While it has been about fourteen to fifteen years, 2G scam still remains fresh in the minds of Indian people and the policy makers. It is still one of the biggest public scam in the history of India. If were a teen just then, you might not know much about the 2G scam. The scam unfolded around 2010-11, and shook the entire country to its core. It happened due to just one overlooked thing - spectrum allocation method.
The rise of the phone maket in India pushed the growth of mobile subscriber numbers as well. India had come a long way, and almost everyone carried a handset with them by 2008-09. This meant more telecom carriers could come into the market and offer services. Here's where the entire thing happened.
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What was the 2G Scam?
The 2G scam is simple to understand. At the time, the government didn't auction the spectrum, instead, it allocated it administratively to players on a first come first served basis. The rates/price of the spectrum was still the same as 2001, despite the growth of market, and potential revenues. Taking advantage of this, a key government official sold the 2G spectrum license at low prices to favour some companies. These companies then sold a part of their stake to foreign investors at higher prices. This scam resulted in loss to the government.
How a Telecom Minister Was at the Center of it All
A Raja, former telecom minster of India, was found suspect in the massive 2G spectrum scam. The scam was simple, as mentioned above. A Raja was the official found selling the 2G spectrum license at a lower price to some companies.
Ultimately, the Supreme Court cancelled these 2G licenses as things came to light. There were legal proceedings towards A Raja for years, and in 2017, he was acquited of all the charges by a special court, stating that the prosecution failed to prove the charges. But the CBI and ED challenged this acquital at the Supreme Court in 2018 and since then the legal battle has continued, even as A Raja serves as a DMK MP now.
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Supreme Court Ordered Auctions is the Right Way
Following this scam, the Supreme Court of India decided that only an auction is the correct way to sell spectrum to the telcos. Since then, there have been nothing but spectrum auctions in India.
