Telecom Minister Kapil Sibal on Friday said Prime Minister Manmohan Singh was informed about the 2G spectrum pricing in 2007 and he had "accepted" it.
"The Prime Minister was also informed that the issue of pricing of spectrum was discussed extensively between the Ministry of Finance and the Department of Telecommunications in line with the earlier decision of the Cabinet in 2003 which left the issue of spectrum pricing to be decided by the two ministers," he told a press conference here.
The Opposition has been demanding Prime Minister Manmohan Singh's explanation saying the former telecom Minister A Raja, who was forced to resign over the alleged spectrum scam, had claimed that the Prime Minister was in know of all decisions. Raja had distributed 122 new licences in January 2008 at 2001 prices of Rs 1,658 crore for pan-India licence and the government auditor had quantified presumptive revenue loss of Rs 1.76 lakh crore to the exchequer.
"The Minister of Telecom (Raja) also consulted the then External Affairs Minister (Pranab Mukherjee) who was the Chairman of the EGoM on spectrum issues. Based on these consultations PM was informed that the Finance Minister (P Chidambaram) and the DoT after considering all options, had come to an agreement that the 2G pricing should continue as before, while 3G spectrum would be auctioned.
"The Prime Minister accepted this outcome regarding spectrum pricing," Sibal said at the press conference called to explain that the loss was "nil". He dubbed CAG's estimation of presumptive loss as "erroneous". Giving details of exchange of the correspondence in the run up to the 2G spectrum allocation in 2008, he said the Prime Minister had received several suggestions to consider change in policy in 2007, including a switch to auctions.
The Prime Minister wrote to the Minister of Telecom (Raja) on 2nd November, 2007 forwarding a summary of the suggestions received and requested the minister to consider all the aspects carefully. "This has been wrongly interpreted in the CAG report as a direction to act in a particular manner on the issue of pricing," he said adding "the only direction given by the Prime Minister was that the Ministry should act in a fair and transparent manner and keep the PM informed."