Uninterrupted Scams

No government prior to the United Progressive Alliance (UPA) regime and possibly ever will in the future has had to deal with such a dizzyingly long list of corruption scandals — 2G spectrum, the Commonwealth Games, Adarsh Housing, money laundering, S band Spectrum and the rest that have come tumbling out. And the amount involved in each of UPA scams would render all scams in the past to utter shame.

The 2G spectrum scam was a scam that involved politicians and some government officials illegally undercharging mobile telcos for spectrum allocation licenses, which they would then use to provide 2G subscriptions. In 2008, 122 new 2G UAS licenses were given to participating telcos at 2001 price and on a first-come-first serve basis. As per the Controller and Auditor General of India, the shortfall was estimated to be INR1766.45 billion. This estimate was based on the 3G and BWA spectrum Auction which was conducted in the year 2010. As per the chargesheet filed by CBI, several rules were violated and bribes were paid to favor to certain firms during 2G spectrum allocation and the loss was pegged at INR309845.5 million. In reply to CBI, the regulatory Authority (TRAI) said that the government gained over INR30 billion from the 2G spectrum allocation. Similarly, Kapil Sibal (Ex-Comm & IT Minsiter) in 2011 claimed that “zero loss” was caused by distributing 2G licenses on first-come-first-serve basis.

 

The Honorable Supreme Court of India has declared the allotment of spectrum as “unconstitutional and arbitrary” and had quashed all the 122 licenses that were issued in the year 2008 during A. Raja’s tenure (Comm & IT Minister – 2007 to 2009 on petitions filed by Subramanian Swamy and CPIL which had challenged the allotment. The court further added that A. Raja “wanted to favor some companies at the cost of the public exchequer” and “virtually gifted away important national asset”. The bench of Justice GS Singhvi and Justice AK Ganguly imposed fine of INR50 million on Unitech Wireless, Swan Telecom and Tata Teleservices and INR5 million to Loop Telecom, S Tel, Allianz Infratech and Siestema Shyam Tele Services.

 

In November 2007, Dr. Manmohan Singh (former Prime Minister of India) wrote a letter to A. Raja directing him to revise the license fees and to conduct the allotment of 2G spectrum in a fair and transparent manner. In reply, Raja rejected many of his recommendations. In the same month, the Ministry of Finance wrote a letter to DoT raising concerns over the procedure adopted by it but DoT went ahead with its plan. The cut-off dates were also preponed to 25 September 2007 from 1 October 2007. DoT also announced that those who would apply between 3:30 and 4:30 PM on that day, the licenses would be issued to them in accordance with the said policy.

 

In 2011, Time magazine listed the scam at number two on their "Top 10 Abuses of Power" list.

 

Politicians named as accused in the chargesheet filed by CBI and Directorate General of Income Tax Investigation in the Special CBI court. A. Raja and M. K. Kanimozhi were the two politicians who were found accused at that time.

 

Investigations allege that A. Raja could have received INR30 billion for preponing the cut-off dates which eliminated many applications, thus enabling him to favor a few with the spectrum. He manipulated the FCFS policy to ensure that Swan and Unitech got 2G licenses. Neither did he auction them nor did he adopt any market – determined methodology to determine the market value of the spectrum.

 

Investigations allege that Kanimozhi that she was in regular touch with A. Raja and DB Realty Promoter to route INR2 billion to Kalaignar TV.

 

Critics allege that journalists Barkha Dutt and Vir Sanghavi knew that corporate lobbyist Nira Radia was influencing the decision regarding appointment of Telecom Minister (A. Raja). Teleconversations between Nira Radia, Barkha Sutt and Vir Sanghavi were made public by the Outlook magazine.