All is well

The verdict on 2-G scam is out!

Business & Politics

December 22, 2017

/ By / New Delhi

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India's largest scam since Independence

India wonders what has happened to the 2-G scam. The verdict over it has given a new lease of political ammunition to both the Congress at the national level, transformed DMK as one of the most potential allies in South India and businessman relieved. No doubt all is well.

Dubbed as India’s largest scam since Independence, all the accused in the 2-G Spectrum were acquitted by the Special Court on Thursday.

Those acquitted by the Special Judge OP Saini include former telecom minister A Raja, M Kanimozhi of the DMK and 15 others.

The verdict will have a huge implication on the course of politics in the coming months, ahead of the 2019 General Elections. The corruption scandal led to the downfall of the second United Progressive Alliance Government (2009-2014).

The verdict will be a huge morale booster for the Congress-led UPA whose government was pulled down due to the allegations of the 2G Scam worth INR 40 billion, which rocked the telecom industry in 2011. Three years later, it demolished the UPA government at the Centre and diminished its presence in several states. Similarly, the DMK too faced the heat in the southern state of Tamil Nadu and nearly a decade-long political embarrassment.

All that will change now.

What is the 2-G Scam?

On 16 November 2010, the Comptroller and Auditor General of India (CAG), the country’s accounting watchdog came out with its report on the issuance of licenses and allocation of 2-G spectrum by the Department of Telecom. CAG, then headed by Vinod Rai, revealed that 122 licenses had been issued to telecom operators at throwaway prices, causing a loss of INR 40 billion to the exchequer.

Other allegations include the following:

  • The cut-off date of the auction was advanced by the Telecom Ministry.
  • Licenses were issued on a distorted First Come First Served (FCFS) Policy and that too at 2001 prices instead of 2008 prices
  • The Ministry allegedly shut counters to physically block selected telecom companies from entering the fray
  • Telecom Minister Raja acted against the advice of the Telecom Regulatory Authority of India (TRAI), the Law Ministry and the Finance Ministry
  • Licenses had been issued to ineligible applicants and to those using fraudulent means

The verdict

“I have absolutely no hesitation in holding that prosecution has miserably failed to prove any charge against any accused,” said Judge O P Saini, delivering the judgement.

Others acquitted in the case are former telecom secretary Siddharth Behura, Raja ‘s erstwhile private secretary R K Chandolia, Swan Telecom promoters Shahid Usman Balwa and Vinod Goenka, Unitech Ltd MD Sanjay Chandra and three top executives of the Reliance Anil Dhirubhai Ambani Group (RADAG) – Gautam Doshi, Surendra Pipara and Hari Nair.

Political implications of the verdict

Immediately after the judgement came out there was a flurry of political activity in the capital. DMK Rajya Sabha MP Kanimozhi, one of those acquitted, got surprise calls from the former Prime Minister Manmohan Singh and Congress President Rahul Gandhi. The latter congratulated her on her acquittal.

The verdict has come at a time when the Congress has begun to revive itself. The Congress and the Opposition will showcase the scam perpetrated on it as a massive propaganda.

“I do not want to boast (about) anything. The court’s judgement has to be respected. I am glad that the court has pronounced unambiguously. All the massive propaganda, against the UPA, was without any foundation. The judgement speaks for itself,” Singh asserted hitting out at his political detractors.

The judgement will have implications on both national politics as well as in the state politics of Tamil Nadu.  “There are three important political ramifications of the 2-G scam verdict, ” observes N Ashokan, editor, Andhimazai, a monthly journal in Tamil that analyses socio-political trends in the state.

For one, it removes the political stigma on both Raja and Kanimozhi. “They will campaign for the party as they are very good communicators.”

An even bigger impact is that it removes the blot of corruption on DMK. “The verdict will revive the party and prepare the cadre to face the polls boldly.”

Lastly, it gives the party a stronghold against the ruling AIADMK, which is in total disarray, he points out.  The state is reeling under a political turmoil, thanks to the in-fighting in the ruling AIADMK after the demise of Chief Minister J Jayalalitha.

DMK Celebrates

Ailing DMK nonagenarian founder, M Karunanidhi also welcomed the verdict. “Injustice will be defeated, good deeds will triumph.”

His son and DMK working president M K Stalin asserted the case was a ‘conspiracy’ to destroy the party. “It was a conspiracy to destroy the DMK. I would like to tell (the media), you made this case so big to taint the DMK. Now, it has been proved that we haven’t made any mistake,” Stalin said, addressing the reporters. “Now, do justice and take this judgment to the people.”

After Prime Minister Narendra Modi visited ailing Karnunanidhi it was heavily speculated that BJP and DMK will forge an alliance.  Stalin had dismissed them as wild speculations. For a party, which has built an ideology based on the anti-BJP stand, joining hands with them makes little sense.

A shift in public perception

The BJP may benefit from its alliance with DMK as it has a smaller vote base. Then, why would DMK commit a political hara-kiri by aligning with BJP? Unlike the BJP the Congress has a better base in Tamil Nadu.

Even as public perception about the Modi government has nose-dived as attested by the results of Gujarat Assembly elections, Southern states may be crucial in winning the 2019 elections. In 2014 General Elections, the AIADMK won 37 out of 39 seats in the state. With AIADMK in disarray, DMK may sweep the polls when the elections are held. BJP national president Amit Shah has been strategising on how to win 150 seats from Southern states for more than two years now.

The verdict will weaken the possibility of superstars, such as Kamal Haasan, Rajinikanth and Vishal entering the political fray and trying to capitalise on anti-incumbency trends and corruption in politics.

Reacting to the 2-G case verdict, Finance Minister Arun Jaitley said that the Congress must not consider it as ”a certificate to its honest policies.”

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