It is a disgusting story. Let us begin it in lighter vein. ‘2G’ seems a highly popular name today. Type ‘2G’ in Google search, you will get 55.3 million results in 0.12 seconds! In Google terms, ‘2G’ is 29 times more popular than Shah Rukh Khan; 17 times as popular as Rajnikanth. It is equally as infamous, being the largest scam ever — Rs1.76 lakh crore loot. About something so famous, and at once infamous, the whole nation is asking Manmohan Singh one question: Mr Prime Minister what do you know about ‘2G’? Even as the PM is totally silent, here comes an SMS to all cell phones. ‘The PM finally breaks his silence and says: “The only ‘2G’ I know are: ‘SoniaG and RahulG’.’ Laughing? Here is something to cry about.On November 24, 2010, ‘SoniaG’ certified, “Manmohan Singh is more than 100 per cent honest”. The next day, she proclaimed her ‘zero tolerance’ to corruption. What a tragedy? Certificate of probity from Sonia to Singh! Could anything be more humiliating? For, only five years ago, Manmohan Singh had saved her from the Bofors scam by calling back the red corner notice against her Italian friend Ottavio Quattrocchi (Q), recipient of a third of the pay-off from Bofors. Here is that shameful story in brief. Sten Lindstorm, who was the head of the National Investigation Bureau, equal to the CBI here, had probed the Bofors pay-off in Sweden. He told Outlook (April 6, 1998) that Sonia must explain how the companies owned by Q got fat payoffs from Bofors; what was her nexus with Q; who introduced him to Bofors. Lindstorm said that Q got Bofors payoffs was confirmed. Six years later on April 8, 2004, he wrote that Sonia must be questioned on the scam, asserting, “I know what I am saying”.
The diary of Martin Ardbo, managing director of Bofors and the bribe giver, had mentioned his meeting with “Gandhi Trust lawyer”. Finally Q, who came to India long back virtually as Sonia’s baggage from Italy, behaved exactly like a thief when proof against him emerged; he slipped away from India in 1993, thanks to P V Narasimha Rao yielding to pressure from Sonia. In 1999, Sonia defended Q, pleaded he was innocent; she alleged that the NDA government was hounding him. Ten years later Singh chided his own government for harassing Q. Sonia protected the corrupt Q; Singh allowed him to escape prosecution. And Sonia, a suspect in Bofors bribery, is now the president of the Congress, and chairperson of the National Advisory Council. She condescends to certify Singh’s honesty and shamelessly proclaims that she is zero tolerant to corruption. Isn’t it a double tragedy?
Tsunami of scams
A tsunami of scams in quick succession in recent months has swamped the public domain. First of course is the ‘Raja of Scams’, the 2G Spectrum sale involving a loot of Rs 1,76,000 crore; second, how intriguingly the prime minister, now certified by the Bofors scam suspect as ‘Mr Clean’, silently first and openly later, allowed the scamsters to loot that national asset; third, how the ‘Mr. Clean’ PM sat on Subramanian Swamy’s plea to prosecute A Raja for the scam and is now hiding in legalisms to escape the blame for the delay; fourth, the transcript of the tele-conversation of the high profile PR executive Niira Radia, in which not just the politicians, but many media stars and business magnates stand naked in public for different things, including for having lobbied to make Raja telecom minister; fifth, the Commonwealth Games fraud involving Rs 8,000 crore; sixth, the Adarsh housing scam involving some Rs 600 crore. The gross value of the three loots touches almost Rs1.85 lakh crore, equal to 18.5 per cent of the national budget. Here is a sideshow, the Yeddyurappa scam. Compared to the dacoits who have looted almost Rs1.85 lakh crore, Yeddyurappa, like a frightened pickpocket who when caught, has returned the purse — the land permits — he had picked. Yet, his corruption, though petty in comparison, does make the BJP guilty of moral deficit; he has helped the Rs1.85 lakh crore-loot-accused Congress to accuse the BJP.
Fraudulent policy
The first four items relate to the 2G Scam. The Comptroller and Auditor General (CAG) estimates the 2G loot at between `67,000 crore and `1,76,000 crore. That the public lost heavily by the 2G Spectrum loot was evident on day one. Spectrum is the electromagnetic wave through which the wireless calls, SMSes and data travel from one phone or computer to another. Fraud inhered in the very policy to make spectrum available in 2008 at the price set for it in 2001.
What does selling the spectrum in 2008 at 2001 prices mean?
It is not just the inflation difference for eight years. It is like selling land in 2008 in a city (that has also grown 100 times since) at 2001 land prices. In 2008 alone the real estate stock prices rose, believe it, by 20 times. The only reason that Raja cited for this throwaway pricing was that, in 2003, the NDA government did it at 2001 prices. Look at the comparative facts, then and now. In 2003, only five out of 1,000 Indians owned a phone, globally among the lowest; the total telephone owners were 13 million; and telecom companies, in dead losses till 2006, needed support. But, between 2003 and 2008, the picture changed dramatically. The phone owning population grew by 14 times; telephone owners per thousand population by more than four and half times; telecom revenue by almost four times; telcos stock index by 4.4 times; market capitalisation of telcos by several times. The number of total cell owners was 3 million in 2001; 13 million in 2003, 180 million in 2000; now it is 688 million, 53 times more than in 2003; phone owners per thousand population rose from 3.6 in 2001 to 5 in 2003, and to over 22 in 2008; now it is over 58; Telcos’ revenue rose from Rs 48,000 crore in 2003 to 1,69,000 crore in 2008.
These data mean that the profit earning potential of spectrum was several times more in 2008, as compared to 2001. Again, the Indian mobile phone sector grew even faster after 2008. Since 2004 it was, even now it is, the fastest growing one in the world. It now adds every month 20 million phone connections; this is seven times the total all India connections of just 3 million in 2001. There is huge prosperity ahead too. The mobile phone subscriber base is expected to go up to 993 million by 2013. It needs no seer to say that selling licences in 2008 at 2001 prices was like selling gold in 2008, which will become diamond in 2013, at coal prices in 2001.
PM objects, acquiesces, defends
In September 2007, Raja announced policy to sell new mobile licences/spectrum at 2001 prices. On September 24, he announced that the cut-off date for new applications would be October 1; 575 applications were received by October 1. But a week later, on November 2, Raja stipulated that the applications received after September 25 would not be considered; that is retrospectively the cut-off date was advanced to September 25. Then, after 100 days, suddenly, at 2.30 pm on January 10, Raja announced that those who had filed their applications before September 25, could depute their representatives by 3.30 pm, that is, within 45 minutes, to collect the response and before the day ended, pay for spectrum on First Come First Served (FCFS) basis. There were skirmishes at the DoT office on January 10 to be first in the queue. This process disqualified 454 of the total of 575 applications. But, the chosen ones knew what would happen on January 10. The CAG report says, “13 applicants were ready with DDs drawn on dates prior to the notification itself” — a clear proof that they had prior information.
As the deal began to stink even earlier, in November 2007 the PM, though a month after September 24, objected to the Raja model and asked him to be transparent. Raja responded to him, within hours, insisting that he was only going by the policy (of the previous government) in force. The PM took one whole month and on January 3, 2008, he, quite intriguingly, just ‘acknowledged’ Raja’s letter — virtually giving a go-ahead to Raja. On January 10, Raja completed his fraudulent mission. But the story doesn’t end.
Finally, 15 months later, on May 24, 2010, the PM admitted that Raja had told him that he was only following the policy laid down previously — virtually approving the fraud. It needs no seer to say that to say the loot was no secret affair. It was daylight robbery; as transparent as the PM had wanted it to be. Not just Raja, the PM also must be questioned on why he objected first; why he fell into silence later; why he acquiesced subsequently and why he defended it finally.
Stench out in three ways
The stench of the scam began leaking out in three different ways. First, even before the licences were issued in January 2008, one of the aspirants for all India licence, STel Limited, made an offer to Raja in November 2007 to pay Rs13,621 crore for the licence which Raja was selling at Rs1,658 crore — that is almost nine times the 2001 price. When its offer was rejected, STel moved the Delhi High Court, which allowed its petition. Then Raja’s ministry appealed to the Supreme Court. At that point, under threats, STel owners backed off from the case. But they had set the benchmark. On the basis of STel’s offer the CAG has estimated the loss to the public at Rs 67,300 crore.
Second, two of the new players — Unitech and Swan — who got licences on FCFS basis, sold off a major chunk of shares in their companies at values which were many times the amount they had paid for the licences. Unitech, which had paid a licence fee of Rs1,658 crore, sold 67 per cent of its licence for Rs 6,120 crore; this meant that the full licence value was Rs 9,100 crore. Swan, which had paid Rs 1,537 crore, sold 44.7 per cent of the licence at Rs 3,217 crore; it meant that its licence value was Rs 7,192 crore. STel, which got small licences by paying Rs 25 crore, sold 5.61 per cent of its licence for Rs 238.5 crore; it meant that the value of its licences was Rs 4,251 crore. On the basis of these sales of licences the CAG has calculated the loss at between Rs 57,600 and 69,300 crore.
Third, on the basis of the value realised by the government by auctioning of the licences/spectrum for 3G telephony, the CAG has computed the loss in the sale of 2G licences at 2001 rates, without bidding process, at Rs1,76,645 crore. It is the CAG report that has made the stench unbearable. It came just before the Parliament Winter Session was to open. The opposition got a full toss to hit, which it promptly did. The Parliament has become dysfunctional.
What, who made PM U-turn?
The 2G loot took place in the open, to the view of all including ‘Mr Clean’ Singh and zero-corruption-tolerant Sonia. When CBI raided Raja’s ministry on October 28, 2009, and there were demands that Raja resign, he retorted, “why should I resign? I had done everything in consultation with the PM”.
The PM did not deny that statement. But, months later, on May 24, 2010, the PM said that Raja had “discussed” the issue with him. Any difference between Raja asserting that he had “consulted” the PM and the PM admitting that Raja “discussed” with him? The story is self-evident. The PM’s objection in November 2007 turned into no-objection in January 2008 and finally became his approval in May 2010. But, now, with the CAG exposing the fraud, the PM’s lips remain zipped despite demands from everyone including the Supreme Court that he speaks. Why? Here is a compelling hypothesis.
Between November 2007 and January 2008, someone must have hinted to the PM not to meddle with Raja. There is no other way PM’s November objection could become a meek non-objection in January. Who except Sonia Gandhi could turn the PM’s strong objection into a meek non-objection? And who else could make the PM defend Raja in May 2010. Assume this, then everything falls in place; otherwise nothing is explainable.
Raja, Radia, media
But a parallel development also made the stench difficult to contain. The story here is both spicy and serious. The income tax department had legally tapped the telephone lines of Niira Radia, Delhi’s most enterprising PR executive, who holds the honourable Tata group, on the one hand and the fearsome RIL group on the other. Her nine telephones were tapped for about 180 days from August 20, 2008 and again from May 11, 2009 to July 11, 2009. On the request of the CBI, which began to probe the scam in October 2009, the IT department provided, on November 20, 2009, not the whole, but a small part of the recordings. This in itself has forced many politicians, businessmen and media stars run for cover.
There are 5,400 telephonic conversations involving Niira Radia reportedly recorded; available on the Internet are a mere 102, of which only 23 have been transcribed and printed. So one can estimate the bombs still hidden.
According to the IT department’s brief to the CBI, the transcripts reveal stunning facts like: one, Niira Radia was very close to Raja and was involved in getting 2G licences for three operators, namely, Unitech, Swan, and Datacom; two, Raja himself has equity stakes in the licences he has issued; three, Radia and Kanimozhi worked through Vir Sanghvi and Barkha Dutt, two famed journalists, for negotiating to get Raja in as telecom minister after the elections in 2009; four, Radia was also close to the auditor of Rajathi Ammal, (Karunanidhi’s second wife and Kanimozhi’s mother); five, Radia was also involved in advising on the resale of the licences by Swan and Unitech; and so on. It is a shameful account whose full details are not out yet.
The legally recorded phone conversations indicate that it was Radia who first confirmed to Raja on May 24, 2009 that his name has been cleared for the telecom ministry. Go to http://www.outlookindia.com/article.aspx?268064, and click for the tapes, you can hear Raja asking Radia: “My case is clear, yes?” and Radia replying: “Yours is clear, yeah. Your case was cleared last night only.” The tapes, running to over a hundred, of which only a small part is out in the open, are said to be both juicy and sensational. For instance Radia narrates to Vir Sanghvi on May 23, 2009, at past 10.26 pm about how Dayanidhi Maran was exerting pressure through Karunanidhi’s kin Stalin, Dayalu Ammal and Selvi to get into the Cabinet, and tells, “I believe that Maran has given about 600 crores to Dayalu, Stalin’s mother”. Interesting — and disturbing — isn’t it to hear particularly about sale of ministerial positions within the political family for hundreds of crores? Space constraints cut the shameful long story short for now; more on it later.
The loot is too huge for Raja. The main beneficiaries are obviously hiding behind him. Raja could never have defied the PM on the strength of the DMK alone. The DMK could never have ditched the UPA on this issue. The fear that the DMK would walk out of UPA could not be the reason for the PM to acquiesce. The fraudulent venture must have had the backing of someone more powerful than the PM. That only explains Raja’s defiance of the PM; and the PM acquiescence first and finally his defence of the deal itself.
QED: The PM has now lost the remaining sheen as ‘Mr Clean’. The condescending certificate of honesty from Sonia, who he had saved from the Bofors case, is his ultimate humiliation.
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