other opposition chief ministers to be removed," she added.

India's main financial investigation agency, the Enforcement Directorate (ED), which arrested Kejriwal, has launched probes into at least four other state chief ministers or their family members.

All the investigations involve political opponents of Modi's ruling Bharatiya Janata Party (BJP).

While Modi enjoys high levels of support among his backers, critics accuse him of using law enforcement agencies to intimidate opposition leaders.

Kejriwal, 55, denies the charges against him.

His supporters, who held a rally in the city on Tuesday demanding his release, say charges against him are politically motivated and aimed at sidelining challengers of Modi ahead of the polls.

Modi's political opponents and international rights groups have long sounded the alarm on India's shrinking democratic space.

"All the centre has to do is file some fake cases, and then the ED goes and arrests them", according to Singh.

Nearly a billion Indians will vote to elect a new government in six-week-long parliamentary elections starting on April 19, the largest democratic exercise in the world.

Many analysts see Modi's re-election as a foregone conclusion, partly due to the resonance of his assertive Hindu-nationalist politics with members of the country's majority faith.

Hundreds of BJP loyalists held a rival march through New Delhi on Tuesday, chanting support for Modi and demanding Kejriwal resign.

"You can run a gang from jail but not a government," BJP lawmaker Manoj Tiwari told the crowd. "A government cannot be run from prison".

In February, Jharkhand state's chief minister Hemant Soren was arrested and jailed on corruption charges.

Soren, who denies all charges, resigned and handed power to a colleague.