Finance ministry note points 2G finger at PC | delhi | Hindustan Times
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Finance ministry note points 2G finger at PC

A finance ministry note to the prime minister's office (PMO) this year said the 2G spectrum scam could have been avoided if then finance minister P Chidambaram had insisted on spectrum allocation through auction. HT reports. Finance ministry's note | The Tangle

delhi Updated: Sep 22, 2011 08:27 IST
HT Correspondents

A finance ministry note to the prime minister's office (PMO) this year said the 2G spectrum scam could have been avoided if then finance minister P Chidambaram had insisted on spectrum allocation through auction.


This revealed cracks within the UPA leadership and exposed the coalition to attacks from the opposition, which latched on to the note on Wednesday night, demanding the resignation of Chidambaram, who is now home minister.

Chidambaram said in a meeting with then telecom minister A Raja on January 30, 2008 that “he was for now not seeking to revisit the current regimes for entry fee or revenue share” of spectrum, says the note.

The department of economic affairs note, dated March 25, 2011, was issued with finance minister Pranab Mukherjee's approval. Finance Ministry's note

The turn of events has given a fresh twist to India’s most high-profile corruption case — valued at as much as Rs176,000 crore by the CAG — in which Raja, former secretary S Behura, and several promoters and top executives of telecom companies are behind bars in Delhi’s Tihar jail. http://www.hindustantimes.com/images/HTPopups/210911/22-09-11-metro1.jpg

BJP spokesperson Prakash Javadekar said, “It was very clear from day one that Chidambaram agreed to A Raja’s formula. If he had stuck to the finance ministry officials’ position that the spectrum shouldn’t be allocated in 2008 at 2001 prices…he should step down.”

CPI national secretary D Raja said the note was a serious issue and the PM should explain what action he had taken since March. “The CBI should probe the entire matter and once that happens, Chidambaram's position as home minister becomes untenable.”

The Congress declined to comment on the issue. “BJP is jumping to conclusions. It should stop being in a hurry on every issue. Let's wait for a while,” party spokesperson Renuka Chowdhary said.

The document said Chidambaram wrote a “secret note” to the prime minister on January 15, 2008, five days after the department of telecommunications granted licences to new operators.

He recommended an auction-based mechanism for future allocation (beyond the start-up spectrum of 4.4 Mhz) and treat previous spectrum allocations — in this case, the 2G — as a “closed chapter”.

Even then, finance secretary and current RBI governor D Subbarao said in February 2008 — after allocation was fixed — that the department of telecom could still have gone for an auction, irrespective of the decision taken earlier.

“The DoT could have invoked this clause for cancelling the licences in case the ministry of finance had stuck to the stand of auctioning the 4.4 Mhz spectrum,” said the note provided by the PMO to an RTI activist, Vivek Garg. Chidambaram's 'complicity' reflected in Pranab's letter: BJP | Swamy gives SC proof on PC's role