Exclusive: The rise of Bellary Reddys

The illegal mining issue has rocked the Karnataka assembly and the “party with a difference” has failed to take action against the mining mafia in the state.

The Karnataka Government last Friday gave suo motu powers to the Lok Ayukta but kept elected representatives (CM, Ministers, MLAs) outside its purview. The BJP government is not taking decisive action against the mining lobby as some of the alleged accused are a part of its government. As promised, Canary Trap brings you exclusive details of the rise of Bellary Reddy’s (G Karunakara Reddy, G Janardhana Reddy, G Somashekara Reddy).

G Janardhana Reddy (GJR) took over the GRR Mines (G Raghava Reddy Mines) between 2000 and 2001 on sub-lease. He sub-leased these mines to one Anil Lad (then in BJP, now a Congress Rajya Sabha MP). Lad’s earnings, through foreign clients, increased and so GJR conspired with his associates and secured back the possession of these mines. The mining boom that began by the end of 2003 (when the price of iron ore rose from Rs 200 per metric tonne to Rs 2700 per metric tonne) made the Bellary Reddy’s the mining czars. The brothers earned huge money by exporting iron ore to China.

According to sources, the Obulapuram Mining Company Private Ltd (OMC) still stands to be under lease basis from G Raghava Reddy of Obulapuram village of Andhra Pradesh. While the OMC mines are located in the Ananthpur district of Andhra, its office is in Bellary. The daily turnover of these OMC mines is about Rs 5 to 6 crores daily, sources added.

Modest start

Sources say GJR and his eldest brother G Karunakara Reddy are learnt to have discontinued their studies sometime in early 1980s. While Karunakara entered into contract work like cable network, GJR joined a Kolkata-based financial firm. He bought his first vehicle (TVS-50) in 1983, a TVS Suzuki Bike in 1985, and an Ambassador car in 1987.

The fortunes of Reddy brothers changed after the 1999 Lok Sabha polls. Although the BJP’s Sushma Swaraj (their ‘thayi’) lost the Bellary seat to Congress President Sonia Gandhi, the brothers emerged as the latter’s trusted aides.

By the end of 1999 the BJP gave them the complete charge of party affairs in Bellary by making all of them district unit president by turn. In 2001, G Somashekara Reddy contested polls for Bellary City Municipal Council and got elected. In 2003, the Bellary Reddy’s snatched the sub-lease of mines from Anil Lad.

Congress link

The brothers have also invested about Rs 20000 crores into an integrated steel plant (Brahimini Industries Ltd) at Pulivendala in Kadapa district of Andhra Pradesh.

Sources add that GJR tried to enter the airways business but has not been granted permission by the Indian government due to his criminal background and that of his brother G Karunakara Reddy and close associate B Sriramulu.

In what could also weaken the Congress party’s campaign against illegal mining, sources say that late Andhra CM YSR Reddy’s son Jaganmohan Reddy receives huge amounts of money every month from GJR as a result of their partnership.

The Bellary Reddys also own a private cable TV network called Bellary City Cable and City Plus, which covers Bellary, Koppal, and Gadag. They also own a Kannada newspaper named Eee Namma Kannada Naadu.

Their mansion in Bellary is surrounded by security guards and gunmen. According to sources, Reddys are not happy as their mansion is not clearly visible from the main road. They feel that the houses around it are shielding the view and hence they are learnt to be threatening the residents around to shift to new houses, which they have offered to build for them elsewhere.

The brothers also have business interests in real estate.

Although the mining areas of Reddys is in Andhra Pradesh, they have been accused of transporting iron ore by violating state border in Bellary Reserved Forest area during the last two years. (2008-2009, 2009-2010).

The Karnataka Lok Ayukta Santosh Hegde has termed the illegal mining of iron ore in the state as the biggest scam the nation has witnessed.

“The value of the Bofors was only Rs. 69 crore. There was the coffin scam of Kargil, but I’ve never heard of one that has crossed the iron ore scam in terms of magnitude,” he told a news portal.

Now the onus lies on the BJP to prove that it can provide clean governance by dropping the Bellary Reddys from the cabinet and initiating an inquiry into their murky business.