Indications of wrongdoing and irregularities in the BSNL shortlisting WiMAX franchisees were available to the UPA government about a year ago, around the time CPI(M) MPs had written three letters to Prime Minister Manmohan Singh drawing his attention to the issue.
It was also the time details of the 2G spectrum allocation scam had started emerging and A. Raja had to resign as Minister for Communications and Information Technology. It was only after his exit from the Ministry, that some kind of probe into the allegations of bungling in WiMAX franchise was initiated.
Telecom panel probe
A four-member committee, headed by Vijayalakshmy Gupta, Member (Finance), Telecom Commission, was constituted on February 21 this year for examining the course of action taken by the Bharat Sanchar Nigam Limited while floating a tender/Expression of Interest (EOI) for shortlisting bidders for WiMAX franchise.
The committee was also asked to scrutinise whether commercial and other interests of the BSNL had been sacrificed.
What documents reveal
Documents accessed by The Hindu show that at the same time, the Central Vigilance Commission (CVC) was also looking into the WiMAX affair and on March 21, 2011 it decided to refer the case to the Central Bureau of Investigation for further probe and forwarded to the agency all documents received from the Department of Telecom and the BSNL. The CVC perused the committee's report and observed that irregularities had been committed by BSNL officials in the award of franchises to Soma Networks and Teracom, as also to three others — Ampoules and Auto Pvt. Ltd, Adishwar India and Take Solutions.
The period of scrutiny
Significantly, the period under scrutiny is the one when Mr. Raja was at the helm in the Telecom Ministry. He was arrested by the CBI this February and chargesheeted in the 2G scam case.
The latest Preliminary Enquiry (PE) in the WiMAX matter may spell more trouble for Mr. Raja. Well-placed sources said he allegedly intervened in the matter and thereafter the BSNL decided to give the WiMAX to Ampoules, which did not meet eligibility norms.
Not in BSNL's interest
The DoT committee said the terms offered to these franchisees were “not in the financial interest of the BSNL” and that the deals “need to be reviewed.” CBI sources said the report also dealt with the role of top BSNL officials in formulating the deals. WiMAX is one of the technologies that offers wireless broadband services.
In January 2008, the BSNL selected Soma Networks for WiMAX service in Gujarat, Maharashtra, Goa and Andhra Pradesh. Early last year, Teracom, Take Solutions, Adishwar India and Ampoules were selected through a bidding process for offering WiMAX services in 16 circles.
Teracom is a well-established equipment vendor and regular supplier to the BSNL and the MTNL, with its turnover reportedly exceeding Rs. 1,000 crore. Teracom was found eligible both financially and technically but it did not have the requisite experience on its own, though it was found eligible jointly with another firm Cisco, which withdrew later.
Adishwar is a listed company with over Rs. 1,000-crore turnover in other white goods business but has not had past experience in telecom services. Adishwar's technology partner was said to be Alvarion Limited of Israel.
Take Solutions Limited, though financially sound with a good turnover, also lacked any previous experience in the telecom sector. It also had Alvarion as its technology partner.
Ampoules and Auto, which changed its name to Starnet Communication Pvt. Ltd., figures in the PE registered by the CBI. It also lacked past experience and in its case too Alvarion's experience was counted and Ampoules declared eligible. Also, how Ampoules changed hands is a subject of investigation, the sources said.
