Did government bail out L Rajagopal, the ‘pepper-spray MP’?

New Delhi –  For his extreme act, of using pepper spray inside Parliament, Lagadapati Rajagopal has drawn sharp criticism from his Congress party. He was also among the six MPs expelled by the party for moving a no-confidence motion against Prime Minister Manmohan Singh over the Telangana proposal.

But now, Mr Rajagopal faces allegations that the same UPA regime has helped his debt-ridden business empire.

His LANCO group, which he runs with his brother, with interests in power, roadways and mining, is over Rs. 36,000 crore in debt. But recently, one of its arms, LANCO Infratech, which has a debt of Rs. 7,500 crore has been given a Rs. 2,500 crore bailout package by a group of banks. The firm will also receive a two-year interest free holiday, and will have to only invest about Rs. 150 crore from its own pocket.

The group of lenders is made up of public sector banks like Andhra Bank, Punjab National Bank and Punjab & Sind Bank, leading to charges that Mr Rajagopal’s political clout was used to push through a highly generous bailout.

The MP has denied this, saying the banks reschedule loans for everybody, not just for LANCO. He also said that his brother runs the business, not him, and that there were no undue favours shown.

But it’s not just that. Mr Rajagopal is accused of annexing land belonging to the Waqf board for his 100-acres Lanco Hills luxury township in Hyderabad.

The court has allowed him to sell flats in Lanco towers till the dispute is settled, but to his critics, the project explains his anti-Telangana stance.

“So all of these top-notch industrialists who have now metamorphosed into the Members of Parliament and representatives of people, they actually are more in public life to protect their business interests and less the public interests… the lesser priorities are public interests,” KT Rao of the Telangana Rashtra Samithi or TRS said.

But Mr Rajagopal says the land belonged to the government, which was also given to the Indian School of Business, the Urdu Academy and Infosys. He also says the Waqf claim was forged.

As Parliament braces for another stormy week over Telangana, the questions being raised: are the extreme tactics of Andhra Pradesh’s politicians-cum-businessmen like Mr Rajagopal, because of public interest or self-interest?