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2G spectrum scam

From Wikipedia, the free encyclopedia

The 2G spectrum scam involved officials and ministers in the Government of India illegally undercharging mobile telephony companies for frequency allocation licenses, which they would use to create 2G subscriptions for cell phones. According to a report submitted by the Comptroller and Auditor General based on money collected from 3G licenses, the loss to the exchequer was 176,379 crore (US$38.27

billion). The issuing of the 2G licenses occurred in 2008, but the scam came to public notice when the Indian Income Tax Department investigated political lobbyist Niira Radia and the Supreme Court of India took Subramaniam Swamy's complaints on record [With Case type:Writ Petition (Civil),Case No:10, Year:2011]. (Civil),Case No:423, Year:2010.
[2] [1]

The case details of the main PIL filed with the supreme court is Type:Writ Petition

In 2008, the Income Tax department, after orders from the ministry of Home and the PMO, began tapping the phones of Niira Radia. This was done to help with an ongoing investigation into a case where it was alleged that Niira Radia had acted as a spy.

Some of the many conversations recorded over 300 days were leaked to the media. The intense controversy around the leaked tapes, became known in the media as the Radia tapes controversy. The tapes featured some explosive conversations between Politicians, Journalists and Corporate Houses. Politicians from Karunanidhi to Arun Jaitley
[citation needed]

, journalists like Barkha Dutt and Vir Sanghvi and Industrial groups

like the Tata's were either participants or mentioned in these explosive tapes.

Parties involved
The selling of the licenses brought attention to four groups of entities - politicians who had the authority to sell licenses, bureaucrats who implemented and influenced policy decisions, corporations who were buying the licenses, and media professionals who mediated between the politicians and the corporations on behalf of one or the other interest group. [edit]Politicians


A. Raja, the Ex-Minister of Communications and Information Technology who was the minister when the controversial second round of spectrum allocations took place. Mr.Raja, an MP of the Dravida Munnetra Kazhagam from the Nilgiris constituency, was forced to resign following the public outcry.

Arun Shourie, the minister for Telecom during 2003 in the previous BJP regime. It was Arun Shourie who introduced the controversial technology neutral "Unified Access(both Basic & Celluler) Services License", which allowed fixed line operators who had paid much lower license fees to offer mobile phone services, at first in the limited WLL mode (Wireless local loop) and later, following an out of court settlement between mobile operators and the BJP govt, full mobility. This gave an advantage to players like Reliance and Tata Teleservices who managed to get mobile spectrum without paying the hefty fees that earlier operators like BPL Mobile had paid.

Pramod Mahajan, the minister for Telecom between 1999 and 2003. Mr.Mahajan was the minister when the BJP Government took the controversial decision to shift from a license fee based regime to a revenue sharing model which was roundly condemned both by political parties and by economic experts.

The Comptroller and Auditor General also filed adverse reports citing a loss of over

64,000 crore (US$13.89 billion) caused by this decision. The crux of A. Raja's defence is that he was

following a policy of 2G allocations put in place by the BJP and it would be unfair to levy prices based on 3G spectrum to 2G licenses. Pramod Mahajan, who was seen to be friendly with various corporate houses, had been brought in to replace Jagmohan as Telecom minister just days before the decision was announced. The biggest beneficiary of this abrupt shift in policy was Reliance Infocomm who gained thousands of crores of spectrum without paying a dime in additional license fees. Pramod Mahajan and his friends and relatives are reported to have received benami shares of Reliance Industries as a "gift" [edit]Bureaucrats


Siddhartha Behura, former telecom secretary who served in the DOT at the time of the 2G allocation. Pradip Baijal, a bureaucrat who is alleged to have implemented policies that favored certain Telecom companies when he was heading the TRAI. Post retirement, Baijal joined Noesis, a consulting firm.


has made references to Baijal's decisions in 2003 as the basis for his decisions in 2008. The houses and offices of the bureaucrat were recently investigations.
[8] [when?]

raided by the Central Bureau of Investigation as part of their

R K Chandolia, private secretary of Raja during UPA-I when the licences were awarded. He was an Indian Economic Service officer of the 1984 batch cadre.When Raja became the Telecom Minister once again in UPA-II, Chandolia had been promoted to the Joint Secretary rank. Raja re-designated him Economic Adviser, that gave him the charge of all important policy-related work. Chandolia interacted with all the licensees. It is said that it was Chandolia who, from DDG-access services A K Srivastava's room, had handed out letters of intent to representatives of various companies.

The above mentioned all are involved with the case. [edit]Corporations


Unitech Group a real estate company entering the telecom industry with its 2G bid; sold 60% of its company stake at huge profit to Telenor after buying licensing (Including land values properties for towers)

Swan Telecom sold 45% of its company stake at huge profit to Emirates Telecommunications Corporation (Etisalat) after buying licensing


Loop Mobile Videocon Telecommunications Limited S Tel Reliance Communications Sistema Shyam Mobile (MTS) Sistema Mobile Russia Tata Communications Vodafone Essar Dishnet Wireless Allianz Infra

persons and lobbyists involved

Nira Radia, a former airline entrepreneur turned corporate lobbyist whose conversations with politicians and corporate entities were recorded by the government authorities and leaked creating the Nira Radia tapes controversy

Barkha Dutt, an NDTV journalist alleged to have lobbied for A. Raja's appointment as minister Vir Sanghvi, a Hindustan Times editor alleged to have edited articles to reduce blame in the Nira Radia tapes.


Subramaniam Swamy, activist lawyer and politician, whose letters to the Prime Minister demanding action and affidavits and cases in the Supreme Court brought the issue into the public limelight.

Paranjoy Guha Thakurta, a journalist who was one among the very first to write on the irregularities in the awarding of 2G spectrum allocation by the Telecom Ministry. He is also one of the petitioners in the 2G PIL currently being heard in the Supreme court.

Prashant Bhushan, on behalf of the Centre for Public Interest Litigation. Anil Kumar, on behalf of the civil society organisationTelecom Watchdog Others:Several eminent people like former chief election commissioners J.M. Lyngdoh, T.S. Krishnamurthy and N. Gopalaswami and former central vigilance commissioner (CVC) P. Shankar are also petitioners in the suits filed by civil society groups.


of money

A. Raja arranged the sale of the 2G spectrum licenses below their market value. Swan Telecom, a new company with few assets, bought a license for 1,537 crore (US$333.53 million).

Shortly thereafter, the board sold 45% of the company to Etisalat for

4,200 crore (US$911.4

million). Similarly, a company formerly invested in real estate and not telecom, the Unitech Group, purchased a license for 1,661 crore (US$360.44 million) and the company board soon after sold a 60% stake in their wireless division for billion) to Telenor.

6,200 crore (US$1.35

The nature of the selling of the licenses was that licenses were to be sold at market value, and the fact that the licenses

were quickly resold at a huge profit indicates that the selling agents issued the licenses below market value. Nine companies purchased licenses and collectively they paid the Ministry of Communications and Information Technology's telecommunications division Auditor General of India was [edit]Relationship 10,772 crore (US$2.34 billion).

The amount of money expected for this licensing by the Comptroller and

176,700 crore (US$38.34 billion).

between media and government

Main article: Nira Radia tapes controversy Media sources such as OPEN and Outlook reported that Barkha Dutt and Vir Sanghvi knew that corporate lobbyist Nira Radia was influencing the decisions of A. Raja.

The critics alleged that Dutt and Sanghvi knew about corruption between the government and the media industry,

supported this corrupt activity, and suppressed news reporting the discovery of the corruption. [edit]Ratan

Tata petitions over leak

The tapes leaked to the public include conversations between Nira Radia and Ratan Tata. Tata petitioned the government to acknowledge his right to privacy and demanded accountability for the leak, with the Minister for Home Affairs, CBI, Indian Income Tax Department, the Department of Telecommunication, and the Department of Information Technology as respondents in the petition.


to scam

In early November 2010 Jayalalithaa accused the Tamil Nadu state chief minister M Karunanidhi of protecting A. Raja from corruption charges and called for A. Raja's resignation.

By mid November A. Raja resigned.


In mid November the comptroller Vinod Rai issued show-cause notices to Unitech, S Tel, Loop Mobile, Datacom (Videocon), and Etisalat to respond to his assertion that all of the 85 licenses granted to these companies did not have the up-front capital required at the time of the application and were in other ways illegal.

Some media sources have speculated that these companies will receive large fines but not have

their licenses revoked, as they are currently providing some consumer service.

In response to the various allegations , the Govt of India has replaced the then incumbent Telecom minister ,A Raja with Kapil Sibal who has taken up this charge in addition to being the Union minister for Human Resources Development.Mr Sibal contends that the "notional" losses quoted are a result of erroneous calculations and insists that the actual losses are nil.

The CBI conducted raids on Raja and four other telecom officials - former telecom secretary Siddharth Behura, Raja's personal secretary R K Chandolia, member telecom K Sridhar and DoT deputy director general A K Srivastava on 8 December 2010. Raja, Behura and Chandolia were arrested on Feb 2nd 2011. [edit]Impact
[23] [22]

on stock markets

The first casualty in Stock Markets once Raja was arrested was DB Realty.

DB Realty had given 200+ crores to Kalaignar TV( owned by

Karunanidhi's Wife) . The news led to 20% fall in the stock prices of DB Realty. Sun TV had its shares fall by 10% on the next day following rumours of Kalanidhi Maran having stake in Kalaignar TV. Feb 8
[26] [25]

Sun TV COO refused the allegations. Swan Telecom Chief Balwa was arrested on

and this led to rumours of links with Anil Ambani's Reliance ADAG and it led to 20% fall of his stocks . Its reported that nearly 2 Billion

USD was eroded from his stocks .

Spicejet stocks went down after reports of investigation on Maran's recent takeover of Spicejet .


A. Raja
From Wikipedia, the free encyclopedia

In this Indian name, the name "Andimuthu" is a patronymic, not a family name, and the person should be referred to by the given name, "Raja".

Andimuthu Raja

Union Cabinet Minister for Communications and Information Technology

In office 20072010 Prime Minister Preceded by Succeeded by Constituency Manmohan Singh Dayanidhi Maran Kapil Sibal Nilgiris


10 May 1963 (age 47) Perambalur, Tamil Nadu,India DMK M.A. Parameswari Mayuri Raja Perambalur Lawyer Politician Hindu

Political party Spouse(s) Children Residence Profession

As of September 22, 2006 Source: [1]

A. Raja (Tamil: . ) ( ) (born May 10, 1963, Perambalur, Tamil Nadu, India) is an Indian politician from theDravida Munnetra Kazhagam(DMK) political party. He is a member of the 15th Lok Sabha representing the Nilgiris constituency of Tamil Nadu. Raja was first elected to the Lok Sabha in 1996 and first served as minister of state from 1999 to 2003. On being re-elected to the Lok Sabha in 2004, he became a cabinet minister in the UPA government. In 2007, he became cabinet minister for communication and information technology. On being re-elected in 2009 he was again appointed cabinet minister for communication and information technology until being tainted in the 2G spectrum scam and resigning in 2010.

1 Resignations 2 Spectrum Scandal 3 References 4 External links

[edit]Resignations On October 17, 2008 he submitted his post-dated resignation to the D.M.K party chief M. Karunanidhi over the killings of Tamil civilians in Sri Lanka.

His resignation was a part of the mass resignation of all the D.M.K ministers forming a part of the coalition UPA central government.

On November 14, 2010, he announced that he would step down [edit]Spectrum

from his cabinet post, over the 2G spectrum allocation scandal.


Main article: 2G spectrum scam Further information: Nira Radia tapes controversy The 2G spectrum financial scandal in the Telecommunications and IT Ministry under A.Raja is noteworthy as the largest political corruption case in modern Indian history, amounting to a record $40 billion loss from underpricing to the Government of India.
[citation needed]


allegedmodus operandi was telecom bandwidth being grossly undervalued and offered to a chosen few with vested interests, on a dubious 'First-Come-First-Served' basis. It is alleged that it should have been put under a transparent auction system, purportedly advised by higher office. The bandwidth-spectrum allocation of 2G bandwidth had later come under criticism for gross irregularities. An FIR filed by the CBI claims that the allocation was not done as per market prices, resulting in a scam worth 200 crore (US$43.4 million).

However it had been alleged

by Arun Jaitley of Bhartiya Janata Party that the scam is worth around

176,000 crore (US$38.19 billion). The Comptroller and Auditor General

holds Raja personally responsible for the sale of 2G spectrum at 2001 rates in 2008, resulting the previously mentioned loss of up to Rs. 1.76 lakh crores (US$40 billion) to the national exchequer.

In August, 2010, evidence was submitted by the Comptroller and Auditor General

(CAG) showing that Raja had personally signed and approved the majority of the questionable allocations.

Although the political opposition

was demanding his resignation over the 2G spectrum scam, Raja initially refused to resign stating his innocence, and this view was backed by his party president M.Karunanidhi.

The financial scam eventually led to Raja's resignation


on the 14th of November, 2010. There will be further criminal investigation and action

on Raja with reports being filed by the Comptroller and Auditor General (CAG) and the Central Bureau of Investigation (CBI). In 2011, the results of an investigation by retired judge Shivraj Patil, who was appointed by current telecom minister Kapil Sibal, has also found Raja to have been directly responsible for "procedural lapses" regarding the spectrum scandal. estimate that Raja made as much as 3,000 crore.
[9] [8]

The The CBI and Enforcement Directorate

Raja and two former associates were arrested on February 2, 2011. The 3 have been taken to Patiala House Courts for enquiries by the CBI on 3 February 2011

He was backed by his party DMK after his arrest and in general meeting in Chennai party passed a resolution in favor of

Raja stating that until charges are proven he is not guilty.

What exactly happened in 2G scam?

In: Uncategorized [Edit categories]

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2G licenses issued to private telecom players at throwaway prices in 2008 CAG: Spectrum scam has cost the government Rs. 1.76 lakh crore CAG: Rules and procedures flouted while issuing licenses


Entry fee for spectrum licenses in 2008 pegged at 2001 prices Mobile subscriber base had shot up to 350 million in 2008 from 4 million in 2001


Rules changed after the game had begun Cut-off date for applications advanced by a week Licenses issued on a first-come-first-served basis No proper auction process followed, no bids invited Raja ignored advice of TRAI, Law Ministry, Finance Ministry TRAI had recommended auctioning of spectrum at market rates


Unitech, Swan Telecom got licenses without any prior telecom experience

Swan Telecom given license even though it did not meet eligibility criteria Swan got license for Rs. 1537 crore, sold 45% stake to Etisalat for Rs. 4200 crore Unitech Wireless got license for Rs. 1661 crore, sold 60% stake for Rs. 6200 crore All nine companies paid DoT only Rs. 10,772 crore for 2G licences


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Dravida Munnetra Kazhagam

From Wikipedia, the free encyclopedia

"DMK" redirects here. For other uses, see DMK (disambiguation).

Dravida Munnetra Kazhagam


M Karunanidhi


K Anbazhagan

Leader in Lok Sabha

T. R. Baalu[1]




Anna Arivalayam, Anna Salai,Chennai 600018


Murasoli & The Rising Sun

Labour wing

Labour Progressive Federation


Social Democratic/Populist


National Democratic Alliance(19992004) United Progressive Alliance(2004present)


Party flag

Politics of India Political parties Elections

Dravida Munnetra Kazhagam (Tamil: ) (literally "Dravidian Progress Federation"


) (founded

1949, Madras Presidency, India) is a state political party in the states of Tamil Nadu and Puducherry , India. It is a Dravidian partyfounded by C. N. Annadurai as a breakaway faction from the Dravidar Kazhagam (known as Justice Party till 1944) headed by Periyar. Since 1969, DMK is headed by M Karunanidhi, the current Chief Minister of Tamil Nadu. DMK holds the distinction of being the first party other than the Indian National Congress to win state-level elections with clear majority on its own in any state in India.

1 History

1.1 Justice Party

o o o o o

1.2 Dravida Kazhagam 1.3 Dravida Munnetra Kazhagam 1.4 MGR's entry 1.5 1960s 1.6 Karunanidhi's presidency

1.6.1 MGR's exit 1.6.2 Post-MGR

2 Party Symbol 3 Election history

o o o

3.1 Madras State 3.2 Tamil Nadu 3.3 Puducherry

4 See also 5 References 6 External links

[edit]History [edit]Justice


DMK traces its roots to the South Indian Liberal Federation (Justice Party) formed in 1916, by P. Thiyagarayar, Dr. P.T. Rajan, Dr. Natesanar and few others. The Justice Party, whose objectives included social equality and justice, came to power in the first General Elections to Madras Presidency in 1920.

E. V. Ramasami Naicker, a popular Tamil leader of the time, who had joined Indian National Congress in 1919,

to oppose what he considered as the Brahminic leadership of the party.

Naicker's experience at the Vaikom Satyagraha made him to start


the Self-Respect Movement in 1926 which was rationalistic and "violently anti-Brahminic".

He quit Congress and in 1935, he joined the Justice

Party. In the 1937 elections, the Justice Party lost and the Indian National Congress underC. Rajagopalachari ("Rajaji") came to power in Madras Presidency. Rajaji's introduction of Hindi as a compulsory subject in schools led to the anti-Hindi agitations, led by Periyar and his associates. [edit]Dravida


In August 1944, Periyar created the 'Dravida Kazhagham' out of the Justice Party and the Self-Respect Movement at the Salem Provincial Conference.

Dravidar Kazhagam insisted on an independent nation for Dravidians called Dravida Nadu consisting of areas that were covered

under Madras Presidency. [edit]Dravida

Munnetra Kazhagam

Over the years, many disputes arose between Periyar and his followers. In 1949, several of his followers led by C. N. Annadurai, decided to split from Dravidar Kazhagham, after an aged Periyar married a young woman Maniammai and anointed his young wife to act as his successor to lead the party, superseding senior party leaders. Until then E. V. K. Sampath, the nephew of Periyar, was considered as his political heir. Annadurai, on 17 September 1949 along with V. R. Nedunchezhiyan, K.A. Mathiazhagan, K. Anbazhagan, N.V. Natarajan, E. V. K. Sampath and thousands of others in Robinson park inRoyapuram in Chennai announced the formation of the DMK. [edit]MGR's


M. G. Ramachandran, K. A. Mathialagan, C. N. Annadurai, Rajaji andM. Karunanidhi

MGR was a member of the DMK, and he was seen as an icon of the DMK and spread its message through films like Anbe Vaa. In 1953, MGR joined the DMK, popularised the party flag and symbol which at that time stood for secession from India by showing it in his movies. DMK entered the electoral fray rather unsuccessfully in 1957 with even senior leader V. R. Nedunchezhiyan losing from Salem although M Karunanidhi won after initially having opposed all Indian government and later supporting only those parties which promised to help its secession from India cause. [edit]1960s

DMK leaders K. A. Mathialagan, V. P. Raman, C. N. Annadurai and M. Karunanidhi with Rajaji

Annadurai wanted a separate Dravida Nadu but the DMK changed its stance with the Chinese invasion in 1962 and suspended its demand for the length of the war and supported India raising funds for the war. When the war ended, nationalistic feelings were so strong that DMK gave up the separate Dravida nation idea. The Anti-Hindi agitations of 1965 forced the central government to abandon its efforts to impose Hindi as the only official language of the country; still Hindi imposition continued as Indian government employees are asked to write as much as 65% of the letters and memoranda in Hindi. In 1967, DMK came to power in Madras province 18 years after its formation and 10 years after it had first entered electoral politics. This began the Dravidian era in Madras province which later became Tamil Nadu. In 1969, party general secretary and founder, CN Annadurai died. After his death, there was a power tussle between M Karunanidhi and Nendunchezhiyan and the post of party president was created as a compromise with Karunanidhi becoming the president and Nendunchediyan becoming general secretary . [edit]Karunanidhi's


[edit]MGR's exit M. G. Ramachandran (MGR) who was a popular actor and the then party treasurer had played a vital part in popularizing the party's ideologies. The political feud between MGR and the party president Karunanidhi emerged as an aftermath of the latter calling himself "Mujib of Tamil Nadu". In 1972, MGR called for a boycott of the party's General Council. With the crisis falling into call for corruption probe by MGR, he was eventually suspended from the General Council. Thus emerged a new party All India Anna Dravida Munnetra Kazhagam (AIADMK). [edit]Post-MGR In April 1974, the DMK government brought in a resolution in the House urging the Centre to accept the Rajamannar Committee recommendations on state autonomy and amend the Constitution of India to pave the way for a true federal system. After MGR's death in December 1987, AIADMK split into two factions between Janaki (MGR's wife) and Jayalalithaa. DMK returned to power in 1989 State assembly elections. Karunanidhi took over as chief minister in January 1989. Subsequent to this, the LTTE "sent personal emissaries to Karunanidhi for seeking his active support in their battle against theIPKF".
[10] [9]

Then in 1991 elections are arranged to be held for both State and Central government. In 21 May 1991 Rajiv Gandhi was assassinated in Sriperumbudur, near Chennai in a election campaign meeting. It was later found the he has been killed by suicide bomber from LTTE, citing IPKF atrocities

in Srilanka as a reason.

This lead to sympathy wave favor of AIADMK Congress alliance and DMK is deprived of any seats in the Parliament. This brings the rise of political rival J.Jayalalithaa to the DMK. In 1996 election DMK came to power and M Karunanidhi form the government in the State. In 2004 parliamentary elections, DMK formed a alliance with Congress Pattali Makkal Katchi(PMK) and swept a grand Victory, the alliance won all 40 seats including Puducherry. This enable 7 ministerial post in the Central government and influential power to DMK. Two years later 2006 same alliance won in the state assembly election and DMK formed the government in the state. Mr. M Karunanidhi become fifth time the Chief Minister of the State. [edit]Party


The party's election symbol is the sun arising from between two mountains, called the Rising Sun. [edit]Election


See pdf for summary. DMK's worst poll performance ever in this state was registered in 1962 and its peak in 1996. [edit]Madras


Year General Election Votes Polled Seats Won

1962 3rd Assembly



1962 3rd Lok Sabha


1967 4th Assembly



1967 4th Lok Sabha



[edit]Tamil Year

Votes Polled Seats Won Alliance(s)


1971 5th Assembly




1977 6th Assembly




1980 7th Assembly




1984 8th Assembly




1989 9th Assembly




1991 10th Assembly 5,535,668


1996 11th Assembly 11,423,380



2001 12th Assembly 8,669,864



2006 13th Assembly 8,728,716



Year General Election Votes Polled Seats Won


1971 5th Lok Sabha




1977 6th Lok Sabha



1980 7th Lok Sabha




1984 8th Lok Sabha



1989 9th Lok Sabha



1991 10th Lok Sabha



1996 11th Lok Sabha




1998 12th Lok Sabha



1999 13th Lok Sabha




2004 14th Lok Sabha




2009 15th Lok Sabha




[edit]Puducherry Year Election Votes Polled Seats Won

1974 3rd Assembly


1977 4th Assembly


1980 5th Assembly



1985 6th Assembly


1990 7th Assembly


1991 8th Assembly


1996 9th Assembly


2001 10th Assembly 83,679

2006 11th Assembly

Year General Election Votes Polled Seats Won

1984 8th Lok Sabha


1989 9th Lok Sabha


1991 10th Lok Sabha


1996 11th Lok Sabha


1998 12th Lok Sabha