On former telecom minister A. Raja and allocation of second-generation (2G) telecom spectrum
Well, let me first deal with what I said to Mr (A.) Raja in a letter that I wrote to him on the 2nd of November, 2007. I mentioned in that letter a number of concerns that were being expressed—some in the press, some telecom companies used to come and mention them to me, and I listed a number of issues and I said to him that you must look into these issues and ensure that they are dealt with in a fair and equitable, transparent manner. One of the issues I had asked him to look into was the possibility from legal and technical angle of having an auction aspect. Mr Raja wrote back to me almost on the same day—our letters crossed—and he said “I have been absolutely transparent in my dealings, I will be so in the future and you have my assurance that I have done nothing and will do nothing which will not be consistent with the promise that I made.”
Now, as far as auction is concerned, he came back to me and he said “auction is something which has not been suggested by Trai (it was), also, not suggested by the Telecom Commission, and he also said that if we have auction, it would not give a level playing field for the newcomers because the existing players have got their spectrum free of charge until 10MHz. And, therefore, he said, the Trai (Telecom Regulatory Authority of India) advice, the Telecom Commission’s advice, and his own view was that auctions are not the way forward—at least for 2G spectrum—and he also mentioned in his subsequent letter that he is agreeable for auction of 3G (third-generation) spectrum, but with regard to 2G spectrum, he was very clear that we should stay with the then existing approach and this was also discussed with the finance ministry.
Because in terms of the cabinet decision of 2003, the pricing and allocation of spectrum was to be settled between the ministry of finance and the telecom department. Initially, of course, the finance ministry did ask for a high price of spectrum, but after many discussions I think that the two ministries agreed that as far as 2G is concerned, we have to live with the present system, particularly with regard to the amount of spectrum that is built and embedded into a licence agreement.
So this is the background why I did not proceed further with this matter of pricing of spectrum; because if the ministry of finance and the ministry of telecom both agree and they have the obligation in terms of the cabinet decision of 2003 to decide that matter, and also since Trai is an expert body, Telecom Commission has experts. If all of them were of the same view, I did not feel I was in a position to insist that auctions must be insisted.
Now the other thing that you have mentioned about Mr Raja being inducted into the cabinet. Well, I cannot divulge what went on in the processes of cabinet formation but I would like to mention that we are a coalition government. In a coalition government, you can suggest your preferences but you have to go by what the leader of that particular coalition party ultimately insists. Mr Raja, along with Mr (Dayanidhi) Maran, was the choice of the DMK (Dravida Munnetra Kazhagam) party, and (at) that moment I had no reason, frankly speaking, to feel that anything seriously wrong had been done, and therefore I did not feel that I had the authority to object to Mr Raja’s entry. Because I quite honestly in May 2009—although complaints were coming in, but complaints were coming from all sides and some were from those companies which had not benefited, some were from those that had benefited but not benefited adequately—I was not in a position to make up my mind that anything seriously was wrong with Mr Raja’s doings at that time.
On the loss to the exchequer
I am not in a position to say that there is a foolproof method in which one can determine the extent of the loss (on spectrum allocation). I think it’s very much a function of what is your starting point. And it also depends upon your opinion. We have, for example, a budget that gives the subsidy for the food of Rs80,000 crore per annum. Some people may say these foodgrains should be sold at market price. So will we say then, because they are not sold at market prices, because you’re giving them subsidy, there’s a loss of Rs80,000 crore? We give subsidy to fertilizers, which cost about Rs60,000 crore every year. People can say that these fertilizers should be priced at the market rate, so would you then say that there is a loss of revenue of Rs60,000 crore in fertilizer sale? We subsidise the price of kerosene to an extent I think which is greater than many other subsidies. That imposes burdens on our oil marketing companies. Should we say then that because we give subsidies for kerosene sales under public distribution that there is a loss of revenue?
No, we have not lost will. I think we will persist. There are difficulties and Parliament is not allowed to function when the opposition-led states, for example, do not wish to cooperate with the path-breaking reforms of the single goods and services tax. This is a reform which is needed. This would I think make our tax system—if the reform comes about—the envy of the world, but the opposition parties, particularly the BJP (Bharatiya Janata Party), has taken a very hostile attitude.
I sincerely hope in this current budget you will see, for example, a clearer picture of the reform agenda that our government has. We have not given up.
On personal responsibility
No, I think that in a coalition government, there is a coalition; and obviously, things are not entirely the way I would like them to be. But, quite frankly, I never felt like resigning because I have a job to do. The country voted our party to be the leader of the UPA (United Progressive Alliance) coalition and we have a lot of unfinished business to accomplish, and therefore I have never thought in terms of giving up halfway and I will stay the course.
We have still a long way to go. I still have to complete this term. As far as the next term is concerned, I think it’s too premature for me to speculate who will be the candidate (for prime minister).
Well, I have said that after the budget session of Parliament is over, there will be a restructuring, a reshuffle of the cabinet and I hope I will get back to that task once the session of Parliament is over.
I never said that I made no mistakes. But I am not as much of a culprit as I am being made out to be in public.
Food inflation’s impact on poor
Well, let me say that the food inflation certainly hurts the poor. The poor labourers spend nearly 60% of their income on food items and, therefore, when food prices rise disproportionately, it does hurt the poor most. But at the same time you must appreciate that we have put in place social safety nets.
On coalition pressures
Some compromises have to be made in managing a coalition government and those issues therefore, I think, have to be viewed in the context in which no single party has, I think, emerged which can rule by itself.
On the Devas-Isro deal
There have been no backroom talks. I think, I have not met anybody myself and the decision of the space commission to annul the deal was taken on the 2nd of July.
On external aid
Well, I think that India still is a poor country. And it is certainly true that if aid is not forthcoming we will not collapse. But I think we have the capacity to make good use of development assistance, and if some friendly country offers, I think, a large amount of money by way of concessional development support I don’t see reason why we should decline to accept it.
On India’s image
Well, let me say that this sort of atmosphere is not good. It saps our own self-confidence. It also, I think, spoils the image of India. And, therefore, I urge each one of you that, in the reporting of these events, while opinions are a matter of speculation, facts are sacred, facts should not be distorted. One can freely express views which are one’s held convictions, but we owe it to our country that when it comes to reporting the country’s affairs, at least when dealing with the facts, I think they should be as objective as possible.
On governance deficit
I think I don’t deny that we need to improve, I think, the quality of governance. That’s not a subject which divides me and other members of the cabinet.
Biggest regret in second term
Well, I think the big regret is that these irregularities have happened. They should not have happened and that is certainly, I think, given me… I am not very happy about these developments.
The very fact that despite a very unfavourable international economic environment we have managed to ensure that our economy’s growth rhythm is not adversely affected.
Transcribed by Cordelia Jenkins and Malia Politzer.