The Great Loot of Andhra Pradesh - Part 2

"This week, a series of media reports - including on NDTV - explored whether Jagan and Janardhana have ever formally shared business interests"

That amazing assertion has been picked up from an NDTV report, filed on September 8th,2011 will make you think some extensive research did go into "exploring" the best known open secret!

Let's briefly look at this "exploration" - Sakshi newspaper's registered address is also the registered address of two other firms, one of which has a stake in Obulapuram Mining Company owned by Gali Janardhana Reddy and the other is a iron ore trading company that invested money in Sakshi. This superb "exploration" was carried out by the media after a CBI enquiry revealed this known fact! Some snippets of this exploring report- "In June 2007, YSR was seen....at the inaguration of ... Brahmani steels". Seen? Yo NDTV - he actually inagurated it! One more - "NDTV visited the address ...". Let's leave it at there and revisit this point later in the article.

ohh, by the way, a mandatory reading before reading this piece is Part 1 , otherwise the context is not set correctly.

Bro. Anil Kumar

Can you possibly imagine the outrage on english TV media, if Yeddyurappa's father-in-law's son-in-law's nephew's sister's husband used hundred rupees of public money for a purely religious event?

Let's now get to the point :)

In 2008, suddenly we saw a spurt of banners in Hyderabad, through which we were introduced to Brother Anil Kumar.

(pic courtesy, rediff)

Many of us did not know who Bro. Anil Kumar was. Since it was around Christmas time, we thought that this was another evangelist organising a gathering. And then it was revealed that Bro. Anil Kumar is none other than the son-in-law of the Chief Minister, Y.S.Rajashekar Reddy! And now all that sudden publicity overdrive made lot of sense. The opposition parties began questioning the source of funds (not just the "communal" BJP but even "secular" TDP. so...) for Bro.Anil Kumar's little known evangelical organisation, Anil World Evangelism. Suddenly from nowhere, where is he getting the money to spend crores on publicity and is able to mobilise lakhs of people (even in other cities)? Was government machinery used for these purposes? Was undue influence used so as to favour the Chief Minister's son-in-law? How come a relatively unknown organisation, Anil World Organisation suddenly get so rich?

The Bayyaram Mining Lease

• Bayyaram is a mandal in Khammam district of Andhra Pradesh.
• The above mentioned organisation, Anil World Evangelism is registered in the same apartment complex as that of another company, Rakshana Steels.
• The Andhra Pradesh Mineral Development Corporation had entered into a joint venture agreement with - hold your breath - Rakshana Steels for mining iron ore in Khammam and Warangal districts in February 2009 when YSR was the chief minister.

Now that's an address NDTV never visited, despite there being a huge uproar in the state back in 2010! A random report was filed though. "It is alleged" blah blah.

You want to take a guess on how much land was given on lease - 1.37 lakh acres. Ofcourse, Rakhsana steels denied that Bro.Anil Kumar was holding any position in their company. Until the next day when regional newspapers published details of registered addresses of both companies in the same apartments! (unfortunately I am not able to find a snapshot of those reports. If only telugu newspapers maintained a proper archive section, life would be so much easier. Sigh!)

And so now we have the spectacle of 1.37 lakh acres of land being alloted for iron ore mining, to a company that is promoted by Bro.Anil Kumar (I won't even bother using the word "alleged" here!). Mark it in bold people - The Chief Minister's son-in-law is given a lease to mine iron ore over 1.37 lakh acres. Investigative media like the NDTV did not find the time to neither visit the address nor express outrage.

Spirited opposition attacks on the government in Assembly elicited this response from the govt. - Rakshana Steels will only transport the steel from the mining area. Actual mining will be done by the government only! And if you still insist that this is a opposition conspiracy, then you need to answer why this same Congress government at the centre cancelled the lease in August 2010 (after YSR's death and Jagan's revolt), that it only allowed in the first place?

MAYTAS Land deals

Remember Satyam? No no, am not trying to accuse YSR of the scam done by Ramalinga Raju! Ramalinga Raju's son owned MAYTAS infrastructure (reverse SATYAM and you get MAYTAS! This is how Raju created tens of bogus companies to carry out his scams - shuffle letters, rearrange them etc etc). MAYTAS was given infrastructure deals worth Rs.30,000 crore !! And they were given deals into projects that they have had no prior experience and are not some small building a mall or a road kind of projects. One project was to build a port! The other famous project, which eventually had to be scrapped and re-drawn again, was the Hyderabad metro! This article by a known opponent of the Metro rail project is very revealing as to how Maytas was getting good real estate for cheap. Out of the blue, MAYTAS was favoured. Ofcourse, after the scam broke out, when asked - YSR said that all deals have been given to consortiums so not a big problem if one of them fails!

DPEP scam

A curosry mention of this scam was made in part-1 but wanted to touch this briefly here. The person standing behind YSR in the below picture is an extremely well-known face to the people of AP.

His name is Sureedu. He was almost ALWAYS seen with YSR everywhere he goes. He had no official position till 2008. After objections from many quarters, YSR appointed him as one of his security officers and therefore his position became official! Most of us just thought he was just YSR's lucky charm or something like that.Until the DPEP scam broke out!

DPEP is the District Primary Education Program, run on funds that the central government gives to the states. By now, we are used to and have become immune to small scams in all departments and programs. When the scam first broke out, the mood was the same. A former teacher from Kadapa district, Sarasa Devi connived with an accountant Subramanyam, to open a fake bank accounts and eat money that was left over in DPEP funds. When the scam first came out, a fraud case for Rs. 7.40 crore was filed.

And guess whose name the accountant took in the investigations? He said that Sarasa Devi could run this show with the help of ..... Sureedu ! The amount maybe small, but the shock value was quite high. YSR promptly instituted a judicial commission that promptly said Sureedu is not guilty!

The EMAAR-APIIC scam

ok folks - this will be last scam to be discussed. I guess we are really reaching a break point here! There are two primary reasons for mentioning this scam.

• This scam was unearthed by a serving Congress minister in the state, D.L.Ravindra Reddy. He says that this scam can easily be estimated at Rs.10,000/- crore.
• The timing of the government raids on properties concerning this deal. Let's get into the details.

Those of us who watch TV news regularly in AP are very familiar with this man, Ambati Rambabu

Ambati Rambabu, along with a few others, were the most vociferous spokespersons of Congress party, on TV. To be frank, Rambabu is a good orator and a good argumentative guy. His rhetoric though got boring after a while. He was steadfast in supporting YSR and the congress party in all TV debates. You could see the loyalty and passion in his arguments. (A shameless plug here :) - Ambati Rambabu was on his rhetorical drive on drought situation in AP, in one of the TV debates. I could call in to the debate, and asked him only one Q - Can you list out the specific things the govt did to control this drought - guess the answer. He said, nothing specific has been done so far! This was on channel TV5 some 2 years back!).

Anyways, getting back to the point. After YSR's death, amongst all those vociferous spokespersons of the Congress party, only Rambabu voiced support for Jagan. Right from day 1, Rambabu has been scathing in his criticism of the Rosiah govt, Sonia Gandhi and high in his praise of Jagan. You should see the debates to believe his high energy levels. So now officially Rambabu is against the congress govt and is a Jagan loyalist.

And hence the witch hunt begins! Rambabu was the chairman of AP Industrial Infrastructure Coporation (APIIC). APIIC is the organisation that gives permissions for various SEZs and IT campuses to come up in the state (Now you get the importance of this position? :D). APIIC entered into a deal with EMAAR in 2002 (yeah, when TDP was in power!) to construct a township project near Hyderabad. 74% to EMAAR, 26% to APIIC. After Congress came into power, this deal was diluted in such a way that APIIC will get about 6.5%. Plus, apparently more than half the villas/plots in this township have been officially sold at Rs.5000 per sq yard, but unofficially at Rs. 45,000 per sq yard! The calculation was done by the Congress minister himself, and therefore we now had the spectacle of the Rosaih government conducting raids on establishments that entered into a deal with YSR government! Indian Express explores if APIIC is robbed left, right and centre here. Wonder why NDTV never "explored" this?

The above cited project is just example. There have been a deluge of reports in the media about more such "deals" by APIIC, only after Rambabu was kicked out from the Congress.

Everyone is clean as long as they are in Congress and hail the High Command. The minute you stop doing either of them - you become corrupt and raids happen on your establishments. So the Congress High Command was sleeping all these years?

Still if you are keen, happy cursory reading on the Outer ring road scam, temple land scam,Jalayagnam scams (also mentioned in part-1 in some detail), Nadergul land scam . Where there is land, there is a scam!

And please note again - ministers of Congress party are themselves filing cases against corruption done when Congress party was in power; office bearers of Congress party are accusing the son of their former CM of mammoth corruption!

I am not mentioning the scams that happen below the level of a minister. Those scams, though can be avoided, cannot be blamed on the Chief Minister directly. The above mentioned scams (and the ones in part-1) are mostly at the level of the Chief Minister (along with his family). And that's exactly what differentiates all this loot (by both the central and state government leaders) from all other previous corruption cases - these happened with the direct involvement and knowledge of the highest decision making authorities.

And yet YSR won. How? Coming up in the next blogpost :)

The Great Loot of Andhra Pradesh...

• The above banner headline reads: Rs. 45Cr + 3 1/2 years = Rs. 3,053.90 crores!
• The caricature is Y.S.Jagan Mohan Reddy, s/o late CM of Andhra Pradesh from Congress, Y.S.Rajasekhar Reddy.
• This headline was in the telugu newspaper, eenadu.
• This headline is not a recent one.
• And most importantly, this loot of Rs.3,000 crores is not the only loot that has been perpetuated on the people of Andhra Pradesh in the past 7 years. This is just a sample.

Let's briefly look into the math of the above headline before proceeding further to explain the growth of the YS empire. Raghuram Cements was bought over by a new company called Bharathi Cements. Bharathi is the name of Jagan Mohan Reddy's wife. The YS family gets about 4.5 crore shares alloted to them at Rs.10/- per share. Companies like India Cements, Dalmiya Cements suddenly bought premium shares for much higher amounts and invest about Rs.250 crores for a 31% share! The YS family owns 69% of the company with an investment of Rs. 45 crores. Others invested about Rs.250 crores with 31% share, into a company that hasn't even begun manufacturing! The article later goes on to explain how this 69% share holding rose in its value to about Rs. 3000/- crores in just 3 1/2 years.

The detailed math and financial transactions are way too complicated for my understanding. The route used by the companies of YS family is so circutous, it makes your mind go into a tizzy. Simple example. The company that invested 69% into Bharati Cements is Jagati Publications. Jagati Publications (named by combining Jagan's name and his wife Bharati's name) owns Sakshi newspaper. Shares were alloted to YS family in this company too, for Rs. 10/- !! Deloitte values this company for Rs.3,500 crore, and therefore the value of YS family shares jumps to thousands of crores!

Let's leave all the math jargon aside. Let's assume that all this is a propaganda by the opposition and a media that is against the Congress. Let's just go by facts present in the public domain (the charts presented below have been picked up from TDP's website, who in turn have picked it up from documents available in public domain).

Y.S Family in 2004.

YS Family ownership in 2005 (1 year after YSR became CM of AP)

YS Family ownership in 2006

YS Family ownership in 2007 (when Bharati cements also got added!)

Let's also for a moment assume that the above material presented at TDP's website is also bogus. Jagan, in his 2011 election affidavit said he has ownership in the following 11 companies!

• Sandur Power
• Saraswati Power
• Carmel Asia Holdings
• Bharathi Cement Corp
• Kealawn Technologies Pvt Ltd
• Marvel Infrastructure
• Classic Realty
• Silicon Builders
• Swasti Power Engineering Ltd

First post also mentions that Sandur power has 4 subsidiaries atleast:

• Classic Realty
• Harish Infrastructure
• Capstone Infra
• Silicon Builders

Is your mind in a tizzy now? Has it been blown away by the complications of companies, percentages, ownership, subsidiaries and the wealth discussed above? Here's more official information:

Jagan declared the value of his assets as Rs.365 crore in 2011. Another ~Rs47 crore in the name of his wife. He is the richest MP in the annals of Indian history, with no close competition in sight in the near future! Guess how much his declared earnings were in 2003? ~Rs.9 lakh!! In 2009 - it was Rs.77.40 crores. From a mere 10 lakhs in 2003 to tens of crores in 2009 to hundreds of crores in 2011 - this is one musical journey for Jagan Mohan Reddy and YSR's family!

Almost every company mentioned above received some largesse or the other from the government (both the centre and the state were ruled by the Congress during this time). Each of these investors have recieved some largesse (in terms of land, investments, loans, rules etc). Now, are you wondering how come no media highlighted this? Take a look at the snapshot below.

The above snapshot is a small collection of headlines from the popular telugu daily, eenadu. Eenadu, along with another newspaper Andhra Jyothy, has revealed many such corruption sagas by the YS family and the other members of the Congress government. Slowly, a momentum was built saying both these newspapers were partisan; never exposed corruption in TDP regime etc

When TDP and other opposition parties discussed the share holding details in animated debates in the Assembly - guess what YSR and his stooges replied? They asked Chandrababu Naidu why he was jealous if other companies were making money! The ruling party rubbished pretty much every allegation. YSR even appointed some judicial commissions with retired Judges heading them - ofcourse we know the result (almost none of them submitted any report)! Not satisfied with that, they went on to open a newspaper and a TV channel to counter the "opposition" propaganda!

Sakshi newspaper and TV had two goals in mind - glorify YSR and demonise Chandrababu/Eenadu. If eenadu stories had details about corruption by YS and family, Sakshi would immediately resort to stories of "corruption" by eenadu etc. As if corruption by one group justified corruption by the other! And now suddenly the debate in the state turned to the "media war". The debate was never about corruption anymore - just about how cunning these media people are blah blah.

Even by now, if you are not convinced that public money and power were not misused, here's a minor fact revealed by CAG. Governments are not supposed to place ads in new newspapers, unless they publish continously for six months. Guess for which newspaper this rule was broken?? Full page ads in Sakshi newspaper right from day one! That's your money down the drain there! Sakshi paper was established for government propaganda and on top of that - full page ads!

The above mentioned details are just of THE empire. We have not even discussed the mammoth corruption in various government schemes and programs, that went on unhindered. Jalayagnam, the pet project of YSR involves construction of "30 major and 18 medium irrigation projects at a cost of Rs. 46,000 crores to provides irrigation to an extent of 73 lakh acres ". From the official website (which incidentally still has a picture of YSR and not the current CM!), "Eight of these projects were to be completed before the kharif season of 2006". Till now, only 12 projects have been completed. Project costs were escalated, tender process was rigged - what not! Even Sonia Gandhi was forced to order an internal probe into this! It was even labelled as "Dhanayagnam" by the opposition! No news about that. Scams unearthed ranged from industries (which involved the current PCC Chief)to education department, and yet not a squeal from the "national" media.

I am sure you people must have heard about "Reddy Brothers" from Karnataka. I am sure you would have assumed by now, given the awesome coverage that they are the epitome of corruption in this country. You must have also heard that through their Obulapuram mining company, the Reddy brothers have manufactured an unprecedent loot of natural resources of this country. Quiz Question - in which state in Obulapuram located? Andhra Pradesh!

This same Obulapuram Mining company also owns "Brahmani Steels" which - hold your breath - reportedly made profits even before it started manufacturing any steel! 10,000 acres of land was alloted to it in Kadapa (Andhra Pradesh) after a cabinet decision by the Congress government in AP in 2007. We were also told that the plant will start manufacturing within 18 months (without any bank loan!) and will beat Vizag Steel Plant in no time (according to latest TOI report, the plant is nowhere close to manufacturing!). Amidst lot of criticism, a successful foundation laying ceremony was also held. I very vividly remember, YSR playing a Quiz master here and asking the Reddy brothers all the questions that the opposition was asking, and the Reddy brothers "refuted" them point by point. And therefore, amidst public, it was decided that this steel project is the awesomest idea ever.

The USP is always the same. Allot shares for yourself at the cheapest price possible. Lure investors to buy shares at a more higher price. Give these investors largesse in terms of land, concessions etc etc. And get away with all the loot.

What has been mentioned in this blog so far is not comprehensive - only because the loot is so large, it is impossible to cover everything in one go! A mining lease was issued to YSR's son-in-law Brother Anil Kumar, which was later cancelled by the centre, very conveniently in 2010. I am sure if we start digging into Brother Anil Kumar's business details.

Please remember, all this loot happened when Jagan was a member of Congress party and his father YSR was heading the Congress government in Andhra Pradesh. Please also remember that YSR was one of the favorite Chief Ministers of the high command led by Sonia Gandhi.

The reason I am mentioning the Congress party so many times is because there has been a concentrated campaign to try to convince people that this loot by the Congress party led by the father-son duo had nothing to do with the Congress party itself! And now, after Jagan Mohan Reddy has resigned from Congress, many leaders from Congress are openly accusing him of misusing power. Many are openly calling him as very corrupt. And when pointed out that all this corruption took place under the guidance of YSR, they went on to say, Jagan misused his father's powers!!

The Andhra Pradesh High Court directed the CBI to investigate these cases. Minor fact that media won't tell you - this case was filed by a Congress minister, Sankar Rao! (a second case was filed by TDP leader, Yerran Naidu). So now, the corruption accusations are no more a opposition and media conspiracy. Have you ever seen a near unanimity amongst all major political parties on such a contentious issue? Leaders of the same Congress party who enjoyed the spoils of power under YSR are saying there was massive corruption; PRP, the party whose main plank was to take on this corruption merged with the Congress because YS family is not in power anymore; TDP, Left, and BJP (the state unit) have been crying hoarse from a long time too!

The regional media, has been shouting from the rooftop of the loot being done in the name of business acumen. From about 6-7 years, they have been very vociferous of the corruption and robbery the YS family has been resorting. This "national" media was no where to be seen or heard. There was one obscure "Devil's advocate" interview by Karan Thapar in which YSR had only one answer - Go the court if you think it is wrong! Other than that, no "exclusives". No stories of the phenomenal growth of THE empire. Atleast, if they thought this was a media war - no story about that either!

The closest any newspaper came was this article in livemint. Just that article is enough to confuse us with the machinations used.

Anyways, Jagan owns two palaces. One in Hyderabad. It is a 74 room palace! The second is in Bangalore. Take a look below

Bangalore palace:

Hyderabad palace:

And what did B.S.Yedyyurappa do? Alloted some government land under CM's discretionary quota to his family members. Remember the outrage by the "national" media? I rest my case.

PS: I would welcome any fact based rebuttal. Please resist from labelling this article as Anti-jagan, anti-congress blah blah. We have crossed that line long back!

Part-2 of this series is here.
Part-3 detailing how YSR won despite this loot is here.