Indian 2G Spectrum Scam: Crony Capitalism on Display?

Business Ethics Case Studies|MBA Management Case Studies |Business Ethics Case Study|Ethics Case Studies

ICMR HOME | Case Studies Collection

Case Details:

Case Code : BECG118
Case Length : 23 Pages
Period : 2007-2011
Organization : Companies operating in the Indian telecom sector
Pub Date : 2011
Teaching Note : Available(11 Pages)
Countries : India
Industry : Telecom

To download Indian 2G Spectrum Scam: Crony Capitalism on Display? case study (Case Code: BECG118) click on the button below, and select the case from the list of available cases:

Buy With PayPal

Price:

For delivery in electronic format: Rs. 500 ;
For delivery through Shipping & Handling Charges extra: Rs. 500 +Shipping & Handling Charges extra

»Business Ethics Case Studies
» Case Studies Collection
» ICMR Home
» View Detailed Pricing Info
» How To Order This Case
» Business Case Studies
» Case Studies by Area
» Case Studies by Industry
» Case Studies by Company

Custom Search

Please note:

This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

Chat with us

Please leave your feedback

<< Previous

Introduction cont...

The Government of India (GoI) led by Prime Minister Manmohan Singh found itself faced with corruption charges. It was alleged that the Minister of Communications and Information Technology (MCIT), Andimuthu Raja (Raja), had granted telecom operating licenses and allotted spectrum arbitrarily on a First-Come-First-Served basis, paying no heed to advice from the Prime Minister and other ministries that an open auction be held. Across the world, spectrum, which is treated as a scarce natural resource, is generally auctioned and given to the highest bidders, but in India, the MCIT allocated spectrum to various companies between November 2007 and December 2010 at price levels agreed to in 2001 without any bids being called for. A preliminary

Business Ethics Case Studies | Case Study in Management, Operations, Strategies, Business Ethics, Case Studies

report by the Comptroller and Auditor General of India (CAG)⁶ , a federal agency for auditing public accounts, computed the loss to the exchequer at around US$40 billion (Rs⁷ 1760 billion) due to the MCIT favoring allocation rather than open auctioning⁸. Further, it was also alleged that the MCIT had flouted guidelines and eligibility conditions, altered cut-off dates (for receiving applications), and tweaked procedural conditions, resulting in unfair advantages to certain companies. Following the allegations, Raja was forced to step down from the MCIT and in 2011, was facing corruption charges.

The Supreme Court of India, in December 2010, stated that it was prima facie satisfied that irregularities had been committed in the allocation of 2G⁹ spectrum by Raja. The Court also ordered the Central Bureau of Investigation (CBI)¹⁰ to conduct a comprehensive investigation to bring the wrong-doers to justice.

Excerpts - Next Page>>

6] "2G Scam: Trai Recommends Cancellation of 62 Licences," www.livemint.com, November 18, 2010
7] "TRAI Recommends Cancellation of 69 Telecom Licenses," www.sify.com, November 18, 2010
8] The CAG is the supreme auditor in India. On behalf of Parliament, the CAG checks that public money is collected and expended in accordance with rules and regulations to ensure efficiency in collection and expenditure.
9] Rs. = Indian Rupees. As of 2011, US$1 was approximately equal to Rs. 44.5.
10]"DoT Begins Survey of 2G Scam-Hit Cos," www.businesstoday.intoday.in, November 22, 2010

Custom Search

Business Ethics and Corporate Governance Textbook
Text Book - Rs. 500
Textbooks Collection

Business Ethics and Corporate Governance Workbook
Work Book - Rs. 500
Workbooks Collection

Case Studies in Business Ethics - Vol. I

Case Study Volumes Collection