The law has finally caught up with G. Janardhan Reddy, the Bellary-based mining tycoon, whose wealth and political clout created what the Karnataka Lokayukta in a recent report famously referred to as “the Republic of Bellary.” The arrest of Mr. Reddy, a former Tourism Minister and a director of the Obalapuram Mining Company (OMC), along with the company's Managing Director, by a Central Bureau of Investigation team is a welcome first step in the process of bringing to justice those involved in the unprecedented plunder of scarce natural resources. The arrests arise from a case registered by the K. Rosaiah government in Andhra Pradesh on December 7, 2009 for OMC's alleged illegal mining, corruption, and destruction of forest wealth. The cases were filed under the relevant sections of the Indian Penal Code, the Prevention of Corruption Act, the Indian Forest Act, and the Mines and Minerals (Development and Regulation) Act. It is significant that action against Mr. Reddy and his associates was initiated in Andhra Pradesh, where only a relatively small part of Mr. Reddy's business operations lie. According to the Lokayukta report and those of the Central Empowered Committee appointed by the Supreme Court, the bulk of the OMC's illegal operations are in Karnataka.
The rise of this son of a small-town police constable owed considerably to political patronage in both States. His proximity to former Andhra Pradesh Congress Chief Minister Y.S. Rajasekhara Reddy helped in getting lucrative mining leases in Anantapur district, while in Karnataka his expanding business empire fed the fortunes of the Bharatiya Janata Party. The BJP government, of which he was part, is yet to initiate legal action despite the damning evidence in the Lokayukta report of the OMC's illegal operations. The long list of violations includes under-invoicing of iron ore exports to the tune of approximately Rs.215 crore that, according to the report, “might have been parked in some bank of another country.” If an inner-party rebellion led by his associate B. Sriramulu has been doused, his arrest will dent the party's credibility at a time its central leadership is attempting to ride the anti-corruption wave across the country. To its discredit, the State party leadership criticised the arrest, and the government did little to rein in Mr. Reddy's supporters who went on the rampage in Bellary city. N. Santosh Hegde, retired Supreme Court judge who served as Karnataka's Lokayukta until recently, has suggested that the BJP government must follow the example of Andhra Pradesh and seek a CBI investigation into illegal mining in Karnataka. It's the BJP's turn to feel the heat.
