Former minister arrested in AP liquor transport scam

Based on an FIR registered by AP CID, the ED is investigating allegations of an estimated Rs 195.33 crore loss to state exchequer.

Metro India News | AMARAVATI 

The Enforcement Directorate (ED) has arrested senior YSR Congress Party leader and former minister Karumuri Nageswara Rao in connection with the alleged Andhra Pradesh liquor transport scam, marking a significant escalation in the investigation.

He was taken into custody in Hyderabad’s Kondapur on Sunday. Karumuri’s arrest comes after the Supreme Court rejected his anticipatory bail petition, paving the way for custodial interrogation. During the July 29 hearing, the court reportedly observed that the alleged scam involved more than Rs 350 crore and indicated the need for custodial investigation.

The case centres on alleged irregularities in the liquor transportation tender process during the previous YSRCP government. Investigators have alleged that tender conditions were manipulated to favor certain companies, including Sigma Supply Chain Solutions and Prasad Transports, and that contracts were awarded at rates higher than prevailing market prices. Based on an FIR registered by the Andhra Pradesh CID, the ED is investigating allegations that the irregularities caused an estimated Rs 195.33 crore loss to the state exchequer.

The agency has alleged that businessman Raj Kasireddy and former AP Beverages Corporation managing director Dontireddy Vasudeva Reddy played key roles in the alleged network. The ED is also examining allegations that Karumuri and his son Sunil Kumar had a financial stake in the alleged arrangement and that more than Rs 10 crore in suspected kickbacks reached their family. The ED conducted extensive searches in the case in June, subsequently arresting Raj Kasireddy and Vasudeva Reddy. Karumuri’s son Sunil Kumar was also arrested as the investigation expanded.

With the former minister now in ED custody, investigators are expected to focus on the alleged flow of money, the decision-making behind the transport tenders and the involvement of political and business intermediaries. Karumuri’s arrest has consequently transformed the case from an investigation centered primarily on officials and private entities into a politically significant probe involving a former minister of the previous government. The ED’s custodial questioning is likely to determine whether further arrests or additional financial investigations follow.