Will probe bank loans against 2G licences: CBI to SC

Source :CNBC-TV18:Friday, January 28, 02:30 pM

In a long overdue step, the CBI today raided the houses of Former Telecom Minister A Raja and seven of his key aides in connection with the 2G spectrum scam. Raids were conducted in 14 places in Delhi and Tamil Nadu. A CBI spokesperson said that search operations began at 6 am and 14 places have been searched so far.

Meanwhile, CBI’s Deputy Inspector General and Spokesperson Vineeta Thakur said that the searches have led to the recovery of incriminating documents.

Thakur said, "The CBI has today conducted searches of residential and official premises of the then Union Minister of Communications and IT. The then PS to Minister of Communication and IT, the then secretary, Department of Telecommunication, the then Additional Secretary, Member Telecom Commission, Department of Telecommunication, Deputy Director General, Access Service Wing, Department of Telecommunication and MD of a Chennai based export firm in connection with investigation in a case registered in connection with irregularities in the allotment of unified access services licenses. The searches started early in the morning and till now 14 places have been searched."

The Supreme Court today said that the ambit of investigations by the CBI into the 2G spectrum allocation scam needs to be widened. The court wants the CBI to investigate the events of 2001 when the NDA government introduced the controversial first-come-first-served policy for spectrum allocation.

Below is a verbatim transcript of CNBC-TV18's Ashok Bagariya's comments. Also watch the accompanying video.

The Supreme Court concluded its hearing in the 2G spectrum scam case and reserved its verdict. Secondly, and the most important thing that happened today was the Supreme Court turned the spotlight on the role of public sector banks on extending of loans to the companies that had got 2G licences. In fact the Supreme Court made very adverse and critical comments against banks saying that they had mortgaged the licences at very high prices.

The Supreme Court went on to say that one particular bank, State Bank of India, had extended a loan of Rs 10,000 crore to a company and that is one dimension which also needs to be looked into. To which, the CBI replied that they would forward this matter to the banking and frauds cell of the CBI which will look into it, and give the preliminary report to the Supreme Court as soon as possible.

But besides that, the enforcement directorate also submitted a status report to the Supreme Court in a sealed envelope. But the most important thing that really came was the ED telling the Supreme Court that as far as the 2G spectrum scam was concerned, the money had come in from 10 different countries and money also had gone from India to 10 different countries. So that was one aspect the ED was looking into.

And lastly and more importantly was the political aspect of this whole thing that the opposition which has been demanding a joint parliamentary probe into this whole telecom scam was caught in the crosswire today when the Supreme Court said that even the 2001 policy of the NDA government and the licences issued by the then NDA government needs to be probed. In fact the court directed the CBI that this whole policy when it started in 2001 should be the scam, should be investigated from that time and date.

Govt to gain Rs 21,717 crore if Trai's 2G formula gets nod

Source :Prabhakar Sinha, TNN, May 21, 2010, 12.48am IST

NEW DELHI: Bonanza for government keeps on growing. If DoT accepts Trai's recommendation that telecom operators must pay for excess 2G spectrum beyond 6.2 MHz, then government will get an additional revenue of Rs 21,717.1 crore.

This is mainly because Trai has linked price of the spectrum excess of 6.2 MHz in a circle to the price evolved in the auction of 3G spectrum, which was completed on Wednesday. As operators have bid aggressively for 3G, the cost of excess spectrum has become substantial. The government so far has not charged any money from the operators for excess spectrum and it was given on the basis of subscriber base in a circle. And, operators need not pay anything for the spectrum up to 6.2 MHz.

If an operator is holding more than 8 MHz but less than 10 MHz, he will have to pay 1.3 times of price of 3G spectrum in that circle. These rates will be applicable, if the operator is holding spectrum in the range of 1800 MHz. As the spectrum in the range of 900 MHz is more efficient than that in 1800 MHz, Trai has recommended to charge more in case of one is holding excess of6.2 MHz spectrum in 900 MHz range. It said that spectrum in the range of 900 MHz will be charged 1.5 times of the price of the spectrum in 1800 MHz.

As Bharti Airtel is holding more than 6.2 MHz spectrum in 13 of the 22 circles it operates, according to the calculation, it will have to pay the maximum amount of Rs 5,816.7 crore. Similarly, the government-owned BSNL, which has excess of 6.2 MHz in all circles, except Delhi and Mumbai, will have to pay Rs 4,970.5 crore. MTNL, which operates in the costliest circles Delhi and Mumbai, will have to pay Rs 4,681.5 crore for the excess of 6.2 MHz spectrum.

Trai's recommendation said that barring Mumbai and Delhi, in all circles, 8 MHz spectrum would be sufficient to give efficient services. In Mumbai and Delhi, Trai suggested that 10 MHz spectrum will be sufficient. Therefore, it said in Mumbai and Delhi, operators should be allowed to keep 10 MHz spectrum and in the rest of the circles it should be capped at 8 MHz. If an operator has more than this in any circle, he will have to return spectrum to compensate those operators, who have not got any spectrum so far.