Raja challenges PM on Unitech, Swan stake sale

Says PM and Chidambaram were kept in the loop on foreign companies’ stake purchase.

Former telecom minister A Raja on Monday said Prime Minister Manmohan Singh was present when the then finance minister, P Chidambaram, had approved Telenor and Etisalat’s proposals to pick up stakes in the new licensees, Unitech and Swan, respectively. He challenged the prime minister to deny this.

Raja, who has been in jail since February over corruption charges related to 2G spectrum allocation in 2007-08, was defending himself in the special CBI court.

Asked why he did not auction spectrum and opted for the first-come-first-serve policy, Raja said he was just implementing polices that he had inherited. His counsel, Sushil Kumar, said if Raja was being put in the dock for following a certain telecom policy, all telecom ministers since 1993 — when the policy came into force — should be jailed.

However, Chidambaram said the only issue that came to him in 2007 was whether Swan and Unitech were trying to sell stakes or dilute stakes by issuing fresh equity.

Chidambaram said the telecom ministry wanted the entry fee to remain at the 2001 level, but the finance ministry favoured auctions.

“Swan Telecom and Unitech were inducting foreign partners or new partners. They had the spectrum and the licences. I think DoT approved the induction of new partners,” he said. He said the real question was whether promoters were divesting or diluting equity through issue of fresh shares. “This was examined by the finance ministry. Both were cases of dilution of equity through issue of fresh shares. The prime minister wanted to know if it was a dilution of equity or a divestment,” he said. “I do not think there was any sale of spectrum. The spectrum was allocated to the company which got the licence and it remained with the company,” he said.

Communications and IT Minister Kapil Sibal agreed with Chidambaram. “There was no disinvestment. It was dilution of stake by bringing in additional equity,” he said.

During the court hearing, Raja said he did nothing wrong and was just following the policies of his predecessor and the NDA government. He said as telecom minister, Arun Shourie distributed 26 licences, Dayanidhi Maran 25 and he 122. “The numbers make no difference. It is to be noted that none of them auctioned spectrum. Why am I being questioned? Let them deny that they have not done what I did,” he said.

Raja said he was following the 2003 cabinet decision of not auctioning 2G spectrum and he should not be prosecuted for following the law.

“I am not liable to be prosecuted. In fact, I should be rewarded,” he said.

So far, the charges on which Raja has given his defence relate to 2G auction and losses caused to the exchequer under 120B and 420 of the Prevention of Corruption Act. He is yet to present his arguments on charges of favouring a private company and misusing his official position.

Raja said it was not yet clear what the loss was. “The current IT minister said no loss was incurred. The prime minister has also taken this stand in Parliament. So, for what am I being charged?”

Raja said the Central Bureau of Investigation (CBI) was following a pick-and-choose policy. He said it was basically threatening that if you say this you would become a witness and if you do not say this you would be sent to jail.

He said nine telecom companies were issued 2G licences but CBI alleged that he conspired only with two companies, Swan Telecom and Unitech Wireless, leaving out Tata Teleservices and others.

Defending the policy followed by him, Raja said he wanted to make mobile calls affordable for every man on the street, even a rickshawala. “It was my obligation to social justice that every man on the street should have a mobile phone. I am a servant of my people,” he said.

Raja, along with 13 other accused, including DMK MP Kanimozhi, is lodged in Tihar jail.