watch http://www.ndtv.com/common/videos/embedPlayer.php?id=200315&autoplay=0&pWidth=418&pHeight=385&category=embedThe Indian Central Bureau of Investigation is looking into alleged discrepancies in the ownership change in Aircel by Ananda Krishnan’s Maxis Communications.. with its image dented by scams, the Congress-led UPA government on Sunday night pledged to take corruption head on and promised to punish the guilty, demonstrating through actions and not not words what it meant. Presenting the UPA’s report card on completion of two years in the second term, Prime MinisterManmohan Singh and UPA chairperson Sonia Gandhi gave an assurance that the government would prevent scams in future and reduce discretionary and arbitrary use of powers by public officials.
With his government reeling under attack over several scams in the last many months, Singh said, “there is the challenge of good governance and the need for political stability.
“In the past several months, a conjunction of several developments relating to 2G spectrum allocation, procurement and contracting issues related to the Commonwealth Games, and similar issues in state governments have brought public focus on the issue of corruption in public life.”
The Prime Minister said these developments have caused many concerned citizens to worry about the state of governance and the “pervasiveness of corruption”.
“These are legitimate concerns and the UPA government is determined to take corrective action. The due processes of law are already in motion. We are taking steps to prevent such developments in future and reduce discretionary and arbitrary use of power by public officials,” Singh said.
Speaking on the occasion, Gandhi said much has been said about corruption.
“Transparency, accountability and probity are at the very heart of our governance, our actions and we demonstrate this,” the UPA Chairperson said.
At the same time, she took a veiled dig at BJP for not removing Karnataka chief minister over corruption charges, she said, “It is unfortunate that some opposition parties do not share the same high standards of probity when it comes to their own.”
The 74-page report presented the achievements in various fields like economy, agriculture, rural development, education and healthcare.
Both Singh and Gandhi said the UPA government was committed to high economic growth that will be inclusive and containing inflation.
Prime Minister Manmohan Singh’s defence in the 2G spectrum scam is fluctuating from nervous to plain weak. He insisted in Parliament last week that the finance and telecom ministries had concurred that auctions need not be held for determining the entry fee for startup 2G spectrum in 2008. Singh offered the same explanation at his media interaction on February 16.
The PM is using this “concurrence” as a critical argument to establish that he had rock solid reasons for standing aside while then telecom minister A Raja gave away precious spectrum in 2008 at 2001 prices — causing a staggering Rs 1.76 lakh crore loss to the public purse.
These remarks are sure to become the foundation for all inquiry by the JPC which will examine all procedural improprieties in the 2G scam under its terms of reference.
To begin with, why is the finance ministry’s concurrence any justification for a white-collar crime of this magnitude? At best, this only proves more firmly what everyone has suspected all along, that Raja wasn’t alone.
However, Singh’s argument, apart from being misguided and an own-goal (by implicating a Cabinet colleague), fails scrutiny yet again. There is as yet no information available in the public domain that can substantiate the PM’s claim that the finance ministry was consulted by the DoT and that “the two ministries concurred” before news broke of the 2G spectrum scam on January 10, 2008.
Ironically, after initially admitting in Parliament a difference of opinion between the finance and telecom ministries, the PM later said the two ministries agreed.
The finance minister wrote to the PM on January 15, 2008. According to the PM, later on, the two ministries “worked out an agreed formula on spectrum charges, which was then communicated to me on July 4, 2008”.
Then finance minister P Chidambaram’s letter of January 15, 2008, which is now being offered as evidence of concurrence, was written five days after the LoIs were awarded and refers to issues other than auction of entry fee for startup 2G spectrum. In Section 9 of his letter, Chidamabaram clarifies, “this note does not deal with the need, if any, to revise entry fee”.
In this context, the PM’s statement is puzzling. Moreover, this “agreed formula” between the ministries, which was sent to the PM in July, comes six months after 2G licences were awarded on January 10, 2007, which only confirms that there was no concurrence before the LoIs were awarded. Moreover, “spectrum charges” is not the relevant issue for the 2G scam. The foundation of the 2G spectrum scam is that the entry fee for startup spectrum should have been obtained through a transparent auction. This jargon of entry fee and spectrum charges can be confusing but the devil as always, lies in the detail. Spectrum charge is an additional recurring fee that is paid by operators for the entire duration of license.
All recent inquiries by government panels also contradict the PM’s claim. The Shivraj Patil One Man Committee (OMC), which was set up by telecom minister Kapil Sibal, clearly outlines in Section 2.71 of its report that the department of economic affairs had raised concerns about A Raja’s policies.
Then finance secretary (now RBI governor) D Subbarao had written to the DoT questioning the giving away of spectrum in 2008 at 2001 prices, and specifically added: “Moreover in view of the financial implications, the Ministry of Finance (MoF) should have been consulted in the matter before you had finalized the decision.”
On November 29, 2007, the DoT secretary responded to Subbarao’s letter, but that does not satisfy Patil regarding “concurrence” on the 2G entry fee pricing between MoF and DoT. Patil notes in Section 3.2(xviii): “A procedure was formulated by DoT to collect the same entry fee paid by fourth cellular operator for inducting new UASL operators from 2003 onwards. This had financial bearing and also involved pricing of spectrum. This decision was not only contrary to recommendations of TRAI but was also taken without concurrence by MoF as required by GoI (Transaction of Business) rules and also as per decision of the Cabinet dated 31-10-03.”
Additionally, the DoT in its affidavit of November 11, 2010, informed the Supreme Court in Section 93 that there was “no further reference or communication” between MoF and DoT on this matter after the exchange of letters between the two secretaries.
The CAG’s report, released in November 2010, two years after the spectrum scam, additionally weakens the concurrence theory. It quotes MoF in Section 3.2.5: “In view of the directions of Union Cabinet (October 2003) and particularly in absence of requisite clarity in the recommendations of TRAI and decision of the Union Cabinet, in regard to the fixation of entry fees for new licensees, prudent principles of governance would have required DoT to engage in further inter-ministerial discussion particularly with MoF. The fact that this was not done despite repeated advices from the MoF does give scope of creation of doubt on the validity of the decision taken to fix the entry fee for new licenses at 2001 levels.”
Even when Subbarao recently deposed before the PAC, he made no admission of any concurrence between the two ministries.
It is now up to the JPC to unravel the truth by sifting through this maze of obfuscating material to propel the inquiry to its logical conclusion: recovery of lost revenue. The question is, does the JPC have the appropriate mix of neutral MPs with the expertise and patience to bring the perpetrators and beneficiaries of the scam (including some of their own) to book?
Business tycoon T Ananda Krishnan could face Indian investigations over his takeover of Chennai-based cellular company Aircel in 2006.
The report further stated that CBI was also investigating Ananda Krishnan’s satellite station Astro All Asia Networks’ (Astro) Rs830 crore investment in Sun Direct TV to see if it was linked with the Aircel buyover.