2G Spectrum Scam

WHAT IS SPECTRUM SCAM?

2G licenses issued to private telecom players at throwaway prices in 2008

Comptroller and Auditor General of India (CAG) reported as:

1. Spectrum scam has cost the government Rs. 1.76 lakh crore
2. Rules and procedures flouted while issuing licenses

THE CHARGES ON TELECOM MINISTER:

• CHEAP TELECOM LICENSES

1. Entry fee for spectrum licenses in 2008 pegged at 2001 prices.
2. Mobile subscriber base had shot up to 350 million in 2008 from 4 million in 2001

•    NO PROCEDURES FOLLOWED

1.  Rules changed after the game had begun
2.  Cut-off date for applications advanced by a week
3.  Licenses issued on a first-come-first-served basis
4.  No proper auction process followed, no bids invited
5.  Raja ignored advice of TRAI, Law Ministry, Finance Ministry
6. TRAI had recommended auctioning of spectrum at market rates 
   

• FAVOURITISM, CORPORATES ENCASH PREMIUM

1.  Unitech, Swan Telecom got licenses without any prior telecom experience
2.  Swan Telecom given license even though it did not meet eligibility criteria
3.  Swan got license for Rs. 1537 crore, sold 45% stake to Etisalat for Rs. 4200 crore
4.  Unitech Wireless got license for Rs. 1661 crore, sold 60% stake for Rs. 6200 crore
5.  All nine companies paid DoT only Rs. 10,772 crore for 2G licences