ED arrests ex-Andhra Pradesh minister Karumuri Nageswara Rao in liquor transport case

Arrest and investigation

The Enforcement Directorate (ED) on Sunday arrested former Andhra Pradesh minister Karumuri Nageswara Rao in connection with its probe into alleged irregularities in the transportation of liquor in the state. The former civil supplies minister in the previous YSRCP government was taken into custody from his residence in Kondapur, Hyderabad.

According to Lokmat Times, the arrest came in connection with an investigation into alleged manipulation of tenders and financial transactions related to the transport of liquor. The agency has already arrested three others in the case, including Nageswara Rao's son, Karumuri Sunil Kumar, former Managing Director of the Andhra Pradesh State Beverages Corporation Ltd (APSBCL), Dontireddy Vasudeva Reddy, and Raj Kesireddy, as reported by Lokmat Times. Moneycontrol noted that the ED registered a case under the Prevention of Money Laundering Act (PMLA) in May, following a CID FIR that alleged a wrongful loss of Rs 195.33 crore to the state exchequer.

The Times of India reported that Nageswara Rao's anticipatory bail pleas had been rejected by both the Andhra Pradesh High Court and the Supreme Court. The ED's case stems from a CID FIR based on a vigilance report, according to The Times of India.

Allegations and financial trail

According to The Times of India, the ED has alleged that Rs 15 crore flowed to Nageswara Rao and his son, Sunil Kumar, through cash and banking transactions from people linked to the liquor syndicate. The agency further alleged that Rao demanded an 85% share of the profits, while Sunil Kumar managed operations through Sree Sudarsana Constructions. The newspaper also reported that the ED provisionally attached assets worth Rs 37.7 crore in August, including land, vehicles, and other properties linked to the proceeds of crime.

Lokmat Times reported that the investigation is based on a complaint from the Additional Secretary (Vigilance) and that the ED found tender conditions were deliberately modified for entities such as Sigma Supply Chain Solutions Pvt Ltd and Prasad Transports. The Hindu added that the agency alleged the YSRCP government paid around Rs 35 per kilometre for transporting liquor against a prevailing rate of Rs 13 per kilometre, claiming large-scale irregularities in the award of tenders.

The Hindu also stated that the ED alleged the transport project generated Rs 349 crore between October 2021 and March 2023, with the agency estimating the proceeds of crime at Rs 195.3 crore.

Political reactions

A section of YSRCP leaders and former ministers have reacted strongly to the arrest. Lokmat Times reported that YSRCP leaders, including Chelluboyina Venugopala Krishna, Anil Kumar Yadav, and Vidadala Rajini, issued a statement condemning the move. They alleged that the case was false and that the targeting of Nageswara Rao, a senior BC leader, and his family amounted to a political vendetta. The Hindu quoted the former ministers as claiming that liquor procurement and sales during the YSRCP government were transparent.

YSRCP Spokesperson Konda Rajeev Gandhi told IANS, as reported by Moneycontrol, that the arrest was a continuation of political vendetta. The Hindu reported that the former ministers also cited irregularities during the previous Chandrababu Naidu government, including allegations of scrapped privilege fees and the proliferation of belt shops and permit rooms.