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Coalgate – A real scam

UPA has been in power since last 8 years and during eight years of UPA rule, most probably India has seen the biggest scams. So many scams one after another made people used to and even people stopped bothering scams whose worth is in few crore. As of now, we have been thinking 2G was the biggest even scam we had in India, however new Coalgate scam seems to be much bigger than 2G (if we go by CAG report). But as usual government is not ready to accept CAG report and still defending their stand – there is no loss (zero loss). But a quick question comes to mind; is it corruption or incompetence, or corruption that ensures incompetence? Let’s have a look on 2G and Coalgate scams, it will give relatively good idea about both the incidents sequentially and government’s stand.

2G Coalgate
Chairperson of UPA Sonia Gandhi Sonia Gandhi
Prime Minister Mr. Manmohan Singh Mr. Manmohan Singh
Ministry Telecom Coal
Minister in Charge Mr. A Raja Mr Manmohan Singh
Why not opted for Auction Prime Minister and the Finance Secretary sought spectrum auctions which A. Raja refused Coal Secretary who sought auctions which the Manmohan Singh ignored or overruled
Decision makers Key politicians and bureaucrats Key politicians and bureaucrats
Beneficiary Private parties through the involvement or decision-making of key politicians and bureaucrats Private parties through the involvement or decision-making of key politicians and bureaucrats
Government’s stand on Losses 0.00 0.00
Actual Losses Massive losses for the state exchequer Massive losses for the state exchequer
Allocation Process First-come, first-served (FCFS) Application-based selection
Justification Award is justified by officials with scant public scrutiny Award is justified by officials with scant public scrutiny
Guidelines Unified Access Service Licence Captive block selection
Selection committee Bureaucrats from across Ministries/States who failed to implement any safeguards Bureaucrats from across Ministries/States who failed to implement any safeguards
Origin of the issue CAG report CAG report
Role of CBI CBI acted only after directions from the Central Vigilance Commission registering an FIR for spectrum CBI acted only after directions from the Central Vigilance Commission registering a preliminary enquiry
Government’s stand The government has compromised its position by offering the same defence and almost in the same pattern and in the same sequence of events The government has compromised its position by offering the same defence and almost in the same pattern and in the same sequence of events
Minister’s stand/justification The department was not deviating from the existing procedure and that full transparency is being maintained by my ministry The process of allocation of blocks was equitable, fair and just, which is borne out of the fact that there have never been any serious allegations against the working of the screening committee
Statement by Minister Mr. A Raja defended FCFS by arguing the case of public interest and economic growth. Mr. Shriprakash Jaiswal defended administrative allocation by arguing the case of public interest and economic growth
Objective of Government It was needed for proliferation of telecom services in a competitive environment at affordable tariffs for the common people and especially the rural masses It was needed for the nation’s growth, its industrial growth and for power production at affordable rates.
Government’s next line of defence Revenue generation was never a priority for telecom Allocation of coal blocks was never looked upon as a potential source for generating revenue for the central government; hence the question of maximization of revenue does not arise at all.
Justification for not going for auctions A matter of policy and government policy is not open to judicial scrutiny A matter of policy and government policy is not open to judicial scrutiny
Show cause notices Issued to private companies in December 2010 Issued to private companies in June 2012
Blame Game Mr. Raja, Kapil Sibal, Salman Khurshid and even the PM, have all placed the blame for the allocation of 2G spectrum on an FCFS basis in 2008 at 2001 prices on the NDA’s Cabinet decision of October 31, 2003 Mr. Jaiswal and Minister of State in the PMO, V. Narayanswamy, have placed the blame that during the NDA government the allocation was made without any advertisements and was far less transparent while Mr. Narayanswamy has alleged that senior functionaries of the NDA have also benefited from Coalgate
Success story Nearly 700 million subscribers and affordable tariffs helped mitigate the blow to the common man On-ground experience relating to coal shortage, power cuts and price hikes makes the scam more directly painful for the common man

 

Based on above comparisons; both the issues are more or less similar in nature. In case of 2G scam, due to the CAG report and the Supreme Court judgment of cancelling 122 licenses, forced government to go for auctions and which fetched around 14000 crore. Hence, government’s zero loss claim failed. Now coalgate issue is fresh and unless until Supreme Court interferes, it’s for sure nothing will happen and government will keep justifying zero loss logic. Real loss will be known if fresh auction will happen for allotted coalgate.

As far as government is concerned, 2G has already helped entrench the public view of corruption in the UPA government and now coalgate. In 2G case, Mr. Raja was in charge, however in coalgate PM himself had the coal portfolio for the period for which the allegations are being made; hence giving the PM much less wiggle room than in 2G. However, in a country like India, where judicial process is slow, it does for sure nothing will happen out of this scam. Mr. Manmohan Singh will continue to be stubbornly silent and Congress will pretend that no muck was thrown at it. Still, UPA has two years; we never know what other scams will surface in; till then just keep our fingers crossed. UPA government is so arrogantly shameless that nothing less than a national movement on the scale of JP’s movement will move it.

BY: Biraja Prasad Nath

Written by Biraja

Progress Software, National Institute of Technology

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