CURRENT AFFAIRS----2G SCAM What is the spectrum scam? •2G licenses issued to private telecom players at throwaway prices in 2008. •CAG: Spectrum scam has cost the government Rs. 1.76 lakh crore. •CAG: Rules and procedures flouted while issuing licenses. The 2G spectrum scam involved allegations of • under pricing of 2G spectrum Telecom Ministry of India, resulting in loss to the exchequer and • illegal manipulation of the spectrum allocation process to favour a few select companies • According to a report submitted by the Comptroller and Auditor General based on money collected from 3G licenses, the loss to the exchequer due to under pricing of 2G spectrum was 176,379 crore (US$39.16 billion). Why 2G Spectrum scam occurs in India? We know that in the democratic country like India, the Prime minister has all power regarding the management of cabinet ministers but recently, the Indian prime minister Sardar Manmohan Singh has been involved in the 2G spectrum scam because has not acted on the removal of the telecom minister A.Raja and the main reason which has come to notice is that, home minster of India has send the letter to the Prime minister of India regarding the 2G license distribution in which he has explained that government of India should be provided with the revenue share as a part of the premium profit in turns of license distribution but Prime minister has not been responded to the letter and after few days this act spread publically and questions are to be putted from Sardar Manmohan Singh about this act, he explained that he was helpless because of the coalition government but I do not think that was correct reason given by the prime minister against this 2G spectrum scam. The another reason is the involvement of Kanimozhi, Member of Parliament and daughter of DMK head Karunanidhi, the Kanimozhi has taken the help of DMK head karunanidhi( chief minister of Tamil Nadu) in favour of A. Raja( Minister of communication and Information technology) in the distribution of 2G wireless spectrum license in the year 2008 even though it is illegal to distribute licenses without any premium profit for government and all had break all the rules and regulations meant for cabinet ministry, it is great example of how politics work in India and it shows that it is only same caste, culture and sex that matters most for them. Moreover, the welfare of people of India is always neglected by this ministers because their first consideration is to fill their own profit first and then looking for welfare for people of India. In the year 2003, when the BJP government is there in India then the Arun Shourie who was the telecom minister during that point of time has introduced a controversial neutral services license in which some mobile operators are allowed to paid lower license fees for the wireless technology and this law enforces some mobile operating companies to get the license at the cheaper rates at that point of time and A. Raja uses the same approach for the distribution of so many licenses to its known companies and reported that this all companies are following the neutral services agreement but when all these companies are invested later by the Income tax department then government come to know that A. Raja has illegally distributed licenses to various companies. INDIVIDUALS INVOLVED IN THE SCAM All the accused have been booked under sections 120(B) (criminal conspiracy), 468 (Forgery for purpose of cheating), 471 (using as genuine a forged document or electronic record), 420 (cheating and dishonestly inducing delivery of property) and 109 (abetment if the act abetted is committed in consequence, and where no express provision is made for its punishment) of the Indian Penal Code The people involved in the scam are as follows: Politicans, Ministers and Parlimentarians involved 1) A .Raja : He is the Union Cabinet Minister for Communications and Information Technology. The allegations against him are : The Controller and Auditor General holds Raja personally responsible for the sale of 2G spectrum at 2001 rates in 2008, resulting the previously mentioned loss of up to Rs. 1.76 lakh crores (US$40 billion) to the national exchequer. In August, 2010, evidence was submitted by the Controller and Auditor General (CAG) showing that Raja had personally signed and approved the majority of the questionable allocations. 2) Kanimozhi Karunanidhi :He is the Member of Rajya Sabha. The allegations against him are : On April 25, 2011 Kanimozhi was named as a co-conspirator in the supplementary charge sheet filed by the Central Bureau of Investigation (CBI) in connection with the 2G spectrum case. The charge sheet, which was submitted before the Supreme Court establishes how Rs 200 crore connected with the scam traveled from a partnership firm of businessman Shahid Balwa of Swan Telecom to the Karunanidhi family- owned Kalaignar TV.She has been charged with section 7 and 11 of the Prevention of Corruption Act. The sections deal with acceptance of alleged gratification. Bureaucrats involved: Siddhartha Behura : He is the Civil Servant(IAS officer of 1973 batch UP cadre). The allegations against him are : He was the Telecom secretary who served in the DOT at the time of the 2G allocation. P. J. Thomas : He is the Civil Servant(IAS officer of 1973 batch Kerala cadre) The allegations against him are : He was the Secretary of the Department of Telecommunications. On September 7, 2010 he was appointed as the Chief Vigilance Commissioner. Thomas later stepped down after the Supreme Court questioned his track record as a civil servant in the wake of investigations into the 2G spectrum allocation scam. Pradip Baijal : He is Civil Servant(IAS officer of 1966 batch MP cadre). The allegations against him are : He is alleged to have recommended policies that favored certain Telecom companies when he was heading the TRAI. Post retirement, Baijal joined Noesis, a consulting firm.[6][7] Raja has made references to Baijal's decisions in 2003 as the basis for his decisions in 2008; something which has been attacked by Arun Shourie and several media pundits. The houses and offices of the bureaucrat were recently[when?] raided by the Central Bureau of Investigation as part of their investigations. R K Chandolia :He is a Civil Servant(IES officer of 1984 batch cadre).: The allegations against him are : He was private secretary of Raja during UPA-I when the licences were awarded. When Raja became the Telecom Minister once again in UPA-II, Chandolia had been promoted to the Joint Secretary rank. Raja re- designated him Economic Adviser, that gave him the charge of all important policy-related work. Chandolia interacted with all the licensees. It is said that it was Chandolia who, from DDG-access services A K Srivastava's room, had handed out letters of intent to representatives of various companies. Corporations involved The corporations involved in the scam were: 1) 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) 2)Swan Telecom sold 45% of its company stake at huge profit to Emirates Telecommunications Corporation (Etisalat) after buying licensing 3) Loop Mobile 4) Videocon Telecommunications Limited 5) S Tel 6) Reliance Communications 7) Sistema Shyam Mobile (MTS) – Sistema Mobile Russia 8) Vodafone Essar 9) Dishnet Wireless 10) Allianz Infra. Corporate personalities involved 1) Anil Ambani - Reliance Group (ADAG) 2) Shahid Balwa - DB Realty and Etisalat DB Telecom(formerly Swan Telecom) 3) Vinod Goenka - Dynamix Group 4) Venugopal Dhoot - Videocon Group 5) Prashant Ruia - Essar Group All of the above have either been questioned by the CBI or are prospective suspects in the scam. Media persons and lobbyists involved 1) Nira Radia : former airline entrepreneur turned corporate lobbyist whose conversations with politicians and corporate entities were recorded by the government authorities. The contents were later leaked by unknown parties creating the Nira Radia tapes controversy 2) Barkha Dutt :an NDTV journalist alleged to have lobbied for A. Raja's appointment as minister. 3) Vir Sanghvi : a Hindustan Times editor alleged to have edited articles to reduce blame in the Nira Radia tapes. Petitioners to 2g scam Subramaniam Swamy : 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. Paranjoy Guha Thakurta : 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. Prashant Bhushan : on behalf of the Centre for Public Interest Litigation. Anil Kumar:on behalf of the civil society organisationTelecom Watchdog Others :Several eminent people like former chief election commissioners J.M. Lyngdoh, T.S. Krishnamurthy and N. Gopalaswami and former Others central vigilance commissioner (CVC) P. Shankar are also petitioners in the suits filed by civil society groups. IMPACT OF THE 2 G SCAM ON THE INDIAN GOVERNNMENT (Loss to Excheque The Comptroller and Auditor General of India used three different methods to assess the presumptive loss to the exchequer resulting from not auctioning 2G spectrum. The first method was based on the fact that S Tel, one of the licensees, explicitly offered to pay significantly higher license fees for the spectrum. Based on the fees offered by S Tel, the CAG estimated the loss to the exchequer at 67,364 crore (US$14.95 billion) The second method was based on the price discovered by the 3G auction in 2010.