Andhra CM YSR Reddy gave Raju 50 acres for SEZ

20 Jan 2009,


HYDERABAD: On a day when Andhra Pradesh chief minister Y S Rajasekhara Reddy denied in New Delhi that his state government had accorded any The Great Fall of Satyam political patronage to the disgraced former chairman of Satyam, B Ramalinga Raju, a government order (GO) has revealed that 50 acres of land were allotted to Satyam in Visakhapatnam for developing an IT SEZ on the specific "instructions of the honourable CM".

Talking to media in New Delhi, Reddy on Monday strongly denied having helped Raju. He also rebutted the charge that his government had helped Maytas acquire land worth Rs 7,000 crore or corner contracts, claiming that the state had a transparent and foolproof system of contract bidding. He said Satyam had got land and contracts because of its competitive bids.

However, GO 1439, issued on December 4, 2008, just a month before the Satyam scam surfaced, openly admits to many violations to favour Raju. While the Vishakapatnam collector had reported the basic value of the land to be Rs 60 lakh to Rs 80 lakh per acre and the auction value being at Rs 4 crore to Rs 4.5 crore per acre, the land was allotted to Satyam at Rs 10 lakh per acre, thus causing a loss of at least Rs 195 crore to the state exchequer.

Not just that, of the 50 acres, 25 acres were taken away from the police who had wanted to construct a Greyhounds commando training centre, and another 25 acres of prime land were taken from the Visakhapatnam Urban Development Authority (VUDA) for allowing Satyam to develop the IT SEZ.

After a meeting chaired by the chief minister, the state government had entered into an MoU with Satyam Computer Services on May 10, 2005, for allotment of 50 acres of land for the IT company for their software development centre at Thotlakonda Hills, Kapuluppada village in Bhimunipatnam mandal of Vishakapatnam district.


At the rate of Rs 10 lakh an acre, Satyam paid the state Rs 5.01 crore and the foundation stone was laid by the chief minister himself on May 11, 2005. The area was subsequently notified as an SEZ through a government order on June 1, 2007.

But before Satyam could take possession of the land, the district collector wrote to the state government stating that the 50 acres that had been given to Satyam were actually part of the 300 acres that the state had already allotted to the police department.

It is in this context that another government order (GO 1439) was issued on December 4, 2008, withdrawing 25 acres from the allotted area of the police department, and another 25 acres was added from the adjoining urban development authority land and given to Satyam.

GO 1439 states, "he (Vishakapatnam collector) has also reported that pursuant to the instructions of the honourable CM and keeping in view the urgency", the land has been allotted to APIIC for onward allotment to Satyam. The GO also states that the state had no choice but to withdraw some of the land allotted to the police and also to take land from the urban development authority as "there is no other suitable land in that locality for allotment to Satyam Computer Services Ltd".

Inexplicably, the GO states that all this was done to "avoid further complications". While the state may now claim that it has cancelled the said allotment of 50 acres to Satyam, the fact is that it was originally allotted to the company on the specific instructions of the chief minister.

In New Delhi, Reddy said that the government has promptly acted to bring the guilty to book. Denying the charge of patronising the Satyam promoter, he said that by the time he had taken over the reins of the state, Raju had already become very big.