the 2g spectrum scam story

8/7/2019 The 2G Spectrum Scam Story

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How did it start?How did it start?

On November, 2008, SubramanianOn November, 2008, Subramanian SwamySwamy wrote to Primewrote to Prime

MinisterMinister ManmohanManmohan Singh and followed it up with four moreSingh and followed it up with four more

letters seeking sanction to prosecute A. Raja in regards to 2Gletters seeking sanction to prosecute A. Raja in regards to 2G

telecom spectrum political corruption scam.telecom spectrum political corruption scam.

When the Prime MinisterWhen the Prime Minister ManmohanManmohan Singh didn't take anySingh didn't take any

decisiondecision SwamySwamy went to Supreme Court. On 27 Novemberwent to Supreme Court. On 27 November

2010 Subramanian2010 Subramanian SwamySwamy anouncedanounced that he will file athat he will file a

criminal case against former union minister A. Raja in the 2Gcriminal case against former union minister A. Raja in the 2G

Spectrum Scam before the Special Court for Corruption CasesSpectrum Scam before the Special Court for Corruption Casesin connection with the charges of irregularities in 2Gin connection with the charges of irregularities in 2G

spectrum allocationspectrum allocation



What Happened?What Happened?

2G licenses issued to private telecom players at throwaway2G licenses issued to private telecom players at throwaway

prices in 2008prices in 2008

CAG: Spectrum scam has cost the governmentCAG: Spectrum scam has cost the government RsRs. 1.76 lakh. 1.76 lakh

crorecrore CAG: Rules and procedures flouted while issuing licenses.CAG: Rules and procedures flouted while issuing licenses.

Person accused is the Telecom minister :Person accused is the Telecom minister : A.RajaA.Raja



TheThe Comptroller and Auditor General of India (CAG)Comptroller and Auditor General of India (CAG) said itsaid it

has submitted to the government the report on the 2Ghas submitted to the government the report on the 2G

spectrum allotment that is presumed to have caused aspectrum allotment that is presumed to have caused a

revenue loss of up torevenue loss of up to RsRs. 1.76 lakh. 1.76 lakh crorecrore..



CAG ReportCAG Report

CAG has accused the telecom ministry for undervaluing 2GCAG has accused the telecom ministry for undervaluing 2Gspectrum, sold to new players in 2008, and held that the allotmentspectrum, sold to new players in 2008, and held that the allotmentprice was not realistic, which has caused a revenue loss of up toprice was not realistic, which has caused a revenue loss of up to RsRs..176,700176,700 crorecrore to the government.to the government.

The report is also believed to have castigated telecom minister AThe report is also believed to have castigated telecom minister ARaja for ignoring the advice of finance and law ministries onRaja for ignoring the advice of finance and law ministries onallocation of 2G spectrum to benefit a few operators.allocation of 2G spectrum to benefit a few operators.

It is also believed to have criticised telecom regulator TRAI standingIt is also believed to have criticised telecom regulator TRAI standingas a helpless spectator when its recommendations were beingas a helpless spectator when its recommendations were beingignored or misused.ignored or misused.

The CAG report said the price at which the spectrum wasThe CAG report said the price at which the spectrum was allotedalloted inin2008 was based on 2001 prices, which was quite low and has2008 was based on 2001 prices, which was quite low and hasresulted in a loss to the government exchequer.resulted in a loss to the government exchequer.

Also, no proper auction method was followed and no bids wereAlso, no proper auction method was followed and no bids weretaken to sell out the spectrum.taken to sell out the spectrum.



Yielding to relentless opposition pressure, Union telecomYielding to relentless opposition pressure, Union telecom

minister A Raja resigned 0n the wake of the 2G Spectrumminister A Raja resigned 0n the wake of the 2G Spectrum

allocation scam on 14thallocation scam on 14th novembernovember..

He was arrested by the CBI on 2He was arrested by the CBI on 2ndnd

February.February.



Who All Benefited from This Scam ?Who All Benefited from This Scam ?

2G spectrum was allocated beyond contracted quantity to 9 firms2G spectrum was allocated beyond contracted quantity to 9 firms

includingincluding BhartiBharti, Vodafone, Idea, BSNL, Reliance,, Vodafone, Idea, BSNL, Reliance, AircelAircel," the report," the report

said.Niirasaid.Niira RadiaRadia is said to beis said to be involved.Readinvolved.Read her details.her details.

Department of Telecommunications (DoT) circumvented the rules to helpDepartment of Telecommunications (DoT) circumvented the rules to help

Swan Telecom, which effectively acted as a front for RelianceSwan Telecom, which effectively acted as a front for RelianceTelecommunications. The charges in the CAG report are that Swan shouldTelecommunications. The charges in the CAG report are that Swan should

not have been considered for a license because Reliance Communicationsnot have been considered for a license because Reliance Communications

held 10.7% stake in Swanheld 10.7% stake in Swan -- and according to the rules, a telecom operatorand according to the rules, a telecom operator

cannot own more than 10% stake in another telecom company operatingcannot 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 in the same service area. "Email ID of Swan Telecom was shown as that of

a Reliance ADA group officiala Reliance ADA group official



Another big beneficiary of the 2G spectrum allocation wasAnother big beneficiary of the 2G spectrum allocation was

UnitechUnitech Wireless, which had no experience in theWireless, which had no experience in the

telecommunication sector.telecommunication sector.

AfterAfter UnitechUnitech got the license for a throwaway price of got the license for a throwaway price of RsRs..1,6611,661 crorecrore, it sold 60 per cent stake to Telenor Asia for a, it sold 60 per cent stake to Telenor Asia for a

whoppingwhopping RsRs. 6,200. 6,200 crorecrore..



Parties Involved with the 2G CaseParties Involved with the 2G Case



Politicians involved

A. Raja, the ExA. Raja, the Ex--Minister of Communications and InformationMinister of Communications and Information

Technology who was the minister when the controversialTechnology who was the minister when the controversial

second round of spectrum allocations took place.second round of spectrum allocations took place.

ArunArun ShourieShourie, the minister for Telecom during 2003 in the, the minister for Telecom during 2003 in theprevious BJP regime.previous BJP regime.

PramodPramod MahajanMahajan, the minister for Telecom between 1999 and, the minister for Telecom between 1999 and

2003.2003.



Bureaucrats involved

SiddharthaSiddhartha BehuraBehura, former telecom secretary who served in, former telecom secretary who served in

the DOT at the time of the 2G allocation.the DOT at the time of the 2G allocation.

PradipPradip BaijalBaijal, a bureaucrat who is alleged to have, a bureaucrat who is alleged to have

implemented policies thatimplemented policies that favoredfavored certain Telecom companiescertain Telecom companieswhen he was heading the TRAI.when he was heading the TRAI.

R KR K ChandoliaChandolia, private secretary of Raja during UPA, private secretary of Raja during UPA--I when theI when the

licences were awarded. He was an Indian Economic Servicelicences were awarded. He was an Indian Economic Service

officer of the 1984 batch cadre.officer of the 1984 batch cadre.



Corporations involved

UnitechUnitech Group a real estate company entering the telecom industryGroup a real estate company entering the telecom industry

with its 2G bid; sold 60% of its company stake at huge profit towith its 2G bid; sold 60% of its company stake at huge profit toTelenor after buying licensing (Including land values properties forTelenor after buying licensing (Including land values properties fortowers)towers)

Swan Telecom sold 45% of its company stake at huge profit toSwan Telecom sold 45% of its company stake at huge profit toEmirates Telecommunications Corporation (Emirates Telecommunications Corporation (EtisalatEtisalat) after buying) after buyinglicensinglicensing

Loop MobileLoop Mobile

Videocon Telecommunications LimitedVideocon Telecommunications Limited

S TelS Tel

Reliance CommunicationsReliance Communications

SistemaSistema ShyamShyam Mobile (MTS)Mobile (MTS) SistemaSistema Mobile RussiaMobile Russia

Tata CommunicationsTata Communications

VodafoneVodafone EssarEssar

DishnetDishnet WirelessWireless

Allianz InfraAllianz Infra



Media persons and lobbyists involved

NiraNira RadiaRadia, a former airline entrepreneur turned corporate, a former airline entrepreneur turned corporate

lobbyist whose conversations with politicians and corporatelobbyist whose conversations with politicians and corporate

entities were recorded by the government authorities andentities were recorded by the government authorities and

leaked creating theleaked creating the NiraNira RadiaRadia tapes controversy.tapes controversy.

BarkhaBarkha DuttDutt, an NDTV journalist alleged to have lobbied for A., an NDTV journalist alleged to have lobbied for A.

Raja's appointment as minister.Raja's appointment as minister.

VirVir SanghviSanghvi, a Hindustan Times editor alleged to have edited, a Hindustan Times editor alleged to have edited

articles to reduce blame in thearticles to reduce blame in the NiraNira RadiaRadia tapes.tapes.



Petitioners

SubramaniamSubramaniam SwamySwamy, activist lawyer and politician, whose letters, activist lawyer and politician, whose lettersto the Prime Minister demanding action and affidavits and cases into the Prime Minister demanding action and affidavits and cases inthe Supreme Court brought the issue into the public limelight.the Supreme Court brought the issue into the public limelight.

ParanjoyParanjoy GuhaGuha ThakurtaThakurta, a journalist who was one among the very, a journalist who was one among the veryfirst to write on the irregularities in the awarding of 2G spectrumfirst to write on the irregularities in the awarding of 2G spectrum

allocation by the Telecom Ministry. He is also one of the petitionersallocation by the Telecom Ministry. He is also one of the petitionersin the 2G PIL currently being heard in the Supreme court.in the 2G PIL currently being heard in the Supreme court.

PrashantPrashant BhushanBhushan, on behalf of the Centre for Public Interest, on behalf of the Centre for Public InterestLitigation.Litigation.

Anil Kumar, on behalf of the civil societyAnil Kumar, on behalf of the civil society organisationTelecomorganisationTelecomWatchdogWatchdog

Others:SeveralOthers:Several eminent people like former chief electioneminent people like former chief electioncommissioners J.M.commissioners J.M. LyngdohLyngdoh, T.S. Krishnamurthy and N., T.S. Krishnamurthy and N.GopalaswamiGopalaswami and former central vigilance commissioner (CVC) P.and former central vigilance commissioner (CVC) P.Shankar are also petitioners in the suits filed by civil society groups.Shankar are also petitioners in the suits filed by civil society groups.



What happened after the Scam?What happened after the Scam?

The standThe stand--off between the government and the Oppositionoff between the government and the Opposition

over 2G scam continues. The Opposition wants a Jointover 2G scam continues. The Opposition wants a Joint

Parliamentary Committee (JPC) to investigate the 2G scam.Parliamentary Committee (JPC) to investigate the 2G scam.

Parliament has not functioned at all this winter sessionParliament has not functioned at all this winter session -- thetheOpposition says it won't let the House get to work till a JPC isOpposition says it won't let the House get to work till a JPC is

announced.announced.



Response to the ScamResponse to the Scam

In early November 2010In early November 2010 JayalalithaaJayalalithaa accused the Tamil Naduaccused the Tamil Nadustate chief minister Mstate chief minister M KarunanidhiKarunanidhi of protecting A. Raja fromof protecting A. Raja fromcorruption charges and called for A. Raja's resignation. By midcorruption charges and called for A. Raja's resignation. By midNovember A. Raja resigned.November A. Raja resigned.

In mid November the comptrollerIn mid November the comptroller VinodVinod RaiRai issued showissued show--cause notices tocause notices to UnitechUnitech, S Tel, Loop Mobile,, S Tel, Loop Mobile, DatacomDatacom(Videocon), and(Videocon), and EtisalatEtisalat to respond to his assertion that all of to respond to his assertion that all of the 85 licenses granted to these companies did not have thethe 85 licenses granted to these companies did not have theupup--front capital required at the time of the application andfront capital required at the time of the application and

were in other ways illegal. Some media sources havewere in other ways illegal. Some media sources havespeculated that these companies will receive large fines butspeculated that these companies will receive large fines butnot have their licenses revoked, as they are currentlynot have their licenses revoked, as they are currentlyproviding some consumer service.providing some consumer service.



In response to the various allegations , theIn response to the various allegations , the GovtGovt of India hasof India hasreplaced the then incumbent Telecom minister ,A Raja withreplaced the then incumbent Telecom minister ,A Raja withKapilKapil SibalSibal who has taken up this charge in addition to beingwho has taken up this charge in addition to beingthe Union minister for Human Resourcesthe Union minister for Human Resources Development.MrDevelopment.Mr

SibalSibal contends that the "notional" losses quoted are a resultcontends that the "notional" losses quoted are a resultof erroneous calculations and insists that the actual losses areof erroneous calculations and insists that the actual losses arenil.nil.

The CBI conducted raids on Raja and four other telecomThe CBI conducted raids on Raja and four other telecomofficialsofficials -- former telecom secretaryformer telecom secretary SiddharthSiddharth BehuraBehura, Raja's, Raja's

personal secretary R Kpersonal secretary R K ChandoliaChandolia, member telecom K Sridhar, member telecom K Sridharand DoT deputy director general A Kand DoT deputy director general A K SrivastavaSrivastava on 8on 8December 2010.December 2010.

Raja,Raja, BehuraBehura andand ChandoliaChandolia were arrested on Feb 2nd 2011.were arrested on Feb 2nd 2011.



NiiraNiira RadiaRadia also seems to be involved in big way with the 2Galso seems to be involved in big way with the 2G

spectrum scam.spectrum scam.

DMK party chief DMK party chief KarunanithiKarunanithi also accused of being involved inalso accused of being involved in

scam byscam by SwamySwamy..



Online community makes fun of the ScamOnline community makes fun of the Scam



Source:Source:

httphttp://://mustknowledge.co.ccmustknowledge.co.cc

http://www.indianexpress.com/news/2ghttp://www.indianexpress.com/news/2g--scamscam--extelecomextelecom--

ministerminister--rajaraja--keykey--aidesaides--arrestedarrested--byby--cbi/745123/cbi/745123/http://en.wikipedia.org/wiki/Subramanian_Swamhttp://en.wikipedia.org/wiki/Subramanian_Swam

yy

http://www.thaindian.com/newsportal/indiahttp://www.thaindian.com/newsportal/india--news/2gnews/2g--scamscam--

karunanidhikarunanidhi--sendssends--legallegal--noticenotice--toto--swamyswamy--itit--willwill--landland--inin--dustdust--

binbin--sayssays--swamy_100499193.htmlswamy_100499193.html

the 2g spectrum scam story

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