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Thursday, July 5, 2012

2G SPECTRUM SCAM


2G SPECTRUM SCAM


1.         2G Scam.

(a)       2G licenses issued to private telecom players at throwaway prices in 2008.

(b)       CAG: Spectrum scam has cost the government Rs. 1.76 lakh crore.

(c)        CAG: Rules and procedures flouted while issuing licenses.

2.         Charges on Former Telecom Minister, A Raja.

           (a)        Cheap Telecom Licenses.

(i)         Entry fee for spectrum licenses in 2008 pegged at 2001 prices.

(ii)        Mobile subscriber base had shot up to 350 million in 2008 from 4 million in 2001.

            (b)       No Procedures Followed.

(i)         Rules changed after the game had begun.

(ii)        Cut-off date for applications advanced by a week.

(iii)       Licenses issued on a first-come-first-served basis.

(iv)       No proper auction process followed, no bids invited.

(v)        Raja ignored advice of TRAI, Law Ministry, Finance Ministry.

(vi)       TRAI had recommended auctioning of spectrum at market rates.


(c)        Favouritism, Corporates Encash Premium.

(i)         Unitech, Swan Telecom got licenses without any prior telecom experience

(ii)        Swan Telecom given license even though it did not meet eligibility criteria

(iii)       Swan got license for Rs. 1537 crore, sold 45% stake to Etisalat for Rs. 4200 crore

(iv)       Unitech Wireless got license for Rs. 1661 crore, sold 60% stake for Rs. 6200 crore

(v)        All nine companies paid DoT only Rs. 10,772 crore for 2G licences

3.         Controversy.          

(a)       The opposition said that by giving the airwaves cheap, that too in the controversial manner of first-cum-first-served basis, the exchequer had lost billions of dollars. The cut-off date for applications was also arbitrarily advanced.

(b)       Later, based on the auction of airwaves for third generation (3G) services, which got nearly $15 billion to the exchequer, and that for broadband access, which fetched over $8.5 billion, the notional loss was estimated at $38 billion to the exchequer.

(c)        But Prime Minister Manmohan Singh himself defended Raja's decision and said on May 24 that all that his communications minister had done was to implement a policy already in place and none of the norms were flouted.

(d)       Supreme Court asked the solicitor general why the prime minister had not responded to the representation by the opposition to sanction proceedings against Raja.

(e)       The final blow came after the Comptroller and Auditor General of India said the entire process of spectrum allocation was undertaken in an arbitrary manner and that the advise of the industry watchdog was ignored and misused.

4.         Media Pers Inolved.

(a)       Nira Radia, a former airline entrepeneur turned corporate lobbyist whose conversations with politicians and corporate entities were recorded by the government authorities and leaked creating the Nira Radia tapes controversy

(b)       Barkha Dutt, an NDTV journalist alleged to have lobbied for A. Raja's appointment as minister

(c)        Vir Sanghvi, a Hindustan Times editor alleged to have edited articles to reduce blame in the Nira Radia tapes.


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