http://www.tehelka.com/story_main50.asp?filename=Ne060811COVERSTORY.asp

LOKAYUKTA REPORT

The baron might go. The robbery goes on

Karnataka was once the poster for India’s growth story. Today, it’s a flag
for everything that can go wrong.*Ashok Malik* sounds the alarm calls from
the state. With *Imran Khan*

*IT IS* now fairly clear that the BJP is going to replace BS Yeddyurappa as
chief minister of Karnataka. The second and final report of Justice N
Santosh Hegde, Karnataka’s Lokayukta, on the extent and consequences of
illegal iron ore mining in the state, have left the ruling party in
Bengaluru with little choice. As a senior BJP leader put it: “Even those who
have been supporting Yeddyurappa in the BJP central leadership have had to
stay quiet this time. It has reached the line of no return.”

In many ways Yeddyurappa is the perfect villain. He is manipulative and runs
a government that has won over — with a series of inducements — Congress
MLAs by getting them to resign and contest by-elections as BJP candidates.
He is cynical in that he has made ministers of three of the state’s most
infamous mining contractors (including the Reddy brothers, Gali Karunakara
and Gali Janardhana). A prominent newspaper columnist recently accused him
of running India’s most corrupt state government.

While that final epithet may be usual editorial exaggeration, the point is
Yeddyurappa — and his family, particularly his sons, BY Vijayendra and BY
Raghavendra, and son-in-law, RN Sohan Kumar — has come to symbolise the
junction at which two of the most pernicious influences on contemporary
Karnataka society meet: its real estate and mining syndicates.

In particular, one example is telling, and telling of a continuum. It forms
part of a set of five petitions — recording 15 individual cases of abuse of
authority — that Bengaluru lawyer Sirajin Basha has filed in a local court.
The case goes back to 2003, when the Bangalore Development Authority (BDA)
acquired over 3,000 acres of land in Greater Bangalore for group housing
projects. The 3,000 acres included a patch of one acre and 12 guntas (40
guntas make an acre) acquired in Rachenahalli village, near Bengaluru’s new
airport. Of this patch, 26 guntas belonged to a man called Panduranga and 26
guntas to a lady called Gowramma.

Later in 2003, SN Krishnaiah Shetty, then an MLA, registered a
power-of-attorney in his favour that was apparently executed by Gowramma and
Panduranga. In March 2006, Shetty used the power-ofattorney to execute and
register two sale deeds, selling the land of the two villagers for a total
of Rs 40 lakh. The buyers were Vijayendra, Raghavendra and Sohan Kumar.
Having sold land that had already been acquired by the government (and for
which compensation had been paid), Shetty then waited till 2008. In
September that year, he applied to the BDA for denotification of the patch.
In a petition on behalf of Gowramma and Panduranga, he insisted they needed
the land for family use.

This wish was granted in a quick 11 days. The denotification order was
passed by the chief minister himself. The story doesn’t end here. The land,
a little over one acre, was then sold to South West Mining Company — part of
the Jindal Group, and with iron ore mining interests in Karnataka — by
Yeddyurappa’s children. A trust run by them received Rs 20 crore for the
transaction. The market value of the land was less than Rs 2 crore.

Coincidentally or otherwise, Yeddyurappa was the chief minister who
denotified the land. At the time, he handled the portfolios for the BDA,
forests and mining. As such, he had conflicts of interests written into
every element of the larger transaction. In a sense, this case mirrors the
sweetheart deals companies run by DMK family members have been accused of,
in return for favourable policy changes by DMK telecom ministers. It leaves
Yeddyurappa and the BJP with very little defence.

II *THE KARNATAKA* corruption saga is an endless soap opera that has dragged
on for months, if not years. It goes back really to the BJP’s Assembly
election victory in 2008. Yet, it is not one that lends itself to pat
assessments. For one, as a visit to the state would testify, Yeddyurappa is
hardly the hate figure there that he is in New Delhi and the national media.

Neither the man nor his methods are easily dismissed. Yeddyurappa has made
the BJP a formidable electoral force in the state, far stronger some argue
than it was when it came to power (*see box*). Even political opponents
acknowledge that he is a clever and hard-working man. As a Janata Dal
(Secular) or JD(S) functionary says, almost in admiration: “He is an astute
politician. He has delivered on social welfare schemes, particularly those
aimed at the girl child and at farmers in BJP strongholds in central and
north Karnataka.”

As for his way of doing things, “crass and vulgar corruption” has become
something of a Karnataka trademark says Sandeep Shastri, Bengaluru-based
academic and convenor of the Lokniti Network. One of Yeddyurappa’s potential
successors in the BJP is very critical of him. “What’s been revealed is the
CM’s ‘pickpocket corruption’,” he says, in the stylised rhetoric that seems
to come to politicians south of the Vindhyas. “What remains unrevealed is
his ‘robbery corruption’.”

All very well — but surely the Reddy brothers should also be removed if
Yeddyurappa is. Suddenly the would-be successor is not too sure. “They are
very essential to the party,” he says. “They have given the BJP a hold in
Bellary and Raichur. We were nothing there even 10 years ago. Besides, you
can call them early investors in the party.”

“Early investors in the party”? It is an astonishing description of the
brothers, political fixers and small-time businessmen, who rode the
commodities boom and the pre-2008 OIympics steel demand surge in China to
ravage the earth of Bellary for iron ore.

The Bellary brothers come with their political clout. Their business and
strongarm network in the district gives them enormous leverage at election
time. In 2009, they are believed to have funded the BJP in Karnataka and
their friend, the late YS Rajashekhara Reddy, then the Congress’ Andhra
Pradesh chief minister, in the neighbouring state.

At one stage, the Reddy brothers led a revolt of some 40 MLAs — a third of
the BJP’s legislative strength in the 224-member state Assembly. “Their
actual influence,” says a leading businessmen in Bengaluru, “should be about
17-20 MLAs. These are people they have financed and got elected. But of
course, money could get them to buy more.”

The Reddy brothers’ business partner is B Sriramulu, Karnataka’s health
minister and a Scheduled Tribe (ST) strongman in Bellary. Sriramulu’s
community appeal and the Reddys’ mobilisation capacities have helped convert
Bellary — which even at the turn of the millennium was one of the Congress’
safest seats in the country — into a BJP bastion. It has also savaged the
ecology of the district, and made them laws unto themselves as mining
barons.

*III NEVERTHELESS,* *THE* Reddys are not alone. Bellary district, with three
iron-rich talukas of Bellary, Hospet and Sandur, is home to over 1,000
mining leases. The adjoining districts of Chitradurga, Tumkur and Raichur
have another 30-odd leases. Much of the mining is in the Bellary reserved
forest, among the greenest expanses in peninsular India and declared a
protected area by the British in the 1890s.

Iron ore began to be mined here as far back as 1873, but has reached
frenetic proportions in the past 10 years. As an environmental activist puts
it: “This is a problem that extends across parties. Even SM Krishna’s
Congress government expanded the area of legal mining by under- reporting
the forest and tree cover.”
The consequence is Wild West lawlessness. Mining companies keep breaching
state borders (Andhra Pradesh is on the other side of the forest and has
limited iron ore reserves). Illegal mining, meaning encroaching upon a
another miner’s lease area and then threatening him into surrender, as well
as mining in no-go forest areas, is rampant. The implications are truly
frightening. SR Hiremath, engineer activist and executive director of the
Samaj Parivartana Samudaya, an NGO that took the issue of ecological damage
caused by illegal mining to the Supreme Court, points to a National
Environmental Engineering Research Institute (NEERI) report: “It estimated
that about 10 million tonnes of iron ore extraction per year was
ecologically sustainable.”
-- 
Peace Is Doable

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