Mukesh Ambani’s Reliance has paid 1/10th of the Rs 1,76,000 Crores (which was expected from the 2G auctions) to acquire the nationwide 4G spectrum. In the following steps, we with the help of Saaf Baat will explain the chronology of how Reliance Jio 4G Is A Scam.
1. Set Up A Front Company(IBSPL)
Mukesh Ambani’s Reliance Industries Ltd in 2010 bought 95% stake in Infotel Broadband Services Pvt. Ltd (IBSPL). IBSPL was doing fronting for Reliance. It had a paid-up capital of Rs 2.51 crore, a net worth of Rs 2.49 crore, a single client and income around Rs.15 lakh.
2. Auction Of 3G And 4G Spectrum (Bid)
Department of Telecommunications (DOT) had issued a notice in February 2010, inviting applications to participate in the auction of 3G and 4G spectrum. After 117 rounds, the e-auction for broadband wireless access spectrum ended on June 11, 2010. IBSPL was declared as the winner on the afternoon of June 11. It paid 5,000 times its Rs.2.5 crore net worth to win spectrum across India. It also managed to meet the financial requirements for bidders.
3. Reliance Buy The Front Company (IBSPL)
On June 11, IBSPL raised its authorized share capital by 2,000 times, from Rs 3 crore to Rs 6,000 crore by issuing 75% of its shares to Reliance Industries Limited (RIL). Can you believe it on the same day of result declaration? In March 2013, IBSPL was renamed Reliance Jio Infocomm.
4. Changing The Licensing Framework
In a controversial step, in April 2012, the TRAI on the request of the DOT, changed the licensed framework and even replaced it. It means a broadband license converted to Unified Licence “UAS” (for voice service) with help from the government.
On October 21, 2013, Reliance was granted a unified license.
5. CAG Report
The most important thing is that Reliance Jio got a license to provide voice services on its 4G spectrum at 2001 prices. These are the cuttings of the CAG report:
“Reliance Jio Infocomm appeared to have been accorded an undue advantage of Rs.22,848 crores,”
“The government should get the matter investigated even at this juncture, fix responsibilities on the bidders, which violated the auction conditions/rules prescribed and cancel the allotment of the BWA spectrum along with exemplary punishment on the colluding firms.”
6. Why Is There A Silence On This?
This scam is of the bigger magnitude than the 2G scam but the question is who will speak up? Government? If rumors are to believed, BJP spent more than Rs 10,000 Crores on their election campaign in 2014. Who financed all of that?