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KCR, as Rao is popularly known, was administered the oath of office and secrecy by Governor E S L Narasimhan at a simple ceremony on the lawns of Raj Bhavan here.
Along with Rao, party MLC Mohammed Mehmood Ali, who was deputy chief minister in the previous TRS government, took oath as a minister.
Rao was unanimously elected leader of the TRS Legislature Party by the newly-elected MLAs Wednesday.
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The BJP won just one seat in the state.