5G Scam Is The Biggest In Indian History: 5G Sold For Lesser Than The Construed Loss In 2G, After 12 Years In A Booming Telecom Market, More Acche Din To Come.
Some of India’s richest tycoons are being drawn into the fight for the fifth-generation airwaves, and billionaires like Mukesh Ambani and Gautam Adani are going to join a host of other parties offering up to $14 billion for frequency rights that might determine who dominates the digital era.
As Asia’s third-largest economy auctions its airwaves to provide the newest technology to its more than 1.3 billion residents, the competition to deploy fifth-generation (5G) telecoms services is heating up in India.
India’s digital sector is anticipated to grow when the introduction of fifth-generation technology, which can be up to 10 times quicker than 4G.
Bidding for 5G is heating up among Indian telecom players with deep pockets.
Several factors are at play, and a large investment is required to build additional infrastructure so the service can take off.
According to Deloitte India partner and telecoms sector leader Peeyush Vaish, “We’re now one step closer to getting access to the fifth generation network.” The country’s major telcos take part in the ongoing 5G spectrum auctions. It is anticipated to transform the Indian telecommunications industry dramatically.
The sale commenced on July 26. The government said on Saturday that there had been bids totalling 149.85 billion Indian rupees ($18.9 billion) for the process.
Reliance Industries Jio, the telecom business headed by Mukesh Ambani, India’s richest man, is leading the way.
Competitors Bharti Airtel and Vodafone Idea have also submitted bids, while Adani Enterprises, owned by billionaire Gautam Adani, has also done so.
The unexpected entry of Adani Data Networks, which has expressed interest in purchasing airwaves for a private network, has sparked the public’s curiosity.
Second-richest individual in the nation, Mr Adani, is now directly competing with Mr Ambani for the same asset.
These businesses have “tremendous interest” in the 5G auction due to its role in all business sectors, from agriculture to energy.
Could this be a Jio moment for the enterprise telecom industry, where a new entrant with deep pockets, competitive advantages, and innovative technology ends up capturing a significant portion of the pie?
2G ‘scam’ and A Raja
During the UPA government, allegations over the allocation of coal blocks and the 2G spectrum significantly influenced Indian politics. The second UPA government suffered greatly as a result of the CAG reports.
The CAG Vinod Rai estimated a presumptive loss to the exchequer of Rs 1.76 lakh crore as a result of the 2G spectrum being allocated without an auction in November 2010. While the government didn’t technically lose anything, if the 2G spectrum had been put up for sale, the exchequer was expected to gain Rs. 1.76 lakh crore.
It is interesting to note that CAG estimated the assumed loss in the 2G auction to be between Rs 58,000 crore and Rs 1.76 lakh crore, yet the largest figure was only mentioned in the media and stuck in people’s minds.
One of the defendants was A Raja, who was the telecom minister at the time. In exchange for bribes to benefit specific telecom businesses, he was accused of changing the first-come, first-served rule by moving the deadline for applications to be given spectrum.
Raja also served time in jail for committing the crime. But in 2017, A Raja and the other defendants in the case were brought before a special court. The court ruled that the case was without merit and had been fabricated by substantially inflating the truth. The CBI had filed an appeal with the Delhi High Court challenging the ruling, but the high court earlier this year denied the petition.
A Raja, a former telecom minister, demands an investigation into the $5 billion 5G spectrum auction.
Former CAG claimed that the 2G auction resulted in a loss of Rs. 1.76 lakh crore in 2010. However, the current 5G bids are lower than that. The former Telecom Minister called this a big scam.
A total of Rs 1.5 lakh crore worth of bids were submitted for the recently ended 5G auction, with Mukesh Ambani’s Jio winning over half of the airwaves sold with an offer of Rs 88,078 crore.
Vinod Rai, a former C&AG, damaged India’s reputation in November 2010 by asserting that there was a notional loss of 1.76 lakh crores in the allotment of the 2-G spectrum.
For the far superior 5-G technology 12 years later, the government could only secure 1.5 lakh crores in the auction. It seems like the government is concerned about his friends that prompted him to sell the 5G at a lesser amount than 2G.
The BJP‘s alleged 5G scandal is the biggest scam in Indian history.
If the 2G spectrum, which is mostly used for voice and text, was worth Rs.1.76 lakh crores, how can the 5G spectrum, which powers applications such as linked automobiles, remote surgery, augmented reality, and meta, be 1.5 lakh crores when it had an auction worth 4.3 lakh crores?
Because the government fixed the base price of 5G spectrum at Rs 4.3 lakh crores but only received Rs 1.5 crore from the auction, there are claims that there was a scam.
Similar comparisons have been made to the alleged “2G scam” in 2008, which the Supreme Court determined was not a scam. In that case, the UPA government collected 176,000 lakh crores for the 2G auction in 2008, and in 2022, the BJP government should have collected 400,000 lakh crores for 5G rather than the 150,000 lakh crores it did.
The public is accusing the government of conducting a massive scam, dubbed “the biggest in Indian history,” in connection with the 5G auction, which is really the largest spectrum auction in India, lasting seven days and netting more than 1.5 lakh crores.
Following this auction, the Modi government is being accused of major misconduct on social media, with the hashtag #5G Scam Bjp currently trending at the top. Some claim that the auction was fake and that everything was predetermined.
During the 7-day 5G spectrum auction, which ended on August 1, billionaire industrialist Mukesh Ambani’s company Jio made the highest bid.
He bought nearly half of the total spectrum by bidding for Rs 88,078 crores. It seems like the government is doing its best to help his friends so they can take over the entire telecom sector.
The Adani Group purchased a 400 MHz spectrum for Rs 212 crore, according to Telecom Minister Ashwini Vaishnav. Spectrum in many bands, including the 700 MHz band, has been purchased by Jio. The 26 MHz bands of the spectrum have been purchased by Adani Group.
Adani does not own any telecom company. Then what is he going to do with the 5g spectrum? Isn’t it because whoever holds the entire telecom sector would get to control the entire people’s choices? Reminding everyone that the #5gScam is the BJP’s gift to the country on Independence Day.
The BJP’s recent scams include the NSE Scam (worth 5 lakhs crores), the Bitcoin Scam (worth 40000 crores), and the 5G Scam (worth 2.8 lakhs crores), but who is willing to question them?
In 2010, the BJP alleged that the 2G spectrum was a scam. According to the CAG, the scam resulted in a presumed loss of Rs 1.76 lakh crore. A Delhi court cleared every defendant in 2017. According to the court, the CBI utterly failed to establish the charges.
The opposition is claiming that the 5G spectrum auction is a con. The government disputed the allegation, which maintains that just a fraction of the spectrum has been sold. The opposition asks how superior technology can be sold for a low amount (Rs 1.50 lakh crore).
How come 5G, the superior technology being sold for less than the presumptive loss amount you quoted in 2G? Where has the money gone?
In 2019, when the 5G spectrum sale was planned, it was estimated that exactly for the portion that has been sold, about Rs 6 lakh crore would be raised. India is almost operating as a duopoly in the telecom industry. Where is the blooming telecom industry? Why has it contracted?
Ex-Telecom Minister Raja on the 5G Spectrum Sale: “Where Has the Money Gone?”
Raja, a former telecom minister who had accused the recently concluded 5G spectrum auctions of being a “massive scam,” questioned, “Where has the money gone?” in light of the large disparity between auction proceeds (Rs. 1.5 lakh crore) and estimated sales proceeds (Rs 5 lakh crore).
On Thursday, he told reporters in Chennai that the government had predicted that 5G would bring in up to 5 lakh crore. However, the 5G auction price was merely 1.5 lakh crore.
“When you search on the internet, you will receive results in 10 seconds when using 2G, 5 seconds when using 4G, and one second when using 5G. Such is the effectiveness of 5G. The 5G auction should have drawn bids worth at least Rs 5 to 6 lakh crore, according to comparisons of the statistics based on this efficiency.
We don’t know if the planning or estimation was flawed, if they simply plucked these figures from the air, or if the Union government partnered with particular corporate companies to carry out this scam. The former telecom minister had stated that all of this needed to be looked at right now.
Will Adani’s Entry Into the 5G Spectrum Race Change the Telecom Equation in India?
Brokerages claim that the Adani Group’s involvement in the spectrum auction will intensify competitiveness in the enterprise 5G market and the forthcoming auctions.
BofA Securities stated in a report regarding the Adani Group’s intentions to participate in the 5G auctions, “We consider this news flow negative for incumbent telecoms as it boosts competition in the next auction bidding as well as in the long-term chance to target the enterprise area.”
According to brokerage firm CLSA, Adani’s involvement will raise questions about spectrum pricing in the 5G auctions.
Why would Adani bid in an auction versus awaiting a direct spectrum assignment?
While telcos offer enterprise services that address cybersecurity, big data, and data centres, the consumer mobility market focuses on offering telecom services like broadband, wifi, and mobile recharge.
The bid will likely assist the Adani Group in capturing India’s rapidly rising data technology industry. The global market for big data technologies is anticipated to reach $116.07 billion by 2027, growing at a CAGR of 14% during the forecast period, according to a report by Fortune Business Insights.
India’s telecom sector has almost reduced to a duopoly, with Vodafone having to go to the government and do a rescue act. Where is the vibrant telecom sector? Why has the telecom sector shrunk? Where are the 1-13 operators?
Why did not a single foreign operator think 5g telecom in a moving market, supposedly moving market like India, is a great option to put their money in? The government is not going to answer such questions. But these need to be asked. Surprisingly, 1.5 lakh crore that has been collected by selling 5g airwaves is proof of how the vibrant telecom market has just reduced a duopoly.