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2G Spectrum Scam
The 2G spectrum scam in India involved the issue of 122 licenses of the 2G spectrum to 85 companies including many new telecom companies with little or no experience in the telecom sector at a price set in the year 2001. The scam involved allegations regarding the under pricing of the 2G spectrum by the Department of Telecommunications which resulted in a heavy loss to the exchequer, and the illegal manipulation of the spectrum allocation process to favor select companies. The issue came to light after the auction of airwaves for 3G services which amounted to 67,719 crore (US$15.03 billion) to the exchequer. A report submitted by the Comptroller and Auditor General based on the money collected from 3G licenses estimated that the loss to the exchequer due to under pricing of the 2G spectrum was 176,379 crore (US$39.16 billion). The scam came to public notice when the Supreme Court of India took Subramaniam Swamy's complaints on record [With Case type: Writ Petition Year: 2011]. Politicians involved in Scam :1. A Raja - The Controller and Auditor General holds Raja personally responsible for the sale of 2G spectrum at 2001 rates in 2008, resulting the previously mentioned loss of up to Rs. 1.76 lakh crores (US$40 billion) to the national exchequer. In August, 2010, evidence was submitted by the Controller and Auditor General (CAG) showing that Raja had personally signed and approved the majority of the questionable allocations. 2. Kanimozhi Karunanidhi - On April 25, 2011 Kanimozhi was named as a co-conspirator in the supplementary chargesheet filed by the Central Bureau of Investigation (CBI) in connection with the 2G spectrum case. The charge sheet, which was submitted before the Supreme Court establishes how Rs 200 crore connected with the scam traveled from a partnership firm of businessman Shahid Balwa of Swan Telecom to the Karunanidhi family-owned Kalaignar TV. She has been charged with section 7 and 11 of the Prevention of Corruption Act. The sections deal with acceptance of alleged gratification. Corporate Personalities involved :1. Anil Ambani - Reliance Group (ADAG) 2. Shahid Balwa - DB Realty and Etisalat DB Telecom (formerly Swan Telecom) 3. Vinod Goenka - Dynamix Group 4. Venugopal Dhoot - Videocon Group 5. Prashant Ruia - Essar Group 6. Ratan Tata - Tata Group All of them have either been questioned by the CBI or are prospective suspects in the scam.

Media persons and lobbyists involved :1. Nira Radia, a former airline entrepreneur turned corporate lobbyist whose conversations with politicians and corporate entities were recorded by the government authorities. The contents were later leaked by unknown parties creating the Nira Radia tapes controversy. 2. Vir Sanghvi, a Hindustan Times editor alleged to have edited articles to reduce blame in the Nira Radia tapes. Corporations involved :1. Allianz Infra 2. Dishnet Wireless 3. Loop Mobile 4. Sistema Shyam Mobile (MTS) Sistema Mobile Russia 5. Reliance Communications 6. S Tel 7. Swan Telecom sold 45% of its company stake at huge profit to Emirates Telecommunications Corporation (Etisalat) after buying licensing 8. Tata Teleservices 9. Unitech Group a real estate company entering the telecom industry with its 2G bid; sold 60% of its company stake at huge profit toTelenor after buying licensing (Including land values properties for towers) 10. Videocon Telecommunications Limited 11. Vodafone Essar 12. Virgin Mobile India Loss to Exchequer :The Comptroller and Auditor General of India used three different methods to assess the presumptive loss to the exchequer resulting from not auctioning 2G spectrum. *The first method was based on the fact that S Tel, one of the licensees, explicitly offered to pay significantly higher license fees for the spectrum. Based on the fees offered by S Tel, the CAG estimated the loss to the exchequer at 67,364 crore (US$14.95 billion) *The second method was based on the price discovered by the 3G auction in 2010. The CAG reasoned that since 2G is really 2.75G (EDGE), its price should be comparable to that of 3G licenses. Based on this method, the CAG estimated the loss to the exchequer to be 176,000 crore (US$39.07 billion) *The third method was based on the fact that some of the licensees received FDI in the form of equity, shortly after the spectrum allocation. The CAG reasoned that this equity infusion was entirely due to the value of the allocated spectrum; this can be construed as re-sale of the spectrum by the licensee, and hence was a valid basis for assessing loss to the exchequer. Based on this method, the CAG estimated the loss to the exchequer to be anywhere between 57,666 crore (US$12.8 billion) (based on Etisalat's investment in Swan Telecom) and 69,626 crore (US$15.46 billion) (based on Telenor's investment in Unitech).