Spectrum of a scam


Rs 1,00,000 crore spectrum sale scam in the telecom sector is a manifestation of how UPA allies are bleeding the nation.

Hardnews Bureau Delhi

Had it not been for the Mumbai terror attacks, Communication Minister A. Raja would have been the target of the opposition parties for facilitating what the Communist Party (Marxist) calls the "Rs 1, 00,000 crore scam". Spectrums are allocated through auctions all over the world.

Although CPM's Basudev Acharia had raised the issue of the spectrum scam and questioned how this scarce and valuable resource was given away without an auction, the scandal did not get the attention it deserved. The focus from the gargantuan scandal was taken away by the horrific happenings in Mumbai. Focus on national security issues stole the limelight away from matters pertaining to blatant loot of national resources. Due to the fractured polity and compulsions of running a coalition, there has not yet been a serious probe into the manner in which the spectrum, used by telecom companies for operationalising mobile telephony, was really allocated. So big is the scandal that it is unlikely to go away soon despite the involvement of some key political personalities. Informed sources claim that some of the companies that have benefited from the spectrum sale have interests that are represented by the progenies of two big politicians. Political circles are agog with rumours about the copious amount of money politicians and bureaucrats have made from this deal. A slew of PILs and investigation by vigilance commission and comptroller and auditor general will continue to breathe life into those who want to know the identity of beneficiaries as well as those who executed it on their behalf.

Raja claimed that he followed the guidelines issued in 2001 to allocate spectrum on first- come-first-served (FCFS) and the department allocated it in the most opaque manner. On January 10, 2008, the DOT posted on its website at 2.45 pm that the letter of intent would be given between 3.30 pm and 4.30 pm and that application fees (worth over a thousand crore rupees in many cases) would have to be paid immediately by demand draft with supporting documentation. Licences with spectrum were given to those who deposited their fees first (by even a fraction of a second), which caused a scramble for these licenses. CEOs were seen running from one floor to the other. People were bashed up. Quite clearly, such a short notice was given to facilitate those who had already been notified about the issue of licenses.

Companies like Swan Telecom and Unitech got licenses when they did not have the capability to mount a telecom network. Little later, the purpose of this mad scramble was known. Swan telecom allegedly associated with some high profile politicians sold 45 per cent of the stake to Dubai based Etisalat for Rs 4,100 crore, United Wireless sold 60 per cent of the stake to Norway mobile provider, Telenor, for Rs 6, 200 crore. Tata Teleservices, too, sold 26 per cent  of the stake to NTT DoCoMo for Rs 13,230 crore.

Intelligence sources tracking such deals claim that few companies may have given up their entire stake, but are trying to side-step government regulations by showing only part sale of the company.

Not too long ago, it is learnt, the CBI had initiated a preliminary enquiry into the spectrum sale. The investigating agency's initiative created such a scare in communication ministry circles and the DMK that a message was sent out to the central government, to stop prying into the deal, claim sources.

DMK hit back. Sri Lankan government's attack at LTTE (Tamil Tigers) bases and the issue of human rights violation was raised by the DMK and it threatened to withdraw support from the UPA government if it did not tell Colombo to stop its military campaign. Foreign Minister Pranab Mukherjee rushed to Chennai to mollify Tamil Nadu Chief Minister M Karunanidhi. It is not clear what Mukherjee told him and how it was interpreted by the chief minister  daughter, Kanimozhi, but it worked. Interestingly, Sri Lankan forces continue their operations against Tamil Tigers. Evidently, Karunanidhi's concerns
were different.

In the coming issues, Hardnews will delve deeper into this case to find out the names of the benamis who benefited from this deal and other contours of this scam.