The Great 2G Auction Cheat Show

The Politicians & the Businessmen have again managed to fool the public. The 2G spectrum auction and the subsequent talks about how CAG was wrong to say Govt. had a loss in the earlier allotment of 2G spectrum is just proving that Politicians & Businessmen are doing what they do the best – fool & loot the public & the nation.

The auction did not generate the ‘real’ amount that it should have because –
1) in 2008 the demand for spectrum was much higher, today the demand is lower given the realisation of lower growth potential and revenue from mobile networks. Everybody has seen the drop in growth of mobile subscribers which they did not anticipate in 2008.  This has resulted in fewer new players actually bidding for the spectrum. With an economy in a less attractive state companies did not bid as high as in 2008.

2)  Govt. decided to have the price decided at the auction as the price at which spectrum will be renewed for existing companies. This ensured that participation from existing companies is minimal, and they ensured that the spectrum price did not go high since they will have to pay a higher renewal price if new spectrum is sold at a higher price.

Politicians & Businessmen colluded and fooled the nation – they showed that they followed all the steps laid down by Supreme Court and even then the price at which the auction happened is less and there is no loss from spectrum allotment done in 2008 – but most people have forgotten that in 2008 122 licences were sold, where this time only 22 have been sold at almost the same price (rigged to be kept low for benefits of businessmen & to protect politicians).
122/ 22 is 5.5, so the price at which all the licences would have been sold even at the base price is more than 52K crores, which definitely is higher than what Govt. made from the illegal spectrum sale in 2008.

Hope Supreme Court continues to follow up the developments in the telecom sector and ensures that the operators do not collude together and with the Politicians in cheating the Govt. out of the right price for spectrum and licence renewal.

Definitely going forward we will see that the licences that have not been sold would be sold at throw-away rates and all the businessmen & politicians will laugh the way back to their banks…