Maran & Raja to face heat on extra spectrum largesse soon

Written by Rishi Raj | New Delhi | Updated: Sep 15 2011, 09:24am hrs
The Central Bureau of Investigations latest Supreme Court filing on the spectrum scam names NDAs telecom ministers Ram Vilas Paswan and Arun Shourie for indiscretion in allocating spectrum beyond 6.2 MHz, but the worst is yet to come. The spotlight could soon shift to Dayanidhi Maran and A Raja, since it was during the stewardship of these two UPA ministers that the bulk of spectrum three to four times more than during the NDA rule was allocated.

In fact, Maran, who took over as telecom minister in May 2004, enjoys the dubious distinction of allocating maximum spectrum beyond 6.2 MHz based on the subscriber-linked criterion framed by the NDA.

Documents from the Shivraj Patil committee report show that while the NDA government decided to allocate additional spectrum beyond 6.2 MHz on February 1, 2002, through a notification, little was allocated between March 2002 and May 2004, when the government went out of power.

The reason is simple: Todays leading telcos holding spectrum beyond 6.2 MHz like Bharti, Vodafone (then Hutch), Idea, MTNL and BSNL were fledgling operators in 2003-04, and did not require any additional spectrum.

Documents show Bharti won eight circles and Vodafone (then Hutch) three in the 2001 auctions. None of these circles qualified for additional spectrum in the NDA regime since by 2002-03 they had barely launched their services. Similarly, Idea had won one circle during the 2001 auctions and acquired four circles from Escorts (Escotel) through an acquisition which Escorts had won in the 2001 bidding.

Therefore, it didnt qualify for much additional spectrum either before 2004. Nine of Ideas remaining circles got start-up spectrum after 2008. Similarly, Aircel received start-up spectrum for 14 of its 22 pan-India circles in 2008. Even Vodafone received start-up spectrum in seven of its pan-India circles in 2008.

State-owned BSNL, the largest holder of spectrum beyond 6.2 Mhz, started mobile operations in 2001-02, and given its slow pace of subscriber addition, did not make a single claim for spectrum beyond 6.2 Mhz during the NDA regime, show data from Department of Telecommunications.

Since the maximum chunk of excess spectrum allocation which according to the CAG report caused a loss of Rs 36,993 crore happened when Maran and Raja ran the telecom ministry in UPA-I and UPA-II (June 2004 till date), both could soon face trouble.

The UPA has argued that it avoided auctions to follow the first-come-first-served (FCFS) policy based on an NDA Cabinet decision of October 31, 2003. However, in the case of spectrum allocation beyond 6.2 MHz, according to the Patil report, there was no such NDA Cabinet decision which bound the UPA from revising the subscriber-linked criterion when it came to power in May 2004.

According to the Patil report, it was a purely executive decision. Data further show that the primary circles in which the NDA allocated spectrum beyond 6.2 MHz include the two metro circles of Delhi and Mumbai and a handful of A Category circles.