That’s what India Inc smells like these days if you can breathe through the pepper spray
The real identity of Lagadapati Rajagopal, the Congress party’s pepper-spraying MP from Andhra Pradesh, was not known to me till several hours after he hijacked news TV airtime from Arvind Kejriwal, an occurrence as rare as an Indian cricket victory overseas these days. I have to thank his fellow Telugu MP, Jaganmohan Reddy, for making me understand who we were dealing with and alerting me to the wider significance of his idiotic and criminal deed for everything ranging from Andhra politics to corporate India.
Jagan dropped by our newsroom Thursday evening, fresh from his suspension, along with other Andhra MPs. He outlined his conspiracy theory over tea with the precision of an experienced lawyer. First, can you really expect a chief minister to defy the high command, as Kiran Kumar Reddy is doing, in a party that is known to fire chief ministers in airport lounges? And second, do you know who Lagadapati Rajagopal is? He is the same businessman whose company got a Rs 9,000 crore reprieve in a CDR (corporate debt restructuring) process just the other day. His bankrupt companies were given further loans of Rs 3,500 crore against an equity of just Rs 239 crore. Twenty-seven banks were involved in that bailout. You think, sir, it happened without his government’s help? And would such a man dare to defy his party? He rested his case. The Congress, as usual, was playing a dual game, pretending to create Telangana while unleashing its own fifth column on Parliament to prevent it.
You could argue with Jagan over his theories. But even if he had not intended to do so, he had highlighted for us another implication of the pepper-spray shame, one which goes way beyond Andhra. It underlines the current plight, helplessness and loss of steam in corporate India, and also tells you why it is entirely well deserved.
Rajagopal is our richest Lok Sabha member on the Parliament website. He is the founder and chairman of the LANCO group, a large infrastructure and power conglomerate with listed companies. A couple of years back, LANCO became India’s largest independent power producer. It also started going bust.
By the middle of last year, it was defaulting on repayments to several of its lenders, who had given it Rs 35,000 crore or thereabouts in debt. Particularly troubled was his LANCO Infratech, with over Rs 7,500 crore of stressed loans (out of his total debt of about Rs 35,000 crore against a market cap of less than Rs 1,700 crore and declining), and struggling to pay salaries and carrying out sizeable layoffs. It was not declared bankrupt simply continued…