3 years


Red Earth and Multicoloured Patronage

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The miners of Bellary are survivors. And the Reddy brothers wily enough to retain their clout as power shifts from the BJP to the Congress in Karnataka

The recent assembly polls in Karnataka have allowed Bellary’s powerful mining lobby, which made headlines across the country for rampant illegal mining and for being shut down by the Supreme Court-monitored Central Empowerment Committee, to regroup by changing its political colours. Congress miners have stepped into the places vacated by those affiliated with the BJP, even as the infamous Reddy brothers have retained their clout and their associates kept up a winning streak. In fact, many tainted miners indicted by the Karnataka Lokayukta contested the Assembly polls, and some even won, simply by changing their political affiliation. Siddaramaiah, the new Chief Minister who promised to bring those miners indicted by the Lokayukta report to book, has been left with egg on his face, as also his party, which gave tickets mainly to such candidates.

Now, after its victory, the Congress defends itself by saying that many agencies that conducted surveys on its behalf had reported these mine owners to be popular and preferred by local leaders. “We knew they had a better chance of winning than traditional Congressmen,” admits a senior leader. “The only fear is that these mine MLAs may misuse the government to meet their own ends.’’

The Congress is aware that, despite the BJP’s defeat, the Reddy brothers’ electoral clout has not diminished in the district. While Gali Janardhan Reddy remains in jail, his brother Karunakar Reddy stood on a BJP ticket from Harapannahalli, away from Bellary city, and lost. Their other brother Somasekhar opted out of the contest altogether. Somasekhar was earlier arrested by the CBI for trying to bribe a judge to grant bail to his brother, and spent time in Chenchalaguda jail in Hyderabad along with Suresh Babu, another MLA, who incidentally won on a BSR Congress ticket in the recent polls. The BSR Congress, floated by the Reddys’ man Friday B Sriramulu, has won four seats. Three of them are miners.

While the BJP was in power, the Reddy brothers had completely taken control of Karnataka’s mining industry by both legal and illegal means. They coerced mining companies into ‘raising contracts’—a euphemism for extortion whereby companies had to pay to have the ore they’d mined lifted out of Bellary district—and their own illegal mining operations in the forests of Andhra Pradesh, too, spilled over into Karnataka. Janardhan Reddy was jailed after the CBI started investigating beneficiaries of the late YS Rajasekhara Reddy’s Andhra government, especially his son YS Jaganmohan Reddy.

It is clear that the Congress wanted the maximum possible number of seats in the mine-rich district as insurance for the future. Their strategy was to ensure that players such as the Reddy brothers would never rear their heads again. “Clearly, it’s a high stakes game, which the Congress has won this time round,’’ says the senior Congress leader. The Bellary mining case has attracted interest nationwide as a kind of test case for mining policy. Only the Supreme Court’s intervention saved the district from being completely annihilated by open cast mining. Studies have found that mining companies active in the district wiped out 50 years’ worth of ore deposits in less than five years.

Chandra Bhushan, deputy director-general at the Centre for Science and Environment, says the lessons from this district will serve as valuable inputs for future policy: ‘The Bellary case—and perhaps now the Goa case—is setting a precedent for mining regulations in the country. It will define how the offenders are judged, how serious their crime is and how they should be penalised. In other words, it is developing a mining penal code for the country. It is setting the framework for future environmental management, including limits on how much mineral extraction is ‘sustainable’. In addition, the judgments set the framework for how local people will ‘benefit’ from mining. Therefore, in many ways these decisions are overarching and are definitely needed, as the current regulatory system has been decimated. The question that needs to be discussed is whether the judgments go far enough in [determining a] sustainable framework for mining in the country. Or, indeed, if they are in the right direction.’

Santosh Martin, an environment activist and resident of Bellary who has helped highlight illegal mining in the district, says the general fear is that the situation will slip back to the Reddy days. “Of course, it will not be so rampant, but illegal mining will continue in some form or the other now that so many of the indicted miners have won. The Supreme Court has asked C category mines [those involved in illegal mining] to be auctioned or sold off, but there is no such mechanism in place. Rumours doing the rounds indicate that the Reddy brothers, who have floated many offshore companies, may pick up stakes in the companies up for auction.’’

Martin also feels that the work of the Enforcement Directorate, which is investigating the Reddys for suspected money laundering, is only half complete as it is yet to file a chargesheet under the Prevention of Money Laundering Act, even after attaching Reddy properties to the tune of Rs 800 crore.

The scourge clearly has not been dealt with, as six of the nine Assembly consti- tuencies in Bellary district have elected MLAs linked to illegal mining. Of them, two (Anil Lad and E Tukaram) are from the Congress, two (B Sriramulu and TH Suresh Babu) from the newly formed BSR Congress, one (Anand Singh) from the BJP and one (B Nagendra) independent.

They have all been named in the Lokayukta report submitted by Karnataka Lokayukta Justice Santosh Hegde to the Governor in 2011. Even those who lost on Congress tickets, like Vannurappa and Abdul Wahab, are tainted mining barons who have been named in the report. These barons left no stone unturned in their quest for victory. Bollywood actor Suniel Shetty, accompanied by a bevy of beauties, campaigned on Wahab’s behalf.

Despite the BJP’s claim that the Reddy brothers and Sriramulu had been dumped by the party, its candidates lost in most constituencies, perhaps an indication that people were upset with the party’s silence when the brothers were tightening their grip on the district.

But the continuing clout of BSR Congress and Reddy supporters has surprised many. The victory of sitting MLA B Nagendra from Kudligi in the district is a good example of how miners and their associates have managed to keep themselves afloat merely by dusting off their political affiliations. Nagendra, who won on a BJP ticket in 2008, contested as an independent this time and won by a whopping margin. Widely believed to be in the Reddy brothers’ inner circle, his company Eagle Traders and Logistics has been named in the Lokayukta report for transporting illegal iron ore from Bellary to various ports in Karnataka and Andhra Pradesh. The report has documented estimates that Eagle Traders shipped illegal ore worth Rs 649 crore between 2007 and 2010.

Anil Lad, another mining tycoon, declared assets worth Rs 188 crore in his election affidavit. His firms VSL Mining Company and Divya Jyothi Steels have both been named in the Lokayukta report for transgressing norms. Lad was a BJP MLA from Bellary from 2004 till he joined the Congress 2007 and was rewarded with a Rajya Sabha seat. He has threatened to resign from both posts because he has not been made a minister in the Siddaramaiah government. Technically, he should have to give up either his RS membership or Assembly victory.

A national level shooter with a penchant for the good life, especially imported wheels, Lad is a potential trouble maker for the Congress. He is particularly peeved that his younger cousin Santosh Lad, another mining lord who won from a neighbouring district, has been made minister. The party can only hope that the CBI arrests him as soon as possible—Lad is one of the 28 accused in the Belikeri port case of the storage of illegally mined ore for export currently being investigated by the CBI. E Tukaram, the Congress MLA who won from Sandur in Bellary district, is yet another iron ore mining baron accused in the Lokayukta report. Tukaram is linked to one of the 49 category C iron ore mines that violated norms in the Bellary region, according to both the Lokayukta report and the Central Empowerment Committee. Despite the charges against him, including one of illegal possession of prime government land in the town, he won by a handsome margin.

Another category C miner, also re-elected, is BS Anand Singh of the BJP. And though other BJP winning candidates are not involved in mining, there are allegations that they have been backed by mine owners.

It is still to be seen how the Bellary story unfolds as the Congress takes charge of the district from which it was once banished completely. With the SC-monitored CEC looking to auction C category mines in a ‘transparent’ manner, the party will have its hands full—especially since some of its newly minted legislators will be under scrutiny of the law.