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The 2 g spectrum scam story


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What happened, how it happened, who were involved. The story behind the 2G spectrum scam.

Published in: News & Politics

The 2 g spectrum scam story

  1. 1. The 2G Spectrum Scam Story<br />
  2. 2. How did it start?<br />On November, 2008, Subramanian Swamy wrote to Prime Minister Manmohan Singh and followed it up with four more letters seeking sanction to prosecute A. Raja in regards to 2G telecom spectrum political corruption scam.<br />When the Prime Minister Manmohan Singh didn't take any decision Swamy went to Supreme Court. On 27 November 2010 Subramanian Swamyanounced that he will file a criminal case against former union minister A. Raja in the 2G Spectrum Scam before the Special Court for Corruption Cases in connection with the charges of irregularities in 2G spectrum allocation<br />
  3. 3. What Happened?<br />2G licenses issued to private telecom players at throwaway prices in 2008<br />CAG: Spectrum scam has cost the government Rs. 1.76 lakh crore<br />CAG: Rules and procedures flouted while issuing licenses.<br />Person accused is the Telecom minister : A.Raja<br />
  4. 4. The Comptroller and Auditor General of India (CAG) said it has submitted to the government the report on the 2G spectrum allotment that is presumed to have caused a revenue loss of up to Rs. 1.76 lakh crore.<br />
  5. 5. CAG Report<br />CAG has accused the telecom ministry for undervaluing 2G spectrum, sold to new players in 2008, and held that the allotment price was not realistic, which has caused a revenue loss of up to Rs. 176,700 crore to the government.<br />The report is also believed to have castigated telecom minister A Raja for ignoring the advice of finance and law ministries on allocation of 2G spectrum to benefit a few operators.<br />It is also believed to have criticised telecom regulator TRAI standing as a helpless spectator when its recommendations were being ignored or misused.<br />The CAG report said the price at which the spectrum was alloted in 2008 was based on 2001 prices, which was quite low and has resulted in a loss to the government exchequer.<br />Also, no proper auction method was followed and no bids were taken to sell out the spectrum.<br />
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  7. 7. Yielding to relentless opposition pressure, Union telecom minister A Raja resigned 0n the wake of the 2G Spectrum allocation scam on 14th november.<br />He was arrested by the CBI on 2nd February.<br />
  8. 8. Who All Benefited from This Scam ?<br />2G spectrum was allocated beyond contracted quantity to 9 firms including Bharti, Vodafone, Idea, BSNL, Reliance, Aircel," the report said.NiiraRadia is said to be involved.Read her details.<br />Department of Telecommunications (DoT) circumvented the rules to help Swan Telecom, which effectively acted as a front for Reliance Telecommunications. The charges in the CAG report are that Swan should not have been considered for a license because Reliance Communications held 10.7% stake in Swan - and according to the rules, a telecom operator cannot own more than 10% stake in another telecom company operating in the same service area. "Email ID of Swan Telecom was shown as that of a Reliance ADA group official<br />
  9. 9. Another big beneficiary of the 2G spectrum allocation was Unitech Wireless, which had no experience in the telecommunication sector.<br />After Unitech got the license for a throwaway price of Rs. 1,661 crore, it sold 60 per cent stake to Telenor Asia for a whopping Rs. 6,200 crore.<br />
  10. 10. Parties Involved with the 2G Case<br />
  11. 11. Politicians involved<br />A. Raja, the Ex-Minister of Communications and Information Technology who was the minister when the controversial second round of spectrum allocations took place. <br />ArunShourie, the minister for Telecom during 2003 in the previous BJP regime. <br />PramodMahajan, the minister for Telecom between 1999 and 2003. <br />
  12. 12. Bureaucrats involved<br />Siddhartha Behura, former telecom secretary who served in the DOT at the time of the 2G allocation.<br />PradipBaijal, a bureaucrat who is alleged to have implemented policies that favored certain Telecom companies when he was heading the TRAI. <br />R K Chandolia, private secretary of Raja during UPA-I when the licences were awarded. He was an Indian Economic Service officer of the 1984 batch cadre.<br />
  13. 13. Corporations involved<br />Unitech Group a real estate company entering the telecom industry with its 2G bid; sold 60% of its company stake at huge profit to Telenor after buying licensing (Including land values properties for towers)<br />Swan Telecom sold 45% of its company stake at huge profit to Emirates Telecommunications Corporation (Etisalat) after buying licensing<br />Loop Mobile<br />Videocon Telecommunications Limited<br />S Tel<br />Reliance Communications<br />SistemaShyam Mobile (MTS) – Sistema Mobile Russia<br />Tata Communications<br />Vodafone Essar<br />Dishnet Wireless<br />Allianz Infra<br />
  14. 14. Media persons and lobbyists involved<br />NiraRadia, a former airline entrepreneur turned corporate lobbyist whose conversations with politicians and corporate entities were recorded by the government authorities and leaked creating the NiraRadia tapes controversy.<br />BarkhaDutt, an NDTV journalist alleged to have lobbied for A. Raja's appointment as minister.<br />VirSanghvi, a Hindustan Times editor alleged to have edited articles to reduce blame in the NiraRadia tapes.<br />
  15. 15. Petitioners<br />SubramaniamSwamy, activist lawyer and politician, whose letters to the Prime Minister demanding action and affidavits and cases in the Supreme Court brought the issue into the public limelight.<br />ParanjoyGuhaThakurta, a journalist who was one among the very first to write on the irregularities in the awarding of 2G spectrum allocation by the Telecom Ministry. He is also one of the petitioners in the 2G PIL currently being heard in the Supreme court.<br />PrashantBhushan, on behalf of the Centre for Public Interest Litigation.<br />Anil Kumar, on behalf of the civil society organisationTelecom Watchdog<br />Others:Several eminent people like former chief election commissioners J.M. Lyngdoh, T.S. Krishnamurthy and N. Gopalaswami and former central vigilance commissioner (CVC) P. Shankar are also petitioners in the suits filed by civil society groups.<br />
  16. 16. What happened after the Scam?<br />The stand-off between the government and the Opposition over 2G scam continues. The Opposition wants a Joint Parliamentary Committee (JPC) to investigate the 2G scam.<br />Parliament has not functioned at all this winter session - the Opposition says it won't let the House get to work till a JPC is announced.<br />
  17. 17. Response to the Scam<br />In early November 2010 Jayalalithaa accused the Tamil Nadu state chief minister M Karunanidhi of protecting A. Raja from corruption charges and called for A. Raja's resignation. By mid November A. Raja resigned.<br />In mid November the comptroller VinodRai issued show-cause notices to Unitech, S Tel, Loop Mobile, Datacom (Videocon), and Etisalat to respond to his assertion that all of the 85 licenses granted to these companies did not have the up-front capital required at the time of the application and were in other ways illegal. Some media sources have speculated that these companies will receive large fines but not have their licenses revoked, as they are currently providing some consumer service.<br />
  18. 18. In response to the various allegations , the Govt of India has replaced the then incumbent Telecom minister ,A Raja with KapilSibal who has taken up this charge in addition to being the Union minister for Human Resources Development.MrSibal contends that the "notional" losses quoted are a result of erroneous calculations and insists that the actual losses are nil.<br />The CBI conducted raids on Raja and four other telecom officials - former telecom secretary SiddharthBehura, Raja's personal secretary R K Chandolia, member telecom K Sridhar and DoT deputy director general A K Srivastava on 8 December 2010.<br />Raja, Behura and Chandolia were arrested on Feb 2nd 2011.<br />
  19. 19. NiiraRadia also seems to be involved in big way with the 2G spectrum scam. <br />DMK party chief Karunanithi also accused of being involved in scam by Swamy.<br />
  20. 20. Online community makes fun of the Scam<br />
  21. 21. Source: <br /><br /><br /><br />