Should scarce resources, like 2G spectrum or minerals, be given to the highest bidder?
The Supreme Court had said ‘yes’ in its famous February 2012 judgement on 2G spectrum and had advocated that a method of ‘auction’ for all scarce natural resources will be better and thus directed the government to cancel all the 2G spectrum given on first-cum-first basis and put them to auction in a prescribed manner.
On the face of it, the government is appearing to have formulated new rules for auctioning the 2G spectrum. The Manmohan Singh-led government has, however, submitted its arguments through a Presidential reference and has opposed ‘auction’ system alone as the method for disposal of natural resources and argued that the ‘common good’ as enshrined in the Indian Constitution should determine allocation of natural resources.
The government, in its reply submitted in early June 2012, also argues by citing several court judgments that the Supreme Court “cannot interfere with policy decision only on the ground that another policy decision would be better”.
Soon after the SC judgement on 2G spectrum on 2 February 2012, the government had first filed a review petition against the judgement and then withdrew the same in haste.
Yet again, the Manmohan Singh-led government has sought a review or appeal against the SC’s 2G judgement by making a presidential reference. The government’s response, a copy of which is with the Firstpost, clearly states that the government doesn’t agree that the ‘auction’ alone should be the guiding principle in disposal or distribution of natural or mineral sources.
The government even supported its ‘first-come, first-served method’ as adopted in the 2G spectrum case on grounds that several other developed and developing nations follow the same method in distribution of mining resources.
Prashant Bhushan had earlier filed a petition and raised a pertinent question that in the light of the Supreme Court judgement on 2G scam, the government should be directed to adopt ‘auction’ policy for all the scarce natural sources, which are distributed or disposed for commercial exploitation.
“The government has indulged in forum shopping by first filing a review petition against the 2 G judgement and then by withdrawing the same even after notice had been issued on the said review petition. This presidential reference is not maintainable because it clearly and squarely seeks a review/appeal against the SC judgement,” Prashant Bhushan says.
The government’s ‘written’ reply strangely mixes up scarce resources with all the natural resources, like fisheries and water lakes and argues that “a simplistic method of ‘auction’ cannot be applied for disposal of all types of natural resources. Such a simplistic method of auction of natural resources in all circumstances and in all sectors, apart from being impractical in certain situations, can also be counter-productive and can impact the growth and economy of the country.”
And to support this, the government reply says: “The concept of auction by its very nature cannot be made applicable to natural resources such as fisheries.” The government’s argument has completely undermined the pertinent question whether ‘auction’ method be adopted for distribution of scarce resources like coal, oil and spectrum.