2G SCAM

• About 2G.• What is 2G spectrum scam?• Who are Involved?• Media Responses & Market Response• Steps Taken by Govt.• Political Response to Scam.• Conclusion & Your Thoughts.

• ‘2G’ means: “Second-Generation Wireless Telephone Technology”

1. The 2G spectrum scam involved officials and ministers in the Government of India illegally undercharging mobile telephony companies for frequency allocation licenses, which they would use to create 2G subscriptions for cell phones.

2. According to a report submitted by the Comptroller and Auditor General based on money collected from 3G licenses, the loss to the exchequer was 176,379 crore (US$38.27 billion).

3. The issuing of the 2G licenses occurred in 2008, but the scam came to public notice when the Indian Income Tax Department investigated political lobbyist Niira Radia and the Supreme Court of India took Subramaniam Swamy's complaints on record [With Case type: Write Petition (Civil),Case No:10, Year:2011]. The case details of the main PIL filed with the supreme court is Type: Write Petition (Civil),Case No:423, Year:2010.

One of the main person behind the India’s Largest Corporate Fraud.

A. Raja 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.

B. Raja was first elected to the Lok 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.

C. 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.

Anil Ambani - Reliance Group (ADAG)Shahid Balwa - DB Realty and DB Etisalat (Swan Telecom) Vinod Goenka - Dynamix Group Venugopal Dhoot - Videocon GroupPrashant Ruia - Essar Group

All of them have either been question by the CBI or are prospective suspects in the scam.

Nira Radia, a former airline entrepreneur turned corporate lobbyist whose conversations with politicians and corporate entities were recorded by the government authorities and leaked creating the “Nira Radia tapes controversy”.

Barkha Dutt, an NDTV journalist alleged to have lobbied for A.Raja's appointment as minister.

Vir Sanghvi, a Hindustan Times editor alleged to have edited articles to reduce blame in the Nira Radia tapes.

• The first casualty in Stock Markets once Raja was arrested was DB Realty.

• DB Realty had given 200+ crores to Kalaignar TV (owned by Karunanidhi's Wife) .

• The news led to 20% fall in the stock prices of DB Realty.

Relationship between media

&government

• Media sources such as OPEN and Outlook reported that Barkha Dutt and Vir Sanghvi knew that corporate lobbyist Nira Radia was influencing the decisions of A. Raja.

• The critics alleged that Dutt and Sanghvi knew about corruption between the government and the media industry, supported this corrupt activity, and suppressed news reporting the discovery of the corruption.

The tapes leaked to the public include conversations between Nira Radia and Ratan Tata. Tata petitioned the government to acknowledge his right to privacy and demanded accountability for the leak, with the Minister for Home Affairs, CBI, Indian Income Tax Department, the Department of Telecommunication, and the Department of Information Technology as respondents in the petition.

• Nira Radia• M.Karunanidhi• A Raja (Telecom minister)• Arun Jaitley• Barkha dutt (Journalist)• Arun Shourie• Pramod Mahajan

Unitech Group:A real estate company entering the telecom industry with its 2G bid; sold 60% of its company stake at huge profit to Telenor after buying licensing (Including land values properties for towers).Swan Telecom:It sold 45% of its company stake at huge profit to Emirates Telecommunications Corporation (Etisalat) after buying licensing.Videocon Telecommunications LimitedReliance CommunicationsSistema Shyam Mobile (MTS) – Sistema Mobile Russia Tata CommunicationsVodafone EssarLoop MobileS TelAllianz Infra

Corporations involved

Response to scaM

• In early November 2010 Jayalalithaa accused the Tamil Nadu state chief minister M Karunanidhi of protecting A.Raja from corruption charges and called for A. Raja's resignation. By mid November A.Raja resigned.

• In mid November the comptroller Vinod Rai issued show-cause notices to Unitech, S Tel, Loop Mobile, Datacom (Videocon), and Etisalat to respond to his assertion that all of the 85 licenses granted to these companies did not have the up-front capital required at the time of the application and were in other ways illegal.

In response to the various allegations , the Govt of India has replaced the then incumbent Telecom minister A Raja with Kapil Sibal who has taken up this charge in addition to being the Union minister for Human Resources Development.Mr Sibal contends that the "notional" losses quoted are a result of erroneous calculations and insists that the actual losses are nil.

• The CBI conducted raids on Raja and four other telecom officials - former telecom secretary Siddharth Behura, Raja's personal secretary R K Chandolia, member telecom K Sridhar and DoT deputy director general A K Srivastava on 8 December 2010.

• Raja, Behura and Chandolia were arrested on Feb 2nd 2011.

• The Supreme Court on 2ND FEB 12 ordered the government to revoke all 122 telecoms licences issued under a scandal-tainted 2008 sale.

Response to scaM

Response to scaM

• UNITECH WIRELESS -- 22 licences

• LOOP TELECOM PRIVATE LTD -- 21 licences

• VIDEOCON TELECOMMUNICATIONS -- 21 licences

• IDEA CELLULAR -- 13 licences

• TATA TELESERVICES -- 3 licences

• MOSTELY AFFECTED TELECOM COMPANY IS UNINOR