This is a mega telecom scam, cries CPM

The CPM on Friday accused Communication Minister A Raja of misleading the Parliament on the issuance of new telecom licences at throw away prices that allegedly cost the exchequer a whopping Rs 1,00,000 crores and demanded that the Prime Minister Manmohan Singh look into it.

"This is a mega telecom scam. New telecom licences have been given on first-come, first-serve basis at the prices fixed in 2001. The market value of these licences is roughly seven times higher now," CPM Polit Bureau member Sitaram Yechury told reporters in New Delhi.

The existing mobile operators under the umbrella of Cellular Operators Association of India (COAI) had also opposed the decision of issuing new licences at a fixed price of Rs 1,651 crore for pan-India coverage.

Raja had defended the decision, saying that as late as in March 2007, just two months before he took charge from his predecessor Dayanidhi Maran, new licences were given to existing players at the same price.

Yechury said the government should have adopted a policy of open auction to arrive at market-determined price for issuing new licences and spectrum.

Asked whether CPM has joined hands with the COAI for opposing the new policy, the party's leader Nilotpal Basu denied this and said that they were also demanding an enquiry into allocation of additional spectrum to existing players beyond their eligibility.

Raja, in reply to a question in Parliament, had claimed that neither the Central Vigilance Commission (CVC) nor the telecom regulator TRAI had raised any objection to the allocation of spectrum to 2G telecom service providers on a first-come, first-serve basis.

"This is nothing but an attempt to mislead Parliament, obfuscate matters and conceal the truth," Yechury said.

Yechury said that in a letter dated November 15, the CVC had expressed dissatisfaction over an earlier response of the DoT to the Commission's queries on the policy for allocation of spectrum. The CVC had asked for specific issues including clarification with regard to Swan Telecom selling their equity at high value.

As far as TRAI is concerned, it had said that the DoT violated the recommendations of the regulator while allocating new licences to 2G telecom operators.

The CPM has demanded immediate action on the part of the Prime Minister in this regard.

"Failure to initiate probe into the matter and fix responsibility, undertake steps to retrieve the lost revenues and review the entire gamut of spectrum allocation policies would make the entire Cabinet complicit with this gigantic scam," he said.