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What is 2G spectrum scam?


NDTV Correspondent, Updated: November 16, 2010 12:16 IST

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New Delhi: From the time allegations of misappropriation during the bidding for allocation of 2G spectrum surfaced, till Telecom Minister A Raja's ouster, high drama charged both politics in Delhi and Tamil Nadu. So what exactly is the Spectrum Scam that led to all this?

WHAT IS 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

WHAT ARE THE CHARGES ON FORMER TELECOM MINISTER A RAJA? CHEAP TELECOM LICENSES Entry fee for spectrum licenses in 2008 pegged at 2001 prices Mobile subscriber base had shot up to 350 million in 2008 from 4 million in 2001 NO PROCEDURES FOLLOWED Rules changed after the game had begun Cut-off date for applications advanced by a week Licenses issued on a first-come-first-served basis No proper auction process followed, no bids invited Raja ignored advice of TRAI, Law Ministry, Finance Ministry TRAI had recommended auctioning of spectrum at market rates

FAVOURITISM, CORPORATES ENCASH PREMIUM Unitech, Swan Telecom got licenses without any prior telecom experience Swan Telecom given license even though it did not meet eligibility criteria Swan got license for Rs 1537 crore, sold 45% stake to Etisalat for Rs 4200 crore Unitech Wireless got license for Rs 1661 crore, sold 60% stake for Rs 6200 crore All nine companies paid DoT only Rs 10,772 crore for 2G licences user-generated content: report abuse

What is Scandal of 2G Spectrum?


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In that time he allocated spectrum to companies for very low price that existed in 1998 forgetting the point that the spectrum has become scare and also equipment prices have gone low and people who are joining GSM is incresing that is ARPU's increasing. So utimately money of common people that is goverment money has gone into BIG fishes in the TElecos and they reallocated that to others for more price and made fortunes. _________________________________________ guys i dont know exactly but the thing i understood is, the telecom companies have to get their licences to run their companies. In 2001 the no. of users of telecom were some 4million,at that time the licence to the telecom companies were given at a low price, but at 2008 the no. of telecom users increased to 350 million(350million>>>4million) and the telecom industries paid the same price that is allocated at 2001, this made the companies a great benefit thus making government a loss of 1.76 LAKH CRORE.the main reason behind this loss was A.RAJA, moreover he gave licenses to the companies that did not have eligibility and these companies sold their markets to other companies and made profit.Actually each particular frequency must be sold in auction basis but A.Raja has sold in first-come-first-serve basis..

i think u all know about bandwidth(BW=higher freq-lower freq).. 2g spectrum has bandwidh 30200KHz.. 3g has bandwidth of 15-20MHz(radio frequency).. this Radio frequency is of greater demand because it is used by military and so and so(see http://telecom.tbi.net/freq1.html for details) so this is very costlier than 2g...

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First answer by ID0999306721. Last edit by NiteshJadav. Contributor trust: 1 [recommend contributor]. Question popularity: 1 [recommend question].

Read more: http://wiki.answers.com/Q/What_is_Scandal_of_2G_Spectrum#ixzz1EF77JISR

What Is 2G Spectrum Scam


Add comment Posted by Latest News on 7 December, 2010 6:02:29 PM IST#

The 2G spectrum financial scandal in the Telecommunications and IT Ministry under A.Raja is noteworthy as the largest political corruption case in modern Indian history, amounting to a record $40 billion loss from underpricing to the Government of India. A. Raja is an Indian politician from the DMK. He is a member of the 15th Lok Sabha representing the Nilgiris constituency of Tamil Nadu. On November 14, 2010, he announced that he would step down from his cabinet post, over the 2G spectrum allocation scandal.

A. Raja
From Wikipedia, the free encyclopedia

This article is about a person involved in a current event. Information may change rapidly as the event progresses. (February 2011)

This article may require cleanup to meet Wikipedia's quality standards. Please improve this article if you can. The talk page may contain suggestions. (September 2010)

In this Indian name, the name "Andimuthu" is a patronymic, not a family name, and the person should be referred to by the given name, "Raja".

Andimuthu Raja

Union Cabinet Minister for Communications and Information Technology

In office 20072010 Prime Minister Preceded by Succeeded by Constituency Manmohan Singh Dayanidhi Maran Kapil Sibal Nilgiris

Born

10 May 1963 (age 47) Perambalur, Tamil Nadu,India DMK M.A. Parameswari Mayuri Raja Perambalur Lawyer Politician Hindu

Political party Spouse(s) Children Residence Profession

Religion
As of September 22, 2006 Source: [1]

A. Raja (Tamil: . ) ( ) (born May 10, 1963, Perambalur, Tamil Nadu, India) is an Indian politician from the Dravida Munnetra Kazhagam(DMK) political party. He is a member of the 15th Lok Sabha representing the Nilgiris constituency of Tamil Nadu. Raja was first elected to theLok Sabha in 1996 and first served as minister of state from 1999 to 2003. On being re-elected to the Lok Sabha in 2004, he became a cabinet minister in the UPA government. In 2007, he became cabinet minister for communication and information technology. On being re-elected in 2009 he was again appointed cabinet minister for communication and information technology until being tainted in the 2G spectrum scam and resigning in 2010.

Contents
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1 Resignati ons 2 Spectrum Scandal 3 Referenc es 4 External links

Resignations
On October 17, 2008 he submitted his post-dated resignation to the D.M.K party chief M. Karunanidhi over the killings of Tamil civilians in Sri Lanka.[1] His resignation was a part of the mass resignation of all the D.M.K ministers forming a part of the coalition UPA central government.

On November 14, 2010, he announced that he would step down [2] from his cabinet post, over the 2G spectrum allocation scandal.

Spectrum Scandal
Main article: 2G spectrum scam

Further information: Nira Radia tapes controversy

The 2G spectrum financial scandal in the Telecommunications and IT Ministry under A.Raja is noteworthy as the largest political corruption case in modern Indian history, amounting to a record $40 billion loss from underpricing to the Government of India.[citation needed] The alleged modus operandi was telecom bandwidth being grossly undervalued and offered to a chosen few with vested interests, on a dubious 'First-Come-First-Served' basis. It is alleged that it should have been put under a transparent auction system, purportedly advised by higher office.

The bandwidth-spectrum allocation of 2G bandwidth had later come under criticism for gross irregularities. An FIR filed by the CBI claims that the allocation was not done as per market prices, resulting in a scam worth 200 crore (US$43.4 million).[3] However it had been alleged by Arun Jaitley of Bhartiya Janata Party that the scam is worth around

176,000 crore (US$38.19 billion). The Comptroller 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.
[4]

In August, 2010, evidence was submitted by the Comptroller and Auditor

General (CAG) showing that Raja had personally signed and approved the majority of the questionable allocations. [5] Although the political opposition was demanding his resignation over the 2G spectrum scam, Raja initially refused to resign stating his innocence, and this view was backed by his party president M.Karunanidhi.[6]

The financial scam eventually led to Raja's resignation [7] on the 14th of November, 2010. There will be further criminal investigation and action on Raja with reports being filed by the Comptroller and Auditor General (CAG) and the Central Bureau of Investigation (CBI).

In 2011, the results of an investigation by retired judge Shivraj Patil, who was appointed by current telecom minister Kapil Sibal, has also found Raja to have been directly responsible for "procedural lapses" regarding the spectrum scandal. [8] The The CBI and Enforcement Directorate estimate that Raja made as much as 3,000 crore.[9]

Raja and two former associates were arrested on February 2, 2011. The 3 have been taken to Patiala House Courts for enquiries by the CBI on 3 February 2011[10] He was backed by his party DMK after his arrest and in general meeting in Chennai party passed a resolution in favor of Raja stating that until charges are proven he is not guilty. [11]

Telecom firms under scanner in 2G spectrum scam


Karma Paljor , CNN-IBN
Posted on Nov 12, 2010 at 07:14am IST

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Click to play video New Delhi: Pressure is buildings up on the Congress-led United Progressive Alliance Government to get rid of Union Telecom Minister A Raja for his alleged link to the 2G spectrum scandal. The final Comptroller and Auditor General (CAG) report which CNN-IBN has accessed also shows how some companies which failed to meet the eligibility criteria were favoured by the Telecom Ministry. The report clearly says that many of the companies were privy to insider information and were given undue favours to win the licences. Out of the 122 new licenses that were given out, 85 licenses were won by companies that did not meet the eligibility criteria. Six of the Unitech group companies which applied for licenses for 20 circles did not meet requirements. Such was the hurry to get into telecom that they altered memorandums of association with government clearance and should have been rejected. But in Raja's tenure they ended up winning several circles. According to the CAG 12 companies lied about their paid up capital. Bidders must have a minimum of Rs 3-10 crore as paid up equity capital but most of the companies who won the licenses did not meet the mark. As per the laws a company cannot have stakes in more than one licensee company for the same area. This rule was ignored for Swan Telecom, where Reliance held over 10 per cent equity stake at the time of the license application. The CAG report says Department of Telecom also gave undue benefit to Reliance Communications for introducing GSM in 20 circles almost immediately while others has to wait for a year longer. The fact that many of the original bid winners sold stakes at a huge premium to others shows that there was money to be made. Now that the CAG has certified the allegations, the heat will be on the companies as well. NEWS

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2G scam: Raja resigns, DMK says it's still part of Union Government
NDTV Correspondent, Updated: November 15, 2010 01:46 IST Ads by Google Luxury Home Doors Windows European Quality. Made for India. India's #1 Window & Door Company
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New Delhi: After meeting the Prime Minister this evening, Telecom Minister A Raja confirmed that he had resigned. "In order to avoid embarrassment to the Government and maintain peace and harmony in Parliament, my leader (DMK chief M Karunanidhi) has advised me to resign. I will prove my innocence, I did every thing in accordance with the law. I did a revolution in the Telecom sector. My conscience is clear. I did much for the country, for my people." Raja said. (Watch: A Raja speaks after meeting the PM) Raja's alleged role in the 2G scam had allowed the Opposition to accuse the government of permitting corruption within its ranks. Parliament was stalled all of last week by the Opposition which demanded that Raja be sacked. Just a short while before that, an impatient Raja told reporters at the Delhi airport that there was no question of him stepping down.

Rediff.com Twitter

NDTV Social Live Messenger Gmail Buzz Print However, through the day, the hectic political activity in Delhi and Chennai suggested the opposite. In Delhi, the Congress' top rung, including the Prime Minster and Sonia Gandhi met to discuss Raja's exit. In Chennai, Raja met with DMK chief Karunanidhi twice before heading to Delhi. At one point, seven senior Congress leaders, including Finance Minister P Chidamabaram were reportedly in touch with the DMK to orchestrate Raja's exit. (Read: Karunanidhi stands by Raja) | (Read: Who is A Raja?) Congress spokesperson Jayanthi Natarajan said that the Congress' crucial alliance with the DMK remains unchanged, ending speculation over whether Karunanidhi would exit the UPA Government at the Centre over Raja. The DMK provides the support of 18 MPs to the centre. Karunanidhi was worried about how the dismissal of Raja, a Dalit leader, would be perceived by voters. Tamil Nadu votes in a few months for its next government. The DMK still maintains that Raja has done no wrong. (Watch) BJP spokesperson Prakash Javadekar described Raja's resignation as a victory of the people. (Watch) Raja's term as Telecom Minister seemed headed for an abrupt end after a report by the Government's auditor last week blamed him for costing the government close to Rs. 1.76 lakh crores by undervaluing 2G spectrum in 2008, and, by following unfair practices in deciding who would be awarded 2G licenses. The Comptroller and Auditor General's report (CAG) was leaked to the media. It is to be tabled in Parliament shortly. The Supreme Court which is monitoring the case is scheduled to hear the matter on Monday. Raja's resignation, hours ahead of that hearing, may have been stage-managed by the Government to avoid more embarrassment in court. At an earlier hearing, the court asked why Raja had not been removed from office. The Opposition has also been asking for a Joint Parliamentary Committee to investigate the scam. So far, the Government has not agreed to that demand. WHAT IS THE 2G SCAM? 2G licenses issued in the year 2008 at 2001 prices Raja insisted on 'first come-first served' policy 9 companies got licenses for nearly Rs. 10, 800 crore Some firms sold partial stakes for much higher rates CAG: Govt lost between Rs. 1.4 & 1.76 lakh crore CAG: Raja ignored advice of Law, Finance ministries

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