RBI's Subbarao says 2G not a 'scam'

Subbarao

RBI Governor D Subbarao today appeared before a Parliamentary panel inquiring into the 2G spectrum allocation 'scam' and said he did not agree with the controversial Finance Ministry note which suggested that Finance Minister P Chidambaram could have insisted on auctioning the spectrum.

He also rejected suggestions that allocation of radiowaves resulted in a loss virtually brushing aside the 2G scam case.

Subbarao, who appeared before JPC on 2G scam as a former Finance Secretary, told the panel that he was in disagreement with the March 25, 2011 note of the Finance Ministry to the Prime Minister which suggested that Chidambaram could have insisted on auctioning the 2G spectrum instead of it being allowed to be allocated on first-come first-served basis.

Chidambaram said in a meeting with then Telecom Minister A Raja on January 30, 2008 that "he was for now not seeking to revisit the current regimes for entry fee or revenue share" of spectrum, the note said.

When asked about the issue of loss incurred by not auctioning the spectrum, Subbarao - who was Finance Secretary between April 30, 2007 and September 4, 2008 - is learnt to have said that while there was no loss to the exchequer, even if there was, it was only notional in nature. He said there was no monetary loss in actual terms.

"Much depends on perception," he is learnt to have told the JPC.

He is also understood to have said that there was no deliberate delay on his part in responding to a Department of Telecom letter of November 29, 2007 in which he was informed that the entry fee was finalised for the unified access regime in 2003 based on the decision of the Cabinet.

He said he had appraised the Finance Minister about the letter on January 9, 2008 - a day before the licences were allocated.

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