Business Ethics

Presented By Pankaj Dharmik (57) Manish Enichilwar (58) Nilesh Ghadge (59) Chandan Jagtap (63) Pratik Tambe ()

2 G Scam

Content
About 2G. What is 2G spectrum scam? Who are Involved? Media Response. Market Response. Steps Taken by Govt. Political Response to Scam. Unethical Practices Conclusion

2G

????????

Second-Generation Wireless Telephone Technology

Benefit of 2G

Digital coding improves the voice clarity and reduces noise in the line. Introduction of short message Digital encryption has provided secrecy and safety to the data and voice calls

What is spectrum?

What is its relation with mobile phone services?

What is the 2G spectrum ?

Spectrum as a scarce national resource

Telecom Operation in India

Who is that Person?

One of the main person behind the Indias Largest Corporate Fraud.

A. Raja (Born May 10, 1963, Perambalur, Tamil Nadu, India) is an Indian politician from the Dravida 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.

What are the charges on former minister A. Raja ?

Cheap Telecom License No Procedure Followed Rules changed after the game had begun. Cut-off date for applications advanced by a week. Licenses issued on a first-come-firstserved 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 licenses.

Shyam Telecom: Sold 74% to Sistema of Russia (MTS brand) Unitech: Sold 67% to Telenor of Norway (Uninor brand)

Swan Telecom: Sold DB Group about 45% to Etisalat, UAE (Cheers brand) and 5% to Genex, Chennai
Tata Teleservice: Sold 26% to NTT of Japan (DoCoMo brand)

People involved in 2G Spectrum

Politician Involved
A. Raja Mahajan Pramod Arun Shourie Ex-Minister of Communications 2003 Minister of Telecome in 1999Minister of Telecom During 2003 and Information Technology

Corporate Personalities involved

AnilVinod Goenka Group (ADAG) Ambani Dhoot- Videocon Group Prashant Ruia - Essar Group Shahid Balwa - DB Realty and DB Etisalat (Swan Venugopal - Reliance

Dynamix Group

All of them have either been question by the CBI or are prospective suspects in the scam.

Media Persons & Lobbyist Involved

Nira Radia , Vir Sanghvi
a Hindustan Times editor

Barkha Dutt NDTV journalist

Impact on share market

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. Sun TV COO refused the allegations. Swan Telecom Chief Balwa was arrested on Feb 8 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

Corporations involved
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

2 G Scam

Steps taken by Government after Scam

Set up a special branch of CBI to look into the matter. Telecom Minister resigns his post after Scam. A Raja also arrested by the CBI. CBI also arrested Mr Siddharatha Behura (Secretary-DoT), and Mr RK Chandolia (PS to Mr Raja) r A Raja,