‘We saved crores by cancelling MTNL tender’

Tapan Sikdar

Union minister of state for communications Tapan Sikdar had managed to keep his record clean in this happening ministry until recently, when member of Parliament Mani Shankar Aiyer levelled allegations of corruption against him — both in the previous session in Parliament and recently in a column. An emotionally charged Mr Sikdar clarifies his stand in the managed leased line data networks (MLDN) controversy and other issues related to the telecom industry in an exclusive interview with Neeraja Kumar of The Financial Express. Excerpts:

Why was Alcatel not given the order in the MLDN tender brought out by Mahangar Telephone Nigam Limited (MTNL) even though it was allotted the letter of intent (LoI) after it emerged the lowest bidder (L1) in the tender, the bids for which were opened and evaluated in August 2000. Mr Aiyer has charged you with “impropriety leading perhaps to corruption” in this case and demanded that the matter be investigated by a joint parliamentary committee. Your comments.
I am ready to resign if Mani can prove what he is alleging. These allegations are baseless and are inspired by vested political interests. The aim is to attract attention and to gain political mileage in the ongoing power struggle within the Congress party, which was sparked off by the tragic demise of Mr Madhav Rao Scindia.
Alcatel has no issues. It has already apologized to me. The investigation into the award of the LoI to Alcatel started only after a complaint was made by ITI (L2 in the tender), that the tender was wrongly evaluated and Alcatel did not qualify technically to participate in the bid.

The matter was then referred to the Telecommunication Engineering Centre (TEC), which pointed out glaring omissions in the evaluations. This fact was further corroborated by the high-powered committee constituted to investigate the matter and then the additional solicitor general (ASG) also gave the same advice.

It was only after all this, that the file was put up to me and on the basis of the observations made by TEC, the committee and ASG, I ordered disciplinary action against the officers who had attempted to award the tender to a technically non-compliant bidder. Unnecessarily the matter was dragged to the court, which also dismissed the case.

As per Mr Aiyer, the ASG’s advice was that tender could be awarded to ITI, provided it came down to the price quoted by Alcatel.

However, even after ITI failed to match Alcatel’s bid of Rs 63 crore, why is it that the purchase order for Alcatel never materialized?
While MTNL had invited bids for model 3600, Alcatel had submitted its bids for model 3645 — which is cheaper than 3600. This is why ITI could not match the price offered by Alcatel. Incidentally, the market price of the model which Alcatel wanted to sell MTNL for Rs 63 crore is only Rs 39 crore. So in effect, we saved crores of rupees by cancelling this tender.

Will the opening up of Net telephony and ILD policy impact the VSNL valuation?
I don’t think it should have any major impact on VSNL valuations. Besides, this will benefit of subscribers and the nation. VSNL should be given some special benefit to balance any adverse impact.

Government had earlier been quoting funds required to meet the village telephony targets as the excuse for delaying Internet telephony beyond April 2002. Won’t Mr Pramod Mahajan’s decision to allow Internet telephony impact the village telephony targets?
Digital divide between the rich and poor was the reason why we were concerned about Internet telephony benefitting the rich who have access to computers, with the poor being left behind. But now we are confident that we will be able to provide Sanchar Dhabas to all the six lakh villages by end of 2002.