2G Spectrum Scam in India: Government Officials Involved in Undercharging Mobile Companies

Essay on 2G Spectrum Scam B Rajashekar Reddy (1593206) MADS 6604 Ethics and Public Values Prof Brenda Lyshaug, Ph. D. Fairleigh Dickinson University April 01, 2013 “2G” stands for “Second-generation wireless telephone technology”. The 2G scam is one of the biggest scam till now in India and the highest authority of India Supreme Court stated that this scam is mother of all the scam till now in India. In this 2G spectrum scam many government officials are involved for illegally undercharging frequency allocation for the mobile telephonic companies.

The difference between the money collected and the money to be obtained is 1, 76,379 crore rupees (USD 39 billion). The issuing of licenses to the mobile companies occurred in 2008, but it first came to notice when the income tax department investigating one of the political person NiraRadia. CBI and CAG are the two investigation agencies involved in the investigation of the 2g scam. CAG is a file based government auditing agency. It focuses on reporting the issues when there is a deviation from the set policies and procedures and also how it is effected the economy growth.

CAG has clearly mentioned that the allotment of licenses was not held in realistic price. That has caused a loss of revenue up to Rs. 176 lakhs crore to the government of India. The report also stated that telecom minister A. Raja has totally ignored the advice of finance ministries on allocation of license to benefit for few operators. It also that all the telecom regulator acts are ignored to misused. CAG also reported that the price at the license was allocated in 2008 are according to the prices in 2001.

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The price is very low when compared to the technology and other development from the year 2008 to 2001 which has resulted in loss to the government. The auction methods followed and the bids to invite the participants to sell the license are not carried out according to proper rules. CAG also stated that telecom ministry has crossed all the financial procedures, policies and rules according to his needs. Raja has issued licenses to the candidates who are ineligible and to the candidates submitted the false documents. From 122 licenses 85 are illegally assigned nd they are not to the mark or rules needed by the telecom regulations act. Government has also formed a special central bureau of investigation team to investigate the case. The charge sheet filled by the CBI has stated that the loss was 309845. 5 million (US$ 5. 7 billion) on 2nd April 2011. As per joint report of Income Tax Department and Central Bureau of Investigation agencies. It has stated that A. Raja could have received an amount of 30 billion rupees (US$ 550 million) as a bribe from the companies for bringing the cut-off date forward for the applicants of spectrum.

The actual date of submission is 1st October 2007 then later it is shifted to 25th September 2007 this shift in the deadline has eliminated many applications and it went favor of some of the applicants. His auction is not done according to the market valuation and instead he adopted the rate of 2001, when the telecom sector was in perfect boom. Actions to prevent such scams All the proceeding done by the parliamentary committees should be made clear to the public and media, so that everyone can clearly understand the issue.

The government needs to take severe and serious actions in such issue that can restrict others to involve in such scam. Government has to prove itself by taking all the actions on the accused independent of their position and personality. Media has to perform its duty by letting out the truth to the public in such issues. Fast track courts are to be established by government to create transparence in the justice in such scams. On May 2007, A. Raja has been appointed as a telecom minister and in august 2007 department of telecommunications DOT has initiated a process of allocation for 2G spectrum.

On 25th of September 2007 telecom ministry issues press not for the deadline for applications as October 1st 2007. The prime minister of India writes to the telecom ministry A. Raja to make sure that all the process of allotment should be carried in a transparent and fair manner and to make sure about the fee with respect to the market value. But, A. Raja has wrote back to prime ministry rejecting many of his suggestions and recommendations. This scam involves many political issues, as A. Raja is member of DMK party which supports congress government in the central.

Some videos related to A. Raja regarding the lobbing for the post of telecom ministry has been leaked to press. That became as a serious issue in the central at the same time 2g scam has been came in to the picture. Congress government thought of laying off the case as it became a prestige issues to the government. In this process the CBI head and Income tax department head has been discharged from their positions and sent to other department. Since, DMK is a supporting party to the government. The government doesn’t want to lose their support as it is very much needed to be in power.

As the video’s regarding the lobbing for the telecom ministry post has went in to the public through media. Then the government stated to resign for the post of telecom minister. Earlier, A. Raja refused to resign but later his is left with no other option. In this scam, the government tried to divert the issue by stating that there was a gain instead of loss to the government. Later, other statement has been issued from government stating that there was a zero loss to the government. This two contradiction statement has created my doubts in the public.

As per the public petition filled by the senior retired officer the Supreme Court has take up the case and on 2nd February 2012 the supreme court of India has stated that the license allocation are done without following any procedures and rules and this directly has favored many companies. A. Raja has been arrested on February 2nd 2011 and this impacted many company shares and share market has been collapsed by 20% on that day. Companies like swan telecom and unitech have got the licenses at very low price and then they sold and given partnership to other companies at very high price when compared to the price that they got the license.

This clearly states the difference between buying and selling price, which has done great loss to the government. For this, A. Raja has taken bribe from the companies indirectly by investing the money into the Kalaignar TV channel in Chennai, which is headed by MP Kanimozhi daughter of DMK party leader M. Karunanidhi. Telecom department need to follow the telecom regulation act and rules and this should be monitored by the department of telecom director. If anything done in wrong way or without following the rules then it should be notified by the director and definite action should be taken like cancelling the licenses.

The government needs to assign this post to talented and trustful and sincere persons like retired IPS officers. This scam could not been occurred if the director of department could have noticed it and complained it to the higher officials. When such bids or allocations are conducted with large amount of money then there need to be some steps should be carried out like perfect document verification and perfect financial statement. Also need to check whether the company has all the eligibilities to apply or not. There need to perfect rules and regulations need to be setup before the process of bid is initialized.

The income tax and CBI need to focus on the participants of the bids. Since, large amount of money is involved in the bid. Government also need to act irrespective to the political issues when such issues occur. Instead of covering those issues the government needs to take transparent and fair action regardless of the political issues and matters. As a government servant A. Raja has misused all his powers and responsibilities for his now needs and work. He used his power to build his own wealth and his fellow beings. As a public and government servant he needs to serve the public with their needs and wants.

He used all the powers for his own interest. As a public servant he has lost all his faith and trust towards the public. He misused the public funds and values of the parliamentary. Which is very unethical to do being in such high position. Beside A. Raja, M. K. Kanimozhi has also involved in the scam. M. K. Kanimozhi is only daughter of five time chief minister of Tamil Nadu, M. Karunanidi representing DMK political party. Kanimozhi is Member of Parliament representing Rajya Sabha for Tamil Nadu. As per the charge sheet Kanimozhi has 20% share in her family owned TV channel Kalaignar in Tamil Nadu.

As per the CBI Kamimozhi is main head behind the scam as she worked with A. Raja to shift the money from the applicants of spectrum to Kalaignar TV about 2 billion. Also, stated that A. Raja has directly involved in launching the TV channel by getting the permission from Ministry of Information and Broadcasting and also from DTH Tata service. She was charged a case to breach the trust by a public servant. She was arrested by CBI on May 20th 2011 and granted bail on November 28th, 2011 after spending in judicial custody. Still the tail is being following in special branch court CBI.

Siddharth Behura is the telecom secretary when whole issue has taken place. Allegation on him is that he has shifted the deadline for the applications so has to avoid some companies. This is total misuse of power. He has been arrested by CBI on Feb 2nd 2011 and granted bail later. RK Chandolia, Raja’s private secretary involved in each and every aspect of the scam. He and Behura both together planned to limit deadline for the applications. He was arrested by CBI on Feb 2nd, 2011 and later granted bail. Irrespective of political pressure the ministry should be handed to well educated and trustful person.

I think the director of department and minister is responsible for the entire scam. The Director of Department position needs filled by the sincere and honest person like retired IPS officers. The CBI offers and income tax department need to work out very effectively. Political pressure should not be applied on both the departments. In most of the cases the CBI is operated by the central government which makes its weaker to actions on the accused. That is not good for the country growth. CBI is a independent department under Supreme Court but most of the cases it work with respect to the ruling party.

The income tax department needs to be more advanced and strengthen. This could reduce the flow of black money in this kind of situations. They need to monitor every action when related to the huge change of money. Media need to be alert in such issue and need provide perfect information to public. In this scam media played a vital role by leaking out the important videos to the public and letting out the truth. Whistle blowing in some situation is very important and in some other situations it create serious problem to the whistle blower.

When coming to this scam I think whistle blowing is right thing to do. Since, the highest position of the department of telecom is involved in it. Report against a minister to any higher authority is not a normal thing. This could be harmful to him and his position in the government. In this scam a government offer has approached to income tax department about the issue and other filled a case in the Supreme Court. As many political and government officials are involved complaint to higher authorities is very risk thing to do.

In this case the government tried to reduce the impact of the issue by withdrawing the head of CBI and Income tax department by this we can understand the political pressure in this issue. Later whistle blowing to the media had made to case to sustain and the accused got arrested. A. Raja has cleared used all his powers for his own purpose. The lobbying for the post of telecom minister itself clearly stated his nature. He didn’t even consider the recommendation and rules that Prime Minister has recommended. His thoughts were to earn and take advantage from his position.

In his views it is ethical for him to do like as he did for his self advantage. The result of Raja’s dissent is the 2G scam. His dissent had done great loss to the government of India. Lot of money has been misdirected from the government treasure which should be used for the public welfare. This issue has lost the trust on the government in the public. The entire license issued by the Raja has been dismissed by the government and allocations with new prices are done later. This has been wasted government time and money. The moral principles like not to cheat the public being a public representative are at stake.

The responsibility values as being in the position are at stake. As a responsible person Raja has make all the allotments in fair and transparent manner. He should act in such a way that government and public need to get advantage of it. Everything exposed in this scam are done unethically, being a public servant he should use the power for the public welfare not for his own needs. But Raja has totally misused his power for his personal needs and to give advantage for his own people. To stop such scam CBI and income tax departments need to be provided with full power and no political pressure on them.

Reference 2g scam: Timeline. (2011, OCT 22). THE INDIAN EXPRESS. Retrieved from http://www. indianexpress. com/news/2g-scam-timeline/864055 2g spectrum scam: The story so far. (2011, September 15). NDTV. Retrieved from http://www. ndtv. com/article/india/2g-spectrum-scam-the-story-so-far-133841 Court to consider charge sheet in 2g scam case on feb. 11. (2013, JAN 30). THE HINDU. Retrieved from http://www. thehindu. com/news/national/court-to-consider-charge-sheet-in-2g-scam-case-on-feb-11/article4360930. ece Dhananjay , M. (2011, sept 07). 2g loss? ovt gained over rs 3,000cr: Trai. THE TIME OF INDIA. Retrieved from http://articles. timesofindia. indiatimes. com/2011-09-07/india/30122800_1_spectrum-trai-2g John , R. ( 2012, February 06). India to auction 2g spectrum from scandal-tainted licences. TECHWORLD. Retrieved from http://news. techworld. com/networking/3335201/india-to-auction-2g-spectrum-from-scandal-tainted-licences/ What is the 2g spectrum scam about?. (2012, march 2013). DECCAN HERALD. Retrieved from http://www. deccanherald. com/content/112984/what-2g-spectrum-scam-about. html

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