Unshaken by CBI investigations, Jagan Reddy gets closer to his goal of becoming Andhra Pradesh Chief Minister

With the Centre sending the CBI after Jaganmohan Reddy, and the Enforcement Directorate expected to follow, the late Chief Minister YS Rajasekhara Reddy’s son has displayed his survival skills by drawing first blood and splitting the beleaguered Congress in Andhra Pradesh.

Though there is no threat to the 11-month-old Kiran Kumar Reddy-led state government, the opposition, led by the Telugu Desam Party (TDP), is waiting to move a no-confidence motion. If that happens, the Congress will have to dig deep into its bag of tricks to avoid becoming a minority government.

The Congress MLAs supporting Jagan are livid with the party leadership for allowing the CBI to include YSR’s name in the CBI’s FIR against his son, an MP from Kadapa. In protest, 27 of them have decided to go on a bus yatra. In the meantime, the state Congress leadership is also entangled in the prolonged Telangana agitation, over which 100 MLAs had threatened to resign.

Till last weekend, senior Congress leaders were loudly denouncing Jagan and quoting from the CBI FIR about his ballooning assets. But now, with YSR’s son hitting back and poaching on party MLAs, they have gone into a huddle.

A peeved Centre attacked Jagan by unleashing the Income Tax Department upon him, which unearthed a trail of dummy companies that have invested in his businesses. The Kadapa MP is one of the richest in India and had declared assets worth Rs 365 crore in April. He had also filed income tax returns of Rs 227 crore in July. The CBI took over where the IT Department left and sought to establish that the wealth was gained after YSR became Chief Minister.

The CBI’s contention is that the so-called investors put money in Jagan’s companies only after receiving favours from the then government. They also allege that Jagan authored the entire money laundering conspiracy from his headquarters in Bangalore, away from the public glare in Andhra Pradesh.

The CBI focused on Jagan after state minister P Shankar Rao filed a petition in the Andhra Pradesh High Court last year alleging that he had amassed huge wealth by misusing his father’s office. In his petition, Rao had alleged that Jagan Reddy’s income tax returns swelled from Rs 11 lakh in 2004 to the hundreds of crore now—and his wealth increased to Rs 43, 000 crore in 2009—as he profited while his father was Chief Minister. The CBI’s FIR lists 33 companies that had invested in Jagati Publications, the media house that operates Sakshi TV and a multiple edition Telugu daily by the same name.

After YSR’s death, Andhra Pradesh has been under a twin siege: the demand for a separate Telangana state and Jagan Reddy saying that he is the rightful Chief Minister of Andhra Pradesh, being successor to his father. Jagan Reddy has made it clear that he will not hesitate to split the Congress to reach his goal. PCC President Botsa Satyanarayana is already alleging that Jagan is using money to lure away MLAs and has warned those trying to leave the Congress that they, too, would get tainted like Jagan: “If you think you can resign and win, the people of your constituency will not forgive you for aligning with the corrupt.”

Both sides have already started trading charges of using money to buy support. Ambatti Rambabu, a Jagan loyalist, is accusing the Congress of sanctioning Rs 300 crore worth of projects to actor Chiranjeevi to hasten his party, the PRP’s merger with the Congress. Ghulam Nabi Azad, general secretary and Andhra Pradesh-affairs in-charge of the Congress, has been talking to some of the legislators who have jumped camp. The party leadership is of the opinion that these MLAs are only using the resignation ploy to mount pressure on the party and extract their own demands.

It is clear that the Congress is directionless. The party position in the Assembly previously stood at: Congress—156, TDP—88, PRP—18, TRS—11, MIM—7, CPI—4, BJP—2, CPM—1, YSR Cong—1 and independents—3. After the PRP’s merger, the Congress strength rose to 172 (two PRP MLAs have aligned themselves with Jagan). But, after the resignation of 27 Congressmen, the party’s tally now stands at 147 and the combined opposition’s at 106. As 156 is the halfway mark, the Congress still expects to sail through with the help of MIM and three independents who are associate members.