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LONDON, England (CNN) -- A British television channel boss has said "Celebrity Big Brother" will stay on the air despite a row over the alleged "racist" treatment of an Indian actress on the show.
But shortly before Channel 4 chief executive Andy Duncan made his defiant statement mobile phone giant Carphone Warehouse suspended its sponsorship of the show because of the controversy.
The company ordered Channel 4 to remove its name and branding from the program with immediate effect. (Full story)
Speaking to reporters in Oxford on Thursday Duncan defended the decision to continue broadcasting the reality TV show, saying the issues raised were "unquestionably a good thing."
He insisted the show would continue to be broadcast, saying it was unclear if the abuse was racist in nature. He said Bollywood star Shilpa Shetty did not believe it was.
On Channel 4 on Thursday night, Shilpa, 31, is seen saying the behavior of her housemates was not racist.
She says: "You know, when I actually thought about it, I know it's not a racist thing. I thought about it for a long time. It's not racist. You know people say things in anger.
"She tries to challenge me. She tries to challenge my beliefs."
Tens of thousands of complaints have flooded in since former "Big Brother" winner Jade Goody and other housemates allegedly began bullying the Indian star.
Goody is seen on the show Thursday calling Shilpa "poppadom."
In the Diary Room, Big Brother asked Jade about the conversation with Danielle, in which she referred to Shilpa as Shilpa poppadom.
Jade said: "Shilpa poppadom. I explained that for the other two trying to get her name out. Her name is not Shilpa Harry or Shilpa Tweed or Shilpa Mackintosh, she is Indian, so will have an Indian name. No racial anything.
"She is Indian, thinking of an Indian name and only thing I could think of was Indian food. Wasn't racial at all. It was not to offend any Indian out there.
"Everyone knows I don't like her. She don't like me. What I said about her was not meant in a racial way -- it's not acceptable if done in that way. Mine wasn't done in that way."
Mayor of London Ken Livingstone called for all housemates who have made racist comments to be evicted from the house immediately and accused Channel 4 of damaging Britain's international standing.
He dismissed Duncan's response to the controversy, saying: "Channel 4's statement today pretending that they cannot decide if there is racism in Celebrity Big Brother is absurd, and their failure to take any action to put a stop to the racism on this show is an evasion of the responsibilities of a broadcasting company.
"The withdrawal of Carphone Warehouse sponsorship is welcome and their decision should stand until the present situation on the show is ended.
"All those who have made racist comments about or towards Shilpa Shetty should be immediately evicted by Endemol. Channel 4 should have insisted on this as a minimum requirement for continuing to broadcast it."
Jade vs. Shilpa
Duncan said: "Big Brother's unique strength is that it is ultimately the public who will decide whether or not the behavior of certain contestants has been unacceptable.
"Tomorrow night Jade and Shilpa will face the public vote. The British public has the opportunity to cut through the claim and counter-claim and pass its judgment on the events of the last week."
The channel said previously there had been "no overt racial abuse or racist behavior" directed against Shetty.
Duncan said: "What constitutes racism is a complex question.
"We have been monitoring extremely carefully events in the house and have reached the view that we cannot with certainty say that the comments directed at Shilpa have been racially motivated or whether they stem from broader cultural and social differences.
"We have already intervened with Danielle and, as viewers will see tonight, again with Jade where we felt their comments might be construed to have racist overtones.
"Producers also spoke to Shilpa today who said she did not feel that behavior towards her was racist.
"We will not hesitate to intervene again if apparently racist behavior occurs."
But Duncan's remarks failed to impress Labour MP Keith Vaz, who tabled a motion in the House of Commons on the program.
Vaz said the TV boss was failing to treat the issue seriously enough. "This is not even a half-hearted apology by Channel 4 for all the distress and hurt it has caused, and clearly they still have not understood the seriousness of this issue," he told the Press Association.
The controversy continued to rage after Wednesday night's episode saw an escalation of alleged racist bullying directed at Shetty.
The actress has been repeatedly reduced to tears during the show by fellow female contestants who have mocked her cooking and her accent, and have called her a "dog."
One contestant said Indians were thin because they undercooked their food.
After footage of another row was broadcast on Wednesday night, one contestant told Shetty: "I don't think there's anything racist in it." Shetty replied: "It is, I'm telling you."
Shetty's mother said on Thursday she wished her daughter would stop enduring what she said was racist abuse on "Big Brother" and quit the show. (Full story)
Indian newspapers' splashed the story across their front pages for a second day Thursday and TV news channels ran clips of Shetty crying.
A Hindustan Times newspaper editorial said "attacks on her (Shetty) show that racism is never really far from the surface."
The row has drawn in British Prime Minister Tony Blair and other top politicians.
Blair told parliament that "we should oppose racism in all its forms." Opposition leader David Cameron urged viewers to switch off in protest and Northern Ireland Secretary Peter Hain said the attacks on Shetty were "grubby racist behavior."
Earlier, protesters burned effigies of the show's organizers on the streets of India.
The number of complaints from viewers has soared to more than 20,000, and the Indian government also indicated that it plans to raise the issue with Britain.
Channel 4 has revealed figures showing the row has boosted ratings for "Celebrity Big Brother," which had been on the decline since its opening night.
Copyright 2007 CNN. All rights reserved.This material may not be published, broadcast, rewritten, or redistributed. Associated Press contributed to this report.
Bollywood star Shilpa Shetty has been subjected to abuse.
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