The Urdu poet Bashir Badr once wrote, “Dil ki duniya purani dilli hai, jo bhi guzra hai usne loota hai.” (Loosely translated which means that the heart’s world is like Old Delhi, whoever has passed through has looted it).
The politicians who run the current United Progressive Alliance (UPA) operate out of New Delhi, and like the chieftains of yore who robbed Old Delhi, they continue to rob New Delhi and, in the process, India.
One such robber politician is A Raja who sold 122 telecom licences at Rs 9,200 crore in 2008, a price significantly lower than the price the government could have got if it had auctioned the licenses. The Comptroller and Auditor General(CAG) made four estimates of the losses on account of this. These losses worked out to Rs 57,666 crore, Rs 67,364 crore, Rs 69,626 crore and Rs 1,76,645 crore.
As is its wont in such cases, the media ran with the highest figure and put the losses on account of the shenanigans of Raja at Rs 1,76,000 crore. But even a loss of Rs 57,666 crore was no small number.
The Supreme Court cancelled these licences. The government recently tried to auction these licences again. Its aim was to raise Rs 40,000 crore from these auctions. It managed to raise only Rs 9,407 crore. (Or Rs 17,343 crore, if you include the one-time fee for spectrum already held by incumbents).
This prompted Manish Tewari, the newly-appointed Minister for Information and Broadcasting, to ask, “Mr CAG, where is the Rs 1.76 lakh crore?” The same applies to Finance Minister P Chidambaram, who has been making similar noises on Coalgate - even though he should know better.
Tewari went on to add that “I think it is time for some serious introspection. It’s time CAG introspects on his processes and it is high time that the BJP and some of the other opposition parties, which had made this their holy-grail and swansong of politics over the last two years, should publicly apologise.”
The comment is along the lines of Kapil Sibal’s famous zero-loss theory on CAG’s estimates of the losses to the government on account of Raja’s misadventures. “The logic underlying this estimate is completely flawed. Government policy is formulated with a view to maximising public welfare, and not merely to maximise government revenues. The pricing of different natural resources is often done in a manner that meets this objective,” Sibal had said while justifying the decision of the government to sell telecom licences in 2008 at the same price as it had sold in 2001. “No loss at all. Zero is the loss…It (the calculation made by CAG) has embarrassed the government, it has embarrassed the nation,” Sibal declared.
But how does the government explain that Unitech, a company which got the licence in 2008, went around and sold 60 percent of its stake to Telenor for Rs 6,120 crore even before it had constructed a single tower to launch a mobile phone service. It had paid only Rs 1,651 crore for the telecom licences. Shouldn’t this money have realistically flown into government coffers?
So what can safely be said was that Sibal was essentially trying to complicate the issue in order to confuse the nation. As a recent profile on Sibal in The Caravan magazine puts it, “There was a method to Sibal’s madness. This was his opening statement before the court of public opinion, and he had unquestionably taken the strongest possible line in his client’s defence. That few seemed to believe him was beside the point. His audacity had muddied the waters just enough to introduce doubts in what had looked like an open-and-shut case, demonstrating that a sufficiently strenuous and elaborate defence of the indefensible could perhaps make it defensible after all.”
Manish Tewari is working along similar lines and trying to complicate the issue, or as The Caravan puts it in Sibal’s case, “muddy the water just enough”.
We need to understand a few things here to basically look through Tewari’s statement. CAG used various methods to arrive at the loss estimates that it did. For the estimate of Rs 1,76,645 crore, CAG used the prices that companies paid when the 3G licences were auctioned in 2010. The logic being that if the telecom licences had been auctioned in 2008 and companies had paid the same prices that they did for 3G licences in 2010, the government could have made Rs 1,76,645 crore more than it actually did.
Similarly, other ways were used to arrive at other loss estimates. Another loss estimate of Rs 69,626 crore was based on the price at which Unitech sold 60 percent of the stake in its telecom business to Telenor immediately after getting the licence in 2008.
So, yes, there was a loss to the government and the nation when Raja sold off 122 telecom licences for Rs 9,200 crore. There is no beating that irrespective of what Tewari now and Sibal earlier had to say.
Let’s come back to the recent telecom auction and the inability of the government to raise much money from it, something that prompted Tewari to ask “Mr CAG, where is the Rs 1.76 lakh crore?”
Just because the government couldn’t raise as much as it was expecting to from this auction does not mean that the way the government went around selling telecom licences in 2008 was correct. Second, much has changed between 2008 and 2012. The finances of the Indian government are in a mess. Inflation and interest rates are high. And economic growth is stagnating.
Hence, telecom companies are no longer in the mood to pay the high prices that they did for 3G spectrum in 2010. Also, if the government raised the kind of money that it did with the 3G auction in 2010, imagine the kind of money it could have raised had it decided to auction telecom licences in 2008, when the financial crisis had not yet broken out, instead of giving them away on a first-come-first-served basis, and that too through a arbitrary process.
But Tewari is working along expected lines. He is a lawyer by qualification who was expected to muddy up things as a spokesperson for the Congress party. And he is working along similar lines after taking over as the minister for information and broadcasting, a post from which he can hope to effectively control opinion.
As Noam Chomsky, the world’s foremost living intellectual, points out in How the World Works: “Ultimately, the governors, the rulers, can only rule if they control opinion…This is true of the most despotic societies and the most free… If the general population won’t accept things, the rulers are finished.”
In this day and age of the internet, where it is very difficult to totally control opinion that is going around, the best a ruler can do is muddy the opinion and that is what Tewari is trying to do in this case.
Also, having been in the party for too long, Tewari has now tasted real power and is trying to do a Sibal. The Caravan, in its recent profile of Sibal, wrote, “Among the country’s chattering classes, his innumerable television appearances and indefatigable zeal for defending the indefensible have made him a favourite target for mockery and derision—in which he typically appears as a caricature combining the worst qualities of lawyers, politicians and out-of-touch elites. But Sibal is well aware that his prominence within the party depends on these over-the-top performances, and it could be argued that no other politician has taken better advantage of the present age of around-the-clock television shoutfests and exaggerated sound-bites.”
This could have easily been written for Tewari as well.
Vivek Kaul is a writer. He can be reached at firstname.lastname@example.org
Published Date: Nov 19, 2012 01:37 pm | Updated Date: Nov 19, 2012 01:37 pm