Well, the government has finally won the battle of FDI in Lok Sabha but one of the other things that made it to the headlines was the re-auction of telecom spectrum.

The 2G scam is very well documented to say the least. CAG had vehemently opposed the FIRST COME FIRST SERVE method adopted by A.Raja and said that it had led to losses to the tune of Rs 1 lakh crores to the exchequer. The Supreme Court, as we all know, had then cancelled licences for 122 circles and had asked the government to auction them again. The government had expected revenue up to Rs 40,000 crores but was able to garner only around 9000 crores from the re-auction. This prompted the finance minister to say that the CAG reports were farce and can’t be vindicated. Also, Kapil Sibbal went on to say that the hype created by the media around the CAG report has put the telecom industry in shambles. They even went on to say that the ‘unreliable’ CAG’s report on Coal can’t be trusted. Hence, COALGATE is a farce as well.

All this said and heard, I tried to do some reading about the matter and my research led to something startling. The veil of honesty from the government is no more there. The government in reality sold just 17 per cent of the overall circles that were told to be sold by the Supreme Court (22 out of 122 to be precise). Also, the 2G spectrum is not as lucrative as it used to be four years back. This is established by the fact that in the year 2008, the number of subscribers was one third of the number in 2012. In other words the market has got a bit saturated and hence the chances of growth are very less. Due to these reasons most of the private players stayed out of the auction process. In some sense one can say that the re-auction vindicated the CAG report.

Everything said and done, one also needs to look at the deeper truth. The truth is staggering to say the least and has led to singeing of emotions among the intellectuals. Everything when studied leads one to look at the cartel that is forming and the policies of the government that are encouraging it. The NATIONAL TELECOM POLICY 2011, in its own subtle ways, encourages the companies to “not to bid for a pan-India spectrum”. At the present one can look at the surface and say that the government and the companies colluded in a way that led to less bids.

All this proves that the government is not serious to stand by its promise to keep fiscal deficit to 5.3% of the Gross Domestic Product (GDP) as the expected 40,000 crore rupees that were expected to be earned through the re-auctioning. The government has decided to re-auction the circles that went unsold in the recent round of auctioning. The auction is to take place on 31 March, 2013 but as everyone knows that the interest among the companied would have waned even more by then and the farce would be complete after the auction. It seems it won’t be long that all of us would develop a siege mentality regarding the union government and even if they do something good in the coming future we won’t trust them.


Leave a Reply