NEWS ANALYSIS Wants to question Prime Minister, Chidambaram on ‘contradictory’ statements

The attempt by Congress members of the Joint Parliamentary Committee (JPC) on telecom last week to halt investigations on the pretext of rushing the report is aimed at ensuring that the JPC does not question the manner in which Prime Minister Manmohan Singh and Home Minister P. Chidambaram have contradicted each other on key issues relating to the spectrum scam, Opposition sources on the Committee told The Hindu.

Underpricing spectrum: 2006

The Prime Minister has said that among the reasons why he allowed spectrum pricing to be dropped from the final December 7, 2006 Terms of Reference (ToRs) of the Group of Ministers (GoM) on spectrum was that “ was pointed out to me that there was a Cabinet decision of 2003, which said that spectrum price is a matter which should be discussed between the Finance Ministry (MoF) and the Telecom Ministry (DoT).”

Dr. Singh made this disclosure on his flight from New York to Delhi on September 28, 2011. These modified ToRs without spectrum pricing allowed the former Telecom Minister Dayanidhi Maran to grant 14 licences on a first-come, first-served basis to Aircel in 2006 at 2001 prices, giving the firm windfall gains while making it a pan-India operator. Spectrum for these licences was later granted by Mr. Maran’s successor A. Raja in 2008, which the CAG in 2010, valued at nearly ten times the original price of allocation.

Mr. Maran was forced to quit the Union Cabinet after the Enforcement Directorate filed a case in February 2012 against him and his brother for alleged receipt of Rs. 550 crore in kickbacks linked to the Maxis-Aircel deal.

However, in a recent twist, Mr. Chidambaram, indirectly undercut the PM’s logic by noting there was never any agreement between the MoF and the DoT. In a letter to The Hindu in which he contested the claim that as Finance Minister he had not protested the dropping of spectrum charges from the ToRs, he revealed that far from agreeing, “The MoF sent an OM on 18 May 2006 with the approval of the Finance Minister, insisting that spectrum pricing should be included in the ToR.” Additionally, “the MoF protested and wrote several letters to the DoT and the Cabinet Secretariat demanding inclusion of spectrum pricing in the ToR.” Opposition MPs on the JPC say they would like to know why Mr. Chidambaram’s protests were ignored by the PM.

2G scam: 2008

Asked why he did not insist on auctions in 2007-08 during Mr. Raja's tenure, the PM clarified, at a press conference on February 16, 2011 and in the Rajya Sabha on February 24, 2011, “The government policy on pricing of spectrum was taken on the basis of the Cabinet decision of 2003, which specifically left this issue to be determined by the MoF and the Ministry of Telecommunications.” He added, “The two Ministers had agreed because of legacy considerations and I accepted the recommendation.”

A government press release of January 7, 2011 gave the PM a clean chit by specifying that the 2G spectrum pricing was discussed extensively between the MoF and the DoT in line with the Cabinet decision of 2003. It added that the Finance Minister and the DoT “after considering all options, had come to an agreement that the 2G spectrum pricing would continue as before,” based on which the PM accepted the outcome.

The PM’s statement in Parliament was made within days of Mr. Raja’s arrest, presumably in anticipation of Mr. Raja seeking to implicate him and Mr. Chidambaram in the 2G spectrum mess. Five months later, in June 2011 during his deposition in the Special CBI Court, Mr. Raja predictably dragged both the PM and Mr. Chidambaram into the scam, challenging the PM to deny it.

Following the press release, the PM’s clarification and Mr. Raja’s statement in court, the focus shifted from the PM to Mr. Chidambaram.

However, when attempts were made to get the trial court to prosecute him, the government took a U-turn: a December 10, 2011 press release rubbished any possibility of agreement between Mr. Chidambaram and Mr. Raja.

The new release claimed, “As Finance Minister, it was Shri P. Chidambaram who raised the issue of revision of entry fee. However, the final view taken by the DoT was that it would adopt the same policy that had been followed since 2003, including charging the same entry fee of about Rs. 1,650 crore.” Going on to reverse the PM’s claim to the press and in the Rajya Sabha, it added, “It is therefore preposterous to suggest that Shri P. Chidambaram had any role to play in fixing the entry fee of the LoIs issued on January 10, 2008.”

Later, Mr. Chidambaram too contradicted the PM’s statement about his agreement with Mr. Raja on the 2G spectrum pricing to the media, including in a letter to The Hindu published on February 18, 2012. Mr. Chidambaram wrote, “There was never any agreement between the Minister of C&IT [A. Raja] and me not to revise the entry fee. On the contrary, the decision was taken by the government at the high level meeting on 4.7.2008 to revise and update the entry fee.”

Beyond merely denying agreement with Mr. Raja, Mr. Chidambaram actually noted that the decision to revise the entry fee was taken in the presence of the PM and Mr. Raja. This explains why some members of the JPC want all three — the PM, Mr. Chidambaram and Mr. Raja — to appear as witnesses.

PAC yes, JPC no

Ironically, the Congressmen are resisting demands to bring the PM and Mr. Chidambaram as witnesses in the JPC, when the PM himself, in December 2010 — while battling the Opposition’s demand for a JPC — had in writing offered to appear before the Public Accounts Committee (PAC).

Interestingly, the response of the PM’s spokesman to a detailed questionnaire from The Hindu, seeking clarifications on the contradictions between several of the statements of the PM and Mr. Chidambaram in 2006, was that the information was not available as “all the relevant files and documents pertaining to the issues you raised have been sent to the JPC and the PAC by the PMO and are now in the public domain.”

Under the rules of procedure governing the JPC, these documents are treated as confidential and are thus not in the public domain. This makes it obvious that the JPC is the only forum left to reconcile the PM, Mr. Chidambaram and Mr. Raja's multiple contradictory statements.

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