Two scams account for Rs 2.5 lakh crore

The estimated size of the two scams is a whopping Rs 2.5 lakh crore, never mind the fact that much of the loss is presumptive in nature. Interestingly in the two scams, it is not just an example of the routine politicians and bureaucrats' nexus, it exposed the role of journalists, corporate houses, industry tycoons and lobbyists.

The 2G scam--as per the Comptroller and Auditor General (CAG) presumption-- has caused Rs 1.76 lakh crore loss to exchequer, enough ammunition to opposition parties to nudge the government. 

The scam with the shortest name -- 2G (second generation mobile services)-is almost two years old as the telecom licences were allotted in January, 2008. But it made headlines in the end of 2010 after the CAG submitted its audited report making startling revelations. 

Not only the telecom ministry flouted all laid down rules, it also allotted 122 licences, out of which 85 were illegal as the companies bagged approvals by producing bogus documents.

Now, pressure is mounting on new Telecom Minister Kapil Sibal to act against these companies either by cancelling licences or by imposing hefty penalty. The government is in a quandary as any action against telecoms may lead to a crisis in the sector, which the government may not be ready to face. 

Despite all the controversy, in 2010, the sector grew by 40 per cent, including addition of new subscribers. Telephone connections stood at 742.13 million on October 31, 2010 (compared to 526 million on the same day of last year). Of these, 706.70 million are wireless connections. Of course, the customers did get the benefit from sector's phenomenal growth as the calling rates and SMS charges dropped steeply due to an intense tariff war among the companies.

As the tariff war hurt the companies' profit margins, telecom shares took a beating in the stock market. The companies did not have any option but to resort to slashing charges to expand their customer base. Despite the government allotting spectrum, companies (except BSNL and MTNL) are yet to roll out 3G services (which would open up a new range of services, including data downloads at the shortest possible time). The opening of 3G services has got delayed due to government's condition to companies to share the snooping technology with security agencies.

The mobile number portability (MNP), where the customer can retain his mobile number even after changing service providers, finally got kick started - from Haryana.
Though it was to start early this year, former Telecom minister A Raja  hardly showed any interest to expedite its implementation. Finally, the pan India MNP roll out would be in January.

While this was the saga of telecommunication, the 19th Commonwealth Games held in Delhi in October made news for scams rather than sporting activities. Though the event was successful, spectators did not turn up at most of the venues. The alleged corruption in procurement of equipment and building infrastructure again raised a question mark over purpose of holding such events.

The national capital infrastructure got a boost with more flyovers, better metro connectivity, good roads and more greenery. These benefits did not impress Delhiites much. While various agencies quoted different figures on the spending, the expenditure for the event was nothing less than Rs 70,000 crore. 

The CBI, which is investigating the scam, has arrested three officials in connection with the scam. They have raided several places. Offices and residences of CWG Organising Committee chief  Suresh Kalmadi were also raided. Interestingly the organising committee spent only Rs 1600 crore while rest of the over Rs 68,000 crore was spent by different government agencies. The committee constituted by the Centre under the chairmanship of former CAG V K Shunglu is yet to start its inquiry. 

The investigating agency has identified at least 16 projects with possible irregularities mainly in manipulations of tenders for building stadia and inflating bills for equipment such as treadmills and toilet paper rolls.

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