Multibillion-Dollar Telecom Scandal Ignites Fury in India

Former Indian Communications Minister Andimuthu Raja, right, looks on as Indian Prime Minister Manmohan Singh launches the third-generation services of state-run telecom provider Mahanagar Telephone Nigam in 2008. A recent scandal involving the auction of mobile-phone licenses led to Raja's resignation.

NEW DELHI, India — This year, India has been badly hit by its old vice of corruption, which currently involves politicians, judges and possibly even the media. People have been outraged by a series of scandals that have exposed the theft of billions of dollars.

“The public trust has been completely shattered in any section of the ruling establishment,” said Prashant Bhushan, a lawyer and activist who moved the Supreme Court to investigate the loss of $40 billion from the Indian Treasury in the “2G Spectrum” scam.

The scam, which is being dubbed as India’s biggest, stems from the selling of second-generation spectrum mobile-phone licenses at dirt-cheap prices to a select group of companies.These alleged transactions led to the loss of potential revenue that would have been generated at regular prices. The telecom minister, Andimuthu Raja, resigned as the scandal exploded recently.

The episode also sparked criticism of inaction by Prime Minister Manmohan Singh, who is generally regarded as being above suspicion of wrongdoing. The opposition Bhartiya Janta Party is also milking the scandal for political mileage.

Sonia Gandhi, president of the ruling Congress Party, has described attacks against Singh as “downright despicable.”

The BJP, which is demanding that a joint parliamentary committee be set up to investigate the corruption, has been blasted for holding up the winter session of Parliament because of the scandal.

“They did not allow any opportunity for any discussion on any issue,” Finance Minister Pranab Mukherjee said. They have created deadlock in Parliament. They have destroyed the institution. They should apologize to the nation.”

The 2G scam has spotlighted the dangerous nexus between government officials and large businesses, according to activists. The companies that allegedly bought the mobile phone licenses include powerhouses like Tata Teleservices Ltd. and Reliance Communications. Both have denied involvement.

Bhushan blamed the corruption problem on “crony capitalism” where everyone did favors for and received favors from the dominant corporations. “The prime minister may not be dishonest himself, but he has let himself become a willing marionette in the hands of these large corporations,” he said.

Besides 2G, 2010 has seen allegations of massive corruption that grossly overshot the cost for organizing this summer’s Commonwealth Games. To top it all, recently leaked tapes indicate that a corporate lobbyist, Nira Radia, was trying to influence the appointment of politicians to serve the interests of her powerful business clients, including Tata and Reliance.

Public fury surged when conversations in the “Nira Radia tapes” suggested that prominent media personalities were helping the lobbyist in her plans. Two journalists, Barkha Dutt and Vir Sanghvi, have strongly denied the allegations and claimed they were stringing their source along to pump her for information.

Describing the media as an “important watchdog” in recurring corruption scandals,
Anupama Jha, the head of Transparency International India, noted that faith in the way journalism was being practiced in the country had indeed been weakened. “It shows that everyone is going for self-interest over national interest,” she said.

Meanwhile, a report by the Washington-based Global Financial Integrity has found that at least $462 billion was illegally transferred overseas from India between 1948 and 2008.

“It is our money that has gone abroad. The poor are becoming poorer, and there is a sense of victimization,” said Jha, suggesting that India needed to quickly ratify the United Nations Convention Against Corruption.

India ranked 87th out of 178 countries on Transparency International’s Corruption Perception Index this year, faring better than its neighbors Pakistan, Sri Lanka and Bangladesh.

Analysts are perhaps most worried about the lack of political will to address the systemic causes of corruption in the country, and the lack of assurances that the lost money will be returned to the Treasury.
The failure of their leaders has caused citizens to form organizations for combating the problem. Delhi-based Parivartan (Change), for instance, is one such group that tries to fix corruption in areas that affects normal life, like income taxes and electricity.

Vijay Goel, who volunteers with Parivartan, attributes the high level of corruption to an absence of an independent anti-corruption agency, and suggests that such a body should be run by “responsible citizens” without interference from the government.

With government watchdog agencies being regarded as ineffectual in fighting corruption, recommendations by activists to create a single autonomous body with powers to haul up politicians and judges are in the works, but these proposals have not yet been formalized.

Noting that a plan to set up an independent body was “not moving,” Goel said, “Politicians are only interested in playing a blame game, but it is the citizens who are getting fooled.”

Multibillion-Dollar Telecom Scandal Ignites Fury in India.

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