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Rajdeep Sardesai
Friday , July 23, 2010 at 00 : 00

The Reddy Republic


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When Karnataka's infamous Reddy brothers make their Diwali gift list this year, they might consider sending a large present to Congress president Sonia Gandhi. Had Mrs Gandhi not chosen the traditional Congress bastion of Bellary as a safe constituency alternative to Amethi in 1999, the Reddy brothers may well have disappeared into the wilds of central Karnataka. That election changed their career graph, transforming them from small-time chit fund operators to unquestioned mining kings to de facto rulers of the state.

Sonia's entry into the Bellary poll fray drew BJP's mascot Sushma Swaraj into the battle. The Reddys became Mrs Swaraj's poll managers and won her trust. The rest is now part of Karnataka political folklore, their rise exemplifying the ultimate triumph of contemporary political robber barons.

If Sushma Swaraj was their original political benefactor, then the 2008 Beijing Olympics was their passport to the big money league. As the Reddys expanded their mining business, Beijing increased its appetite for iron ore. Incredible profit margins from overloaded trucks -- estimated to be around Rs 20 crore per day-began to multiply as the Reddys acquired more mining leases. Mining, in a sense, was ideally suited for the Reddys vaulting ambitions. Poorly regulated, still run through discretionary licenses and government largesse, mining leases could be obtained through a mix of local-level muscle and manipulation.

The Reddys were clearly adept at both. In the process, they have overturned the traditional rules of Indian politics. Conventional wisdom suggests that caste is the key determinant of political power.

The rise of the Mandal forces has accentuated the belief that social engineering is critical to building a political base. Then, whether it be the Yadavs of the Hindi heartland, or the Dravidian parties in the south, caste loyalties are seen to be the defining badge of political mobility. In Karnataka too, the Lingayats and the Vokkaligas have emerged as the main competitors for backward class dominance in the state's caste cauldron. The Reddys have changed the rules of the game.

The Reddy brothers - Karunakara, Janardhana, and Somasekhara - are originally Andhra Reddys, with strong ties to their home state. In Karnataka, the Andhra Reddys number only a few lakhs, making them a marginal vote bank. But what they didn't have in votes, the Reddys have more than made up with 'notes'. By building a vast treasure chest through their extensive mining operations, they have created a situation where money power is a substitute to caste power.

In a sense, they have almost rendered caste irrelevant, creating the basis for a new form of post-Mandal politics. Today, more than 60 MLAs in the 117 member BJP state legislature party owe allegiance to the Reddy brothers. It is believed that in the 2008 elections, the Reddys 'sponsored' at least 75 candidates. When the BJP needed independent MLAs, the Reddys 'organised' the support. Last year, when the Reddys virtually challenged chief minister's BS Yeddyurappa's authority to appoint his Cabinet, they succeeded in reducing him to tears on national TV.

This year, they have already forced a resignation of the Lok Ayukta (since taken back) and openly confronted the state governor. Whether it is the transfer and appointments of officials or granting government contracts, the Reddys run Karnataka as extra-constitutional figures heading an independent 'Reddy republic'.

In the process, they have also shown just how far the BJP has moved from its claim of being a 'party with a difference'. That the party's central leadership appears helpless to rein in the Reddys only confirms the weakness of a political order where desperation to retain power leads to compromising on basic principles.

Karnataka, after all, was to have been the saffron forces 'gateway to the south'. The party simply could not afford to let it go. If that meant winking at instances of obvious corruption and a flourishing illegal mining business, then it was seen as a small price to pay. But why blame the BJP alone?

The Reddys business empire has been remarkably politically neutral. The Congress's regional satrap, the late YS Rajshekhar Reddy gave his Karnataka bretheren mining leases in Andhra Pradesh. To stay ahead of the system, the Reddys were freely allowed to change the boundaries of their cross-border mines, even acquiring vast tracts of land well beyond the original lease.

Without YSR's benevolent gaze, the Reddys could not have spread their businesses so widely across two states. In Andhra, YSR patronized them, in Karnataka the BJP legitimised them.

In a way, their phenomenal growth story - their father was a local head constable - is inspiring similar stories across different states. If in Karnataka it is mining that is seen to provide the vast riches that are needed to acquire political control, in neighbouring Maharashtra, real estate provides a similar opportunity.

For example, in the last assembly elections in Maharashtra, more than half the candidates of the major parties in Mumbai and Pune listed construction as their main source of their income.

If the mining mafia rules Karnataka, the builder lobby now runs urban Maharashtra. The modus operandi is similar. Set up a potentially cash-rich business and get into a benami partnership with an influential politician. Use the political patronage to acquire large projects.

Once a sizeable corpus is created, distribute the wealth in a manner that you are able to subvert the legal system by bribing and manipulation. A stage is reached when the political class becomes dependent on you. At that moment, you have the choice of becoming a neta and using money power to literally 'buy' your way to the top. That's exactly what the Reddys did in Karnataka.

That's what many other aspiring political entrepreneurs are attempting in other states.

Post-script: The Reddys latest project is to set up a Kannada news channel. Like other far-sighted netas, they too have realized that the best way to control the media is to take it over.

(The writer is editor in chief IBN18 network. Mail rajdeep.sardesai@network18online.com)


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More about Rajdeep Sardesai

Rajdeep Sardesai was the Editor-in-Chief, IBN18 Network, that includes CNN-IBN, IBN 7 and IBN Lokmat. He has 22 years of journalistic experience during which he has covered some of the biggest stories in India and the world. Prior to setting up the IBN network, he was the Managing Editor of both NDTV 24X7 and NDTV India and was responsible for overseeing the news policy for both the channels. He has also worked with The Times of India for six years and was the city editor of its Mumbai edition at the age of 26. During the last 22 years, he has covered major national and international stories, specialising in national politics. He has won numerous other awards for journalistic excellence, including the prestigious Padma Shri for journalism in 2008, the International Broadcasters Award for coverage of the 2002 Gujarat riots and the Ramnath Goenka Excellence in Journalism Award for 2007. He has won the Asian Television Award for best talk show for the Big Fight on two occasions and his current flagship show on CNN-IBN, India at 9, has been awarded the best news show at the Asian awards for the last two years. He has been News Anchor of the year at the Indian Television Academy for seven of the last eight years and won more than 50 awards in this period. He has also been the President of the Editors Guild of India, the only television journalist to hold the post and was chosen a Global leader for tomorrow by the world economic forum in 2000. An alumni of St Xavier's College, Mumbai, he has done his Masters and LLB from Oxford University and has also played first class cricket for the Oxford University team. He has contributed to several books and writes a fortnightly column that appears in seven newspapers.
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