Monday, March 27, 2017
  Search 
Home
Opportunities
Partners
Publications
About Us
 
 
Please enter your email here, we would like to keep you informed.
 
 
Connect With Us - Facebook RSS
<March 2017>
SuMoTuWeThFrSa
1234
567891011
12131415161718
19202122232425
262728293031
Sections
Liberty In The News
Liberty Events
Conference Proceedings
Culture
Agriculture
Democracy
Development is the Key
Economic Freedom
Education for Life
Enterpreneurship
Environment
Freedom of Expression
Freedom to Trade
Globalization for the Good
Health is Wealth
Intellectual Property Rights
International Relations
Liberty is Security
Limited Government
Principles of Politics
Privatisation
Population - the ultimate resource
Property Rights
Regulatory Affairs
Rule of Law
Tax Freedom
Facts & Figures
Opportunities
Competitions
 Privatisation
 
Zero credibility
Business Standard, India Saturday, January 15, 2011


When Mr Sibal claims zero loss, in relation to the pricing of spectrum I'm afraid he carries zero credibility. He repeats Mr Raja’s claim that his decisions had the approval of the prime minister and other ministers concerned, including the then as well as current finance minister. It is precisely because private parties got the benefit that the taxpayer could have got that there have been charges of large-scale revenue loss, writes T N Ninan in Business Standard.

There has been a good deal of debate after the Telecom Minister, Kapil Sibal, came out with his “zero loss” assertion last week, in relation to the pricing of spectrum three years ago. Sieving through the debate, the following seems to be clear:
 
Mr Sibal’s position on spectrum pricing is the same as that of Mr Raja. Indeed, he repeats Mr Raja’s claim that his decisions had the approval of the prime minister and other ministers concerned, including the then as well as current finance minister.

...

Taking these assertions as true, Mr Sibal’s follow-on claims and justifications merit examination. He says that the government’s intention has never been to maximise revenue, what it is interested in is increasing tele-density through low-cost services. Indeed, this is what has been achieved, as Mr Raja argued in his defence. The problem is that the link between low spectrum pricing by the government and the claimed result of low telecom charges and, therefore, greater tele-density is non-existent, because those who got the spectrum promptly encashed the gift and made windfall gains — which is when the scandal blew up in everyone’s face, not when the Comptroller and Auditor General came with his calculator nearly three years later. If what was intended to be a consumer benefit ended up being an intermediary’s windfall gain, the policy obviously backfired. And it is precisely because private parties got the benefit that the taxpayer could have got that there have been charges of large-scale revenue loss.

Mr Sibal said at his press conference that there was no revenue loss, something that his written statement does not say.

....

If we focus on the reality that the whole country can see, and not the technicalities of government policy-making that Mr Sibal focused on, the issue that remains to be debated is the quantum of loss to the government. Mr Sibal questions the CAG’s figure of Rs 1.76 lakh crore on the perfectly valid argument that you cannot take a 2010 price and apply it to a 2008 situation. But that is what the government itself did, when it took a 2001 price and applied it in 2008, though the telecom scene had been transformed in between. As it happens, the CAG has more than one figure of revenue loss. Several commentators have also come up with numbers, which run into tens of thousands of crores. And because of the aberrant manner in which Mr Raja handed out these substantial gifts, it became the largest scam in our history. So when Mr Sibal claims zero loss, I’m afraid he carries zero credibility.

This article was published in the Business Standard on Saturday, January 15, 2011. Please read the original article here.
Tags- Find more articles on - spectrum | zero loss

Post your Comments on this Article

Name  
Email    
Comment  
Comments will be moderated

Privatisation
More Articles


 
An Initiative of
LIBERTY INSTITUTE, INDIA
All rights reserved.