Telecom minister Kapil Sibal on Friday disputed the Comptroller and Auditor General of India’s estimate that the exchequer suffered a presumptive loss of `1.76 lakh crore on account of giving 2G licences in 2008 without an auction, saying there was no such loss.
“Actually the loss is nil ... zero,” said Mr Sibal. He, on the other hand, attacked the BJP, saying the sudden change in the telecom policy by the NDA in April 1999 caused a loss of `1.50 lakh crore. “And this loss is actual loss because it was in the policy,” said Mr Sibal. He said the change in the telecom policy by the NDA was challenged by then President K.R. Narayanan in a letter to Prime Minister Atal Behari Vajpayee as the government was only a care-taker government.
Mr Sibal said the CAG’s estimate of `1.76 lakh crore was fraught with very serious errors which resulted in sensationalism that allowed the Opposition to spread utter falsehoods to the people of India and that the government objects to it. “The figure of `1.76 lakh crore is utterly erroneous. I would have thought that a complicate and complex issue like this shouldn’t have led to conclusions of presumptive loss of this magnitude, which has embarrassed the government,” said the telecom minister.
He said what was allocated to new players was 4.4 MHZ of spectrum. “It is startup spectrum for which there is no charge ... nor in 1999, nor in 2001, nor in 2003, nor in 2005 and nor in 2008. Every Trai recommendation right from 1999 says that 4.4 MHz is startup spectrum and no value has to be taken. So what was the loss,” said Mr Sibal.
Picking holes in the CAG’s estimate, Mr Sibal said the CAG assumed a loss of `36,993 crore for giving spectrum beyond 6.2 MHz to old telecom players, but the fact is that the government will charge a fee for the extra spectrum. Mr Sibal said that for dual licences and new licences the CAG calculated the loss for 6.2 MHz of spectrum, whereas the government has given only 4.4 MHZ in both cases. He claimed that 2G spectrum can’t be equated with 3G spectrum as the latter is at least three times more efficient than 2G spectrum. The CAG had reached the `1.76 lakh crore figure by taking a 2G spectrum price equal to what the government got for 3G spectrum in 2010. Mr Sibal added that 2010 prices cant be taken for calculating spectrum given in 2008 as during the two years in between the market had grown.
He said the government agreed with the CAG that prima facie there was something wrong in the procedures adopted for allocation of 2G spectrum and that is why the telecom ministry has formed a one-man committee to look into the procedures. He said strong action will be taken those found guilty by the committee. The telecom minister claimed that Prime Minister Manmohan Singh was informed about the 2G spectrum pricing in 2007 and he had “accepted” it.