Raja drags PM, Chidambaram into 2G scam

A Raja said that the decision of not auctioning spectrum was in continuity with the policy pursued by the NDA govt.

Last Updated: Jul 25, 2011, 22:54 PM IST

Zeenews Bureau

New Delhi: Defending himself against corruption charges in the 2G scam, former telecom minister A Raja on Monday sought to drag Prime Minister Manmohan Singh, prompting the opposition BJP to seek his and Home Minister P Chidambaram`s resignation.

Appearing before the special court of the CBI presided over by Judge OP Saini, Raja’s counsel Sushil Kumar said that the minister did no wrong and that PM Manmohan Singh knew of the equity sale of Swan and Unitech to foreign firms, adding that spectrum allocation was carried out during the tenure of P Chidambaram as Finance Minister.

"Telenor buying a stake in Unitech wireless and Etisalat buying a stake in DB Realty - the finance minister approved it in the presence of the Prime Minister. Let the PM deny it," Raja told the court.

The 47-year-old DMK MP pleaded before the special CBI Judge that there was nothing wrong in his decision of not auctioning 2G spectrum and was merely following the policies pursued by his predecessors and the NDA government.

"I had implemented only what I have inherited," Raja said.

Chidambaram clarifies

Chidambaram was quick with his defence. The former finance minister said that the Swan and Unitech did not sell equity to foreign firms; but the foreign companies were inducted by issuing fresh shares by promoters.

“This was discussed in the presence of Prime Minister Manmohan Singh that foreign partners were inducted by issuing fresh shares and there was no sale of spectrum by Unitech or Swan Telecom,” he said.

On the process followed in allocating spectrum, Chidambaram said, “Department of Telecom (DoT) wanted entry fee to remain at 2001 rates; Ministry of Finance (MoF) wanted it to be rediscovered through an auction. MoF only examined whether Swan Telecom and Unitech were divesting stake or diluting shares through fresh equity,” he pointed out.

Current Communications Minister Kapil Sibal, popular for his “Zero loss” theory, also defended the decision taken by Chidambaram and said the dilution of equity by the two companies, as opposed to divestment of stake, was in line with the 1999 policy approved by the National Democratic Alliance government.

"It is unfortunate a responsible party like the Bharatiya Janata Party and its president (Nitin Gadkari) should demand the resignations of the prime minister and then finance minister without any basis whatsoever," Sibal told a press conference.

The Congress party was equally vehement in defending its top party leaders. "The prime minister`s integrity, his honesty or rectitude does not require anybody`s certificate," Congress spokesperson Manish Tiwari said.

Meanwhile, Arun Shourie who was telecom minister in the NDA government agreed with Raja that the latter had discussed the 2G spectrum issue with the PM and then finance minister P Chidambaram before going ahead but refuted his claim of following the NDA policy.

“Why just me?” asks Raja

Earlier, senior Advocate Sushil Kumar, appearing for Raja, said if Raja is being prosecuted for following a certain policy then all Telecom ministers since 1993 are liable to be prosecuted as they too followed the same policy.

"If policy pursued by me was wrong, then all former Telecom ministers since 1993 should also be in jail with me (Raja)," the counsel said while opposing framing of charges against Raja.

He said, "As telecom Minster Arun Shourie distributed 26 licences while Dayanidhi Maran distributed 25 and I (Raja) distributed 122 licences. Numbers make no difference, however, it is to be noted that none of them auctioned the spectrum.

"To give the licence without auction was my obligation. I acted as per the union cabinet`s decision and the finance minister was known to it. If I would have not done that I should have been prosecuted but I only did my duties," Raja`s counsel said, pointing that "no auction was done" in allotting 2G licences.

"The decision to award licence was essentially a policy decision and not the decision by A Raja," his counsel said.

"If they had done no wrong, why am I being questioned? Let them deny that they have not done what I did. I was just following the 2003 Cabinet decision that is not to auction 2G spectrum. If I am following the law, I am not liable to be prosecuted. In fact, I should be rewarded," Raja said.

The DMK MP also questioned CBI for making Swan Telecom and Unitech Wireless as accused and conspirators and leaving out Tata Teleservice and others.

‘I made mobile phones affordable to even a rickshaw walla’

While defending his policy as telecom minister, Raja submitted that it is because of his policy that mobile phone call rates came down and they became affordable to even a `rickshaw wala`.

"It was my obligation to social justice that every man on the street should have a mobile phone. I am a servant of my people and I made the call rates of mobile phone so cheap that even a `rickshaw wala` or a maid servant can be seen using it," Raja said.
Raja alleged that a cartel of telecom players were behind his ordeal as they wanted to put spokes on the entry of new telecom companies in the sector.

"Behind this (his ordeal), there is cartel of some operators which does not want new operators to come in existence. My only sin was that I opened the floodgates (for the operators)," Raja`s counsel submitted before the judge.

Raja, who was arrested on February 2 for his alleged role in the 2G scam, today began his arguments opposing charges of cheating, forgery and criminal conspiracy against him.

CBI had begun its arguments on framing of charges against Raja and 16 others, including three telecom firms, from July 21 and had completed its arguments on July 23.

All the 14 accused including DMK MP Kanimozhi are presently lodged in Tihar Jail.

The decisions by the former telecom minister in 2008 have been questioned by the CBI, which said that by issuing radio spectrum at a mere Rs 1,659 crore (USD 350 million) for a pan-India operation he had caused losses worth thousands of crores to the exchequer.

Nine new telecom companies were issued the radio frequency airwaves, a scarce national resource, to operate second generation (2G) mobile phone services in the country. As many as 122 circle-wise licences were issued.

The probe agency questioned the manner in which the allocations were made.

A new player Swan Telecom had bought licences for 13 circles with the necessary spectrum for USD 340 million but managed to sell a 45 percent stake in the company to UAE`s Etisalat for USD 900 million. This swelled its valuation to USD 2 billion without a single subscriber.

Similarly, another new player, Unitech, paid USD 365 million as licence fee but sold a 60 percent stake to Norway`s Talenor for USD 1.36 billion, taking its valuation to nearly USD 2 billion, again without a single subscriber.