Cong launches a new system – to pay commissions on loans, alleges BJPLP leader

Hyderabad: BJP Legislative Party Leader in the State Assembly, Aleti Maheshwar Reddy, has criticised State IT and Industries Minister D Sridhar Babu for misleading the public with confusing jargon regarding the mortgaging of lands belonging to the University of Hyderabad (UoH).

Addressing the media on Sunday, he stated that the IT Minister is using technical jargon to deflect criticism and allegations from the opposition, student unions, and society at large. “It is highly irresponsible for the State government to claim that the Andhra Pradesh Industrial Infrastructure Corporation (TGIIC) raised the loan instead of the government,” he pointed out.

Reddy labelled the Congress government in the state as a “Commission Sarkar”, alleging that it has introduced a system for paying commissions related to loan acquisition, noting that Rs 170 crore was paid as commissions for raising a loan of Rs 10,000 crore.

He further remarked that the IT and Industries Minister claimed that the state government had engaged a SEBI-registered Trust Investment Advisors Private Limited as a merchant banker. The Minister questioned what was wrong with paying a professional fee of Rs 170 crore to the merchant banker as per the rules, emphasising that this indicates a new system for paying commissions to those who assist in raising loans in exchange for kickbacks.

Reddy said that accusations of Rs 120 crore in kickbacks surfaced concerning the Rs 10,000 crore loan. He criticised Minister Sridhar Babu, questioning why no action has been taken and why the State government appears to be protecting the BRS regime from scrutiny regarding the misuse of public funds.

The BJP MLA recalled that in September 2021, Revanth Reddy, as PCC chief, had requested the CBI Director to investigate the auction of government lands in Kokapeta and Khanapeta in Rangareddy district. “Isn’t it hypocritical for Congress, which opposed the sale of government lands while in opposition, to engage in the same actions now that it is in power?” he asked.

Reddy questioned whether the Congress government has decided to sell HCU lands to settle TGIIC debts and for commissions. He noted that the Congress government only used half of the funds allocated for farmer security; the other half was utilised to pay contractor bills. He demanded that the State government halt the sale of 400 acres of Kancha Gachibowli lands, register them in the name of UoH, protect the trees and biodiversity, and develop an eco-park by adding an additional 400 acres to the existing land. Aleti Maheshwar Reddy also mentioned that the State government had not allocated 2,374 acres of land to UoH through the Advance Possession Method (APM) in 1973. Later, 400 acres were allocated to IMG BHARAT in 2004 and the Apex Court ruled last year that the land belongs to the government.

He demanded clarification on whether the Congress government transferred HCU lands to TGIIC for off-budget loans to circumvent the FRBM borrowing limits by issuing GO No. 54 on June 26, transferring 400 acres to TGIIC. Reddy alleged that TGIIC faced financial difficulties initially and could not secure loans by mortgaging the lands, as banks require a government guarantee. He explained that if the government provides such a guarantee, it would face issues with the Centre, the RBI, and the FRBM limitations. In this context, TGIIC opted for a “security bonds” approach. ICICI Bank acted as the “account bank,” while Beacon Trusteeship Limited served as the trustee for bond investors’ rights. A tripartite agreement was signed between TGIIC, ICICI Bank, and Beacon Trusteeship Limited, resulting in the release of the bonds. According to this agreement, TGIIC secured a loan of Rs 10,000 crore in December, according to the BJP MLA.