The recent crisis in the BJP government in Karnataka was focused on whether B S Yeddyurappa would remain as the chief minister or would the rebels get their way, or whether the BJP central leadership would succeed in affecting a compromise.
But the real significance of this crisis lies elsewhere. The events in Karnataka showed up the brazen nexus between politics and a big business that the BJP had forged in that state. This was taken to a new dimension after the BJP incorporated the Bellary mining syndicate run by the Reddy brothers into the government. After riding on the shoulders of this most rapacious business combine and making them part of the government, the BJP is now faced with this lobby's ambitions extended to dictating policies in the government and blackmailing the party.
The BJP has only itself to blame for its predicament. After the last assembly elections in 2008, the BJP emerged as the single largest party but short of a majority. The BJP's election success was partly due to the intervention of the Bellary mine owners who ensured victory for the BJP candidates in four districts. It were the Reddy brothers who ensured the support of five independents for the government. They were handsomely rewarded.
Three from the Bellary syndicate became ministers — two of the Reddy brothers and one close associate. The revenue, tourism and health portfolios were given to them. The BJP did not stop at that. In order to consolidate its precarious majority in the assembly with the funds provided by the Reddy brothers, it undertook an operation to organise defections of Congress and JD(S) MLAs who submitted their resignations from the assembly. This ensured that the BJP had a clear majority in the assembly.
The rise of the mining business of the Reddy brothers is a saga of crony capitalism and the close nexus established with politicians and pliant bureaucrats. By bending laws, getting new regulations and enactments to favour them and by blatant violation of forest and environmental rules, the Reddy brothers became a major beneficiary of the Rs 4,000-crore annual profits being reaped through the export of iron ore, taking advantage of the boom in the international iron ore prices due to the huge demand for it in China (the price of a tonne of iron ore shot up from Rs 200 to Rs 2,000).
This plunder, connived with the state, saw the government getting a royalty of only Rs 27 per tonne when the price it was being sold at was Rs 2,000. In 2005-06 alone, 35 mine owners got Rs 3,600 crore in profit. It is this ill-gotten wealth and assets which the Reddy brothers deployed effectively for the BJP. The Reddy brothers have not been shy of flaunting their wealth and influence. One of them is reported to have said during a heated exchange in the assembly last year: "People say we are worth Rs 100 crore. I want to correct it…. we are worth Rs 1,000 crore."
The BJP in Karnataka is now in danger of being devoured by the rapacious business combine who they nurtured and inducted into the government. Already, within the one-and-a-half-year span of the BJP government, the Reddy brothers have extracted big concessions and got criminal cases against them withdrawn. They are now utilising the division within the BJP leadership in the state to extract a bigger price. One of the terms for the compromise was that posting of officials in Bellary district would be done in consultation with the mine barons.
The symptoms of the rot are manifested in all sectors of public life. In the corporate media, making money during elections by providing packages to candidates and parties for news coverage is widespread. Increasingly, in legislatures and the parliament, representatives are being elected from big businesses, liaison men and contractors. Business tycoons sit in parliamentary committees that decide on policies. There are ministers in the Union Cabinet and state cabinets who are actual businessmen by profession. All democratic forces and concerned citizens should act to halt this process.
(Excerpts from CPI M Secretary Prakash Karat’s editorial in party organ People’s Democracy, dated November 15, 2009)
