In the interiors of his state, YSR -- as he is popularly known -- touched a chord with citizens via his padyatra s. In Hyderabad, the state capital, he is known for having the blessings and support of Congress party President Sonia Gandhi [Images].

He governs the fastest growing city of India and his flourishing state gives free power to farmers to ensure their votes don't escape from the Congress kitty.

It is because of the support of farmers, coupled with a good monsoon, that YSR has survived as chief minister despite countless attempts by his many adversaries in the Congress party and in the Opposition to dethrone him. But the threat of anti-incumbency now worries him so much that it is imperative for him to win over the Muslim votes.

YSR appears desperate because analysts say that Nara Chandrababu Naidu's [Images] Telugu Desam Party is now on the upswing in Andhra Pradesh.

The chief minister discussed last weekend's blasts in Hyderabad in an exclusive interview with Rediff.com Managing Editor Sheela Bhatt.

Your first reaction after the bomb blasts was surprising. You said this is an international issue and you pointed out the limitations of the state government. How are you going to fight back the terrorists?

(Laughs.) I am supposed to be a very aggressive fellow. It is not that way. I only tried to explain the difficulties in the situation. I never said that we will not rise to the occasion. We will rise to the occasion. We will say that these things should be put down with strong hands.

How are you going to fight back?

We are watching the situation very, very, seriously. I don't want to elaborate right now. We are very serious about the terror threats in the state.

What are the reasons behind Hyderabad becoming so vulnerable?

Three years back, the foreign direct investment scenario was quite bleak. Today, Andhra Pradesh is number two in the country because of our pro-active measures in industrial policies.

Industrial power tariff in Andhra Pradesh is the lowest in the country. So many industries are coming. The industry that makes Apache shoes -- that started construction about 18 months back and completed construction in 10 months -- in the last eight months they have employed 5,000 people in Nellore district.

The logic that the terrorists are targeting Hyderabad because of the growing development is one dimensional. Isn't there a global jihadi network of terrorism? There is a large Hindu-Muslim population in Hyderabad..

I am not disputing that at all. On one side there is big growth. The terrorists do not want growth to take place.

Secondly, there is a large Muslim population. So, any sort of chance of communal tension or communal violence will be there. It will have a followout of activities like this. Naturally, they are trying to target Hyderabad.

Fortunately, for us people are quite mature. People have grown over that age of going into communal violence. In spite of the problem, they understand and see through it that normalcy gets establishes very fast. Like nowhere else, in less than 24 hours, things are absolutely normal.

Some experts say Hyderabad is becoming an informal headquarters for Al Qaeda [Images].

No, absolutely not! There are a few people with some connections to some foreign terrorist organisations. We do have a lot of surveillance and things like that. I am quite sure that we will be able to tackle the situation very efficiently. We should not have any problem.

Are you not worried that security is becoming a big issue?

We will take care of that. In fact, only today we have constituted a special experts' committee to look into the various aspects of it and to come up with answers in a week's time. Everything that has to be done will be taken care of.

It is said that the Mecca Masjid blasts happened and that was a kind of an alarm. In these last three months nothing has been done by the government to raise the public's confidence. And then these twin blasts have happened.

The Mecca Masjid blasts ... yes ... unfortunately, my problem is that I will not be able to spell out all that we are doing. It is not for public consumption. Many of the things that we do, we may not be able to say openly. But, the results you will see.

The Mecca Masjid blasts and the twin blasts are too close. Before, the entire system could be organised the second blasts happened.

Today is the fourth day after the blasts. Do you know who has done it?

Again, I am sorry to say that I will not be able to tell all these things in the open.

Is there a Pakistan connection?

There is a definitely an international connection.

Pakistan or Bangladesh?

My problem is that we can't say that connection straightaway from the government's side.

I wanted to ask you about Pakistan's ISI.

The modules here have some connection with some people in Pakistan and with some people in Bangladesh. That much I can say. These all have international ramifications.

Sir, in the last three years you have been accused of appeasing Muslims, particularly in the way you have fought up to the Supreme Court for reservations for Muslims.

What do you mean? It is an election promise and we are standing by it. It is an election promise to go for their reservation. Do you mean to say that giving reservations to the have nots of the Muslim community is bad? This is something not acceptable to me.

There are accusations...

Arre... forget it ..... this is not correct...

There are allegations that you are soft-peddling the issue of ISI modules in the city.

No, my dear, ISI modules and Muslims at large are totally different. ISI modules are so scattered and a handful of Muslims are in it, maybe non-Muslims, also. They are totally, perverted fellows. They are totally distorted fellows. How can you equate them with normal Muslims and ordinary Muslims who are totally peace loving? This is just not correct.

Outside this room, the perception, I am talking about the perception, is that Hyderabad is doing great on the path of liberalisation and globalisation, here is a CM who is becoming a hero amongst farmers because you are giving free power, but, on the other side your politics vis-a-vis the minorities is going to take AP nowhere.

My commitment to the cause of giving reservation to the minorities is totally correct. It was the election promise and it has got nothing to do with some sort of perverted youth who have got a connection with Bangladesh or Pakistan.

There are some handful of people who have drifted away. How can you equate them with the general Muslim population?

That is correct. But is the local involvement in terrorism not increasing?

What local involvement? There is nothing like involvement!

Has the bomb blasts happened without local involvement?

Just a handful of modules may be there. That doesn't mean that common Muslims are involved in this. The common Muslim is a totally peace-loving person. And, in spite of so many problems, no communal violence is happening in the state.

Reddysaab, how do you see your dream of putting Hyderabad on the map of globalisation and New India in view of these kind of blasts which may put a break on it?

It will be absolutely in line of my vision. At times a big state like Andhra Pradesh because of some jealous people who do not want Andhra Pradesh to progress may create problems like this but we know how to overcome them. We are heading a very competent government and a very competent police administration.

But you have been alleged to have transferred some police officers who were taking firm action against some local people having terror links.

You are talking without proper knowledge. Any transfer is an administrative affair. There is no chance of a political angle or for the reason of appeasing someone.

You have pardoned someone who killed police officer Krishna Prasad whose case was supported by the MIM (Majlis-e-Ittehadul Muslimeen).

What is wrong in it? After passing 15 years in jail if in normal parlance he is coming out, then why...

But he has committed a crime again.

What sort of crime?

He produced a CD provoking Pakistani people to donate for his jihad. He is again in jail. I think you are not aware of it. Anyway... What is your broader message after these blasts?

I am accusing you of coming with a totally distorted version of me and my government. You think that I am appeasing Muslims and because of that all these things are happening.

No, not true. I am only saying that since the last last three years Hyderabad has become vulnerable. Is it wrong to say that?

This is just not correct. We have got a very strong administration. At times in a big state like this things can happen but we are very confident and competent, and we will see to it that we come out of this situation. Right?