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'PM, government ignored my warnings about 2G scam'

By Vicky Nanjappa
November 15, 2010 12:36 IST
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Telecom Minister Andimuthu Raja finally yielded to all the pressure exerted on him by the government and the Opposition and stepped down on Sunday night. However, the big question is whether this enough to bring the curtains down on one of biggest scams India has witnessed so far.

Back in 2007, Member of Parliament Rajeev Chandrasekhar had raised the issue and questioned the government's decision to allot 2G spectrum without calling for tenders. Chandrasekhar had warned the prime minister about the non-transparent methods of Raja and the scam that was brewing. He also wrote to all political parties to create a consensus on the issue.

In this interview with's Vicky Nanjappa, the former telecom entrepreneur says his early warning signals about the scam were ignored by the PM.

You had written to the prime minister about the 2G spectrum scam two years ago. What was his response at that point of time?

I have been raising this issue of irregularities in the telecom sector as an MP from since 2007 and have raised the issues in several letters and parliamentary interventions. Earlierm as an entrepreneur I fought the WLL (Wireless in Local Loop) scam in 2001.

In my letter to the prime minister on November 14, 2007, I reiterated that the spectrum allocation process must pass the twin tests of public interest and transparency and questioned why the licence award or spectrum award procedure did not following a tender process -- a route adopted to disburse all previous licences including FM (radio) licences. The prime minister responded with a letter saying he would examine the issue. 

Since writing the letter and till date, do you feel that the prime minister has acted on this issue?

While I do know that PM took cognisance of my letter and the issues I raised, I can't answer that question because it's not clear to the country if he did. The reality is that A Raja, his meek bureaucrats and the silent independent regulator went ahead with the allocation of spectrum, throwing all norms to the wind and caused an enormous loss to the country's exchequer and the people of India.

What do you feel about the overall handling of this issue by the government?

The fact is that this is a swindle -- a white collar crime. There are clear and obvious beneficiaries of this swindle. As with any crime, the government must determine the persons involved -- big and small -- and prosecute and punish them under the law. So far there's no tangible sign that government will do so for this swindle.

You pointed out that some corporates may get away? Has this happened?

The reality is that in scams like thism, for every minister and bureaucrat, there is a group of businessmen involved in such crime. Any government that values its duty towards its people, is duty bound to recover the swindled money from the beneficiaries by way of additional licenses fees and levies. However, the track record of governments to take action -- against corporates that have broken the law -- is very poor in India. In telecom alone there are many cases of blatant legal violations that remain unprosecuted and violators have walked away scot-free.

Could you name the corporates who flouted norms in this scam?

I need not name them -- almost all existing telecom operators, old and new, have benefitted from spectrum without auctions and therefore have participated in defrauding the Indian people.

First Maharashtra Chief Minister Ashok Chavan, then Suresh Kalmadi and now Raja. Do you feel this is India's most corrupt government till date?

Unfortunately there isn't any ranking of corruption. But there is a general perception and understanding that crony capitalism has grown at an unprecedented rate in our country. As Raghuram Rajan, the International Monetary Fund's chief economist said recently, most of India's billionaires have acquired their wealth due to their proximity to politics or politicians.

Our current economic model has two curses -- large government spending budgets and wide discretionary powers with ministers, both of which are designed to foster corruption, and indeed they do. The people of India are getting a raw deal because of governmental corruption -- both central and state governments.

How did you get know about the making of this scam?

The telecom sector has always been notorious for its scams -- with ministers like Sukhram, Pramod Mahajan and now A Raja. It's been a sector where dubious decisions and brazen corruption have always ruled. One of the primary reasons I joined politics was my experiences as a telecom entrepreneur and most recently in 2001-03 with Pramod Mahajan and regulator Pradeep Baijal and the WLL and the ISD call scams.

Which I why I wrote to the PM way back in 2007, warning that the telecom minister's decision was totally flawed and needed to be changed. Given the seriousness of the implications of the minister's decision on the resources that belong to the people our country, I wrote to all political parties to create a consensus on the issue. However, my early warning signals of brewing scam were ignored by the PM and the government. The results are there for everybody to see.

Did you know the extent of money involved in the scam?

It was always clear that the loss to the people of India would be high as I outlined in my recent letter to PM in May 2010, after the 3G auctions. But I am proud of Vinod Rai, our comptroller and auditor general and his team who have fearlessly laid out the exact loss -- and the people of India should stand up and understand that this is all their money that's been handed over to some businessmen.

Was the government worried about losing its coalition partner and hence went soft on Raja?

Governments are custodians of public trust and interest. For those in politics who have a genuine interest in doing good by the people they serve, the priority should be to serve the peoples' interest and not cling shamelessly to power. The nation and people are first -- way above selfish and narrow political interests.

Is punishing Raja sufficient? What according to you should the government do to address this scam?

Everybody is presumed to be innocent till a process of law finds them guilty. A crime of this magnitude -- leading to the loss of Rs 1,70,000 crore to the exchequer -- cannot take place without collusion between bureaucrats, independent regulators and corporates acting in concert. Therefore, if the government is serious about taking action, they must launch an independent investigation to identify all the culprits, make the investigation report public and take exemplary action against the guilty.

Also, action must be initiated to recover the swindled money from the beneficiaries of the swindle.

What role should the courts play in this issue?

Courts will have a role to play only after the government launches an investigation, nails the culprits and bring them to justice. What can courts do if the government refuses to take cognisance of the crime ?

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