Reality Check India

Spectrum scam and bullet proof vests

Posted in Uncategorized by realitycheck on December 12, 2008

Remember the mumbai police and the commandos.  Remember that many of them died because of our lack of investment in state of the art combat gear and training. You may also have heard about the little spectrum scam.  Read on as I attempt to make a tortuous connection between the two.

There is a little flurry of activity in the court about this little spectrum scam.

Today, the government filed its response to the Delhi High Courts notice.  The response itself is a bunch of meaningless words conveying nothing.  Read it here. Stripped of layers of fat, the essence of the argument is this :

Had spectrum been auctioned, it would not have been possible to collect the higher usage charges of the order of 2-6 per cent and a maintenance and administration cost which, typically of the order of 0.5 to one per cent, could now be recovered in a judicial manner.

Source : The Hindu

In other words, the government is not denying the loss of Rs 55,000 crores. It is merely saying that it can make money annually in little chunks.  This is the classic red herring. Service/Usage charges are an entirely different topic, you can charge market price for spectrum AND derive usage charges.  The question in front of us is ” Did you lose Rs 55,000 Cr today ?”

Let switch to the Progoti Blog for a really good response.

Their deconstruction of all the arguments put forth by the government is simply outstanding.  It has been a while since I read something quite like it. Keep it up guys.

For Raja’s logic to hold, (a) it must be the case that these ‘spectrum usage charges’ and ‘administration and usage’ charges can’t be levied on spectrum on which the correct price has been paid; and (b) the revenue that is gained each year in perpetuity from the spectrum that was given away almost free must be more than the Rs 55,000 crore that has been foregone.

And a snippet that drives home the size of this scam.

As is well-known, Raja gave away 2G spectrum for a song earlier this year and, after token resistance, Singh okayed this since no price was too high for his government’s survival, more so since the price was being paid by the exchequer. This price, we now know was around Rs 55,000 crore, or an amount that’s more than that earmarked for buying defence equipment this year.

Source :  (Emphasis mine)


Thats right ! The size of the scam is greater than the amount we are going to spend on all defence purchases this year.  We can probably give each commando a bullet proof humvee and still have some money left over. How do you think this will make those who wear substandard bulletproof vests feel ?

Yet this story will hardly make a ripple in the media. Why ? Mr Raja has already passed the buck to Mr Singh and Mr Chidambaram, both media darlings. The matter has reached a dead end.

We have absolutely no disagreement with the Finance Ministry over the spectrum and licence fee. We are working in consultation with each other and all decisions have been taken with prior permission of Prime Minister Manmohan Singh”.

Source :  ITExaminer

The Congress is trying to steer clear of the scam. They must not be allowed to, but they will.  Mr Raja must not become the scapegoat, but he will.  He has kept the PM and FM in the loop in every step of the 2G spectrum allocation. If any wrongdoing is found, the PM and FM must also be forced to answer to the public.

More in a later post. Meanwhile check out Barbarindians’ take on it.



I have googled high and low for the website of Swan Telecom. I cant find it.

How many $2 billion companies in the world do not have a website ?

Can you guys locate their site ?  Leave a link in the comments section.

12 Responses

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  1. curdriceaurora said, on December 12, 2008 at 2:17 pm

    it is the same with unitech, their link goes to a blank. these realty firms saw this as another way to make a quick buck and probably roped in a few from the inside.

  2. reasonb said, on December 13, 2008 at 10:22 am

    you are a brahmin and that is why you are asking these questions.

    That is actually very true. isn’t it?

  3. xyz said, on December 13, 2008 at 12:20 pm

    reason b,

    Please do not misunderstand me.

    You are a shudra from TN-who got a seat in OBC quota and a high income indvidual.aren’t you?

    And also one who has a pathological hatred for hindi,hinduism,brahmanas,india ,sanskrit and kannada,not necessarily in that order.

  4. xyz said, on December 13, 2008 at 12:49 pm

    It is quite possible that you are otherwise a reasonable,intelligent and qualified professional who has some literary sensibility,ethical values,tamil racial consciousness who believes in progress,social consciousness and wants to create a better society for all including those at the margins.

    Believe me, everyone here who comment regularly on this blog believe in a plural,inclusive and liberal society.Noone here wants to turn the clock back.

    Speaking for myself,i admire and enjoy tamil literature.But india is a diverse land.There has to rule of law.

    You are imputing pseudo racist motives to defend corruption.

    I presume you are a professional.Yet you seem to have a persecution complex.

    The ‘Shudras’ of TN are shudras only in the sense of Manu which has never had any relevance for TN and definitely not for this age.

    It is a nice convenient label to oppress dalits,discriminate against brahmanas,hoodwink large sections of population,generally obfuscate issues,whip up jingoism while claiming to be ‘ODUKKAPATTAVARKAL’

    I am not going to dissappoint you.

  5. xyz said, on December 13, 2008 at 12:52 pm

    Also a very convenient label to avoid any sort of introspection.

  6. reason said, on December 13, 2008 at 2:28 pm

    actually that comment was from me, a long time reader of this blog. That ‘reasonb b’ got appended by a typo.

    I meant that comment in a serious way. it is true. the only people who are likely to voice any opinion on this sort of huge corruption are those who have nothing at stake. If you have anything at stake – like a quota for your kid at IIT and then at IIM – regardless of your income – you can not afford to allow yourself to get offended by minor transgresses such as these.

    There was a series of comments left in barbarindians’ blog that first irritated me, but on thinking again it was so correct.

  7. realitycheck said, on December 13, 2008 at 6:15 pm

    LOL !!

    Reason – you got xyz’s blood pressure up for nothing.

  8. realitycheck said, on December 13, 2008 at 6:22 pm

    Anyway you look at it, this scam is toooo much. For its sheer size it could probably be the swindle of the millenium. Neither the fodder scam nor the miniscule Bofors scam was this bold and open. It is remarkable in that it is so simple to understand.

    Fact is, no one cares. I was at the railway station last night and thumbed through several magazines (English and Tamil) to see if there were details about the recent events in the court. Not one !

    Funny thing is, Indian intellectuals do not realize they look like jackasses.

    Check this article by an IIM Finance professor about “12 steps to shock and awe the Pakistan economy”.

    Sir, Professor, While you are plotting to shock-and-awe our neighbour, people in power are stealing your underwear.

    Its kind of dismaying the comments to the above article received in Acorn.

  9. Barbarindian said, on December 13, 2008 at 10:14 pm

    About that 12 steps article – the Professor misses the blindingly obvious. The biggest shock and awe to Pakistan’s terror factory can be caused simply by an Indian economic powerhouse. If India was say 10 times more prosperous, Pakistani boys would line up for visas at Wagah for seasonal jobs.

    But only Chandra Bhan Prasad wants that outcome.

  10. AB said, on December 18, 2008 at 7:31 am

    The article in progoti first appeared in the Business Standard.( I would have been very surprised if a Commie blog had come up with such good reasoning :P)

    Much of the mainstream media is keeping mum on this.But this one from the Hindu group Frontline takes the cake:

    In the 15 months since he took charge as Union Minister of Communications and Information Technology, A. Raja has ushered in an era of transparency in the functioning of his Ministry.

    Seriously, WTF!

    Anyways, you have been doing a great job in exposing this massive scam.

  11. rc said, on December 18, 2008 at 10:10 am

    How audacious of Frontline !! The issue is dated Dec 20 and completely ignores the scam. It is even poorly edited (Rasa says we have *only* 3500 Crore connections !) WTF !

    Frontline runs ‘tasks’ not ‘stories’.

    I know a bit much about why they do what they do.

  12. […] 12 2008 : Spectrum Scam and bullet proof vests Thats right ! The size of the scam is greater than the amount we are going to spend on all defence […]

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