M A I N   N E W S

CAG got its numbers wrong, claims Sibal
‘If the actual 2G Spectrum licence conditions were factored in, the presumptive loss would be zero’
Aditi Tandon
Tribune News Service

2g: Where Sibal agrees with CAG

New Delhi, January 7
The government today used arithmetic to dismiss the 2G Spectrum scam as a farce, challenging the CAG findings that fuelled the sensation in the first place.

Telecom Minister Kapil Sibal while “revealing the 2G truth to the people” slammed as “utterly erroneous” the presumptive loss of Rs 1.76 lakh crore which the CAG listed in its report to the Finance Ministry in November 2010. The government claimed if the actual licence conditions were factored for, the presumptive loss would be nil.

“We respect the CAG but we are pained at his methodology for arriving at the Rs 1.76 lakh crore loss, which has no basis. The exercise is fraught with serious errors which led to sensation and allowed the Opposition to spread falsehood. We object to that. But to err is human,” Sibal said, claiming that Rs 1,50,000 crore was the only loss to the government due to non-compliance with licence conditions during the NDA regime when the New Telecom Policy 1999 came.

Strangely, the government took months to do its math as the CAG had in July, and again in August 2010, submitted its findings to the Telecom Ministry, and sought its response. The CBI had in October 2009 registered an FIR listing a Rs 22,000 crore loss.

But the government says there’s no loss at all. Its argument is premised on three elements of the CAG’s Rs 1.76 lakh crore presumptive loss: Rs 1.24 lakh crore value of 122 new telecom licences granted in January 2008 by former Telecom Minister A Raja; Rs 37,154 crore worth of dual technology (CDMA/GSM) licences and Rs 36,993 crore worth of new licences beyond 6.2 MHz.

The government, however, says the Spectrum allocated through the controversial licences was only 4.4 MHz and not beyond 6.2 MHz. Further, the licence conditions said additional money to be paid for Spectrum beyond 6.2 MHz would be fixed by the government.

“But we are yet to fix that. So, Rs 39,993 must be excluded from CAG’s estimate as the Spectrum allocated was not beyond 6.2 MHz. Also, Rs 37,154 crore must go as CAG calculated it for 5 MHz allotted to dual technology licencees whereas the allocation was 4.4 MHz,” Sibal said.

The Government’s extended argument was that if 1.8 MHz (6.2 MHz minus 4.4 MHz) value was subtracted from CAG’s Rs 1.24 lakh crore estimate against new licences, the loss would be just Rs 72,000 crore. “And since CAG calculated the loss on 3G Spectrum prices of 2010 and the controversial licences were granted at 2008 rates, the corresponding exclusion of value would reveal just Rs 56,000 crore loss,” the minister added.

He eventually struck off the entire CAG estimate pegging it at zero. For this, he cited TRAI’s recommendations from 1999 to 2010, which said 4.4 MHz was start up Spectrum a new licencee would get at zero cost.

Further to counter the BJP, Sibal listed the NDA’s 10th Plan document, which said revenue generation would not be a major determinant of macro policy in the telecom sector and spectrum policy would be promotional.

“When they (BJP) promote telecom, they are justified; when we do so, we are causing losses. The BJP has double standards,” the minister said, hailing the New Telecom Policy as a benefiter of the “aam aadmi”.

Data shows the policy accrued Rs 1 lakh crore annual benefit to the consumers; per call rate of Rs 32 in 1994 fell to 30 paisa; consumers who paid Rs 1,319 monthly phone bills in 2001 now pay Rs 114.