UPA Government: A Specialist in Scam Management

UPA Government: A Specialist in Scam Management

September 18, 2013

It is ironic that the United Progressive Alliance has completed a decade in power under the leadership of a man hailed for his personal integrity, while the same government will go down in history as the one that presided over the largest number of scams since independence.

For most of the nine years so far in his miracle position, Prime Minister Manmohan Singh has been uniquely protected by an adjectival fortress. Even as his government has steadily imploded into darker and darker scams, even as the economy has slid into seemingly terminal decline, even as, shamefully, the 15th Lok Sabha has clocked the least number of hours in its history, even as the country feels completely adrift and leaderless, Singh personally has remained curiously firewalled behind the idea of him being a decent, upright and erudite man.

Even as the man himself in unwilling to make a comeback if the mandate in 2014 is in his party’s favour, it is opportune to take a look back at the last decade of non-existent governance, financial irregularities and unabashed use of draconian laws to muzzle the voice of the common man.

Here are the five biggest scams that shook India under UPA rule:

2G Scam

The 2G spectrum scam is the biggest scam to have rocked UPA, running simultaneously with the CWG scam. It's estimated to be India's most expensive swindle, and the principal characters include A-listers from the political and corporate world. The basic fact of the scam is that 2G licenses were issued to private telecom players at throwaway prices, flouting rules and regulations, causing a loss of, according to the Comptroller and Auditor General (CAG), of Rs 1,76,000 crore.

It struck roots way back in 2008, when telecom minister A Raja of DMK (a UPA ally), ignoring prudent advice of Telecom Regulatory Authority of India (TRAI), the law ministry and the finance ministry, to auction second-generation or 2G spectrum, allotted licenses on a first-come-first-served basis to help companies he allegedly conspired with. Raja had pegged entry fee for spectrum licenses in 2008 at 2001 prices.

In April 2013, the ball at last landed directly in the PM’s court when, in his 112-page written statement to the JPC, A. Raja said that he personally met Manmohan Singh and P Chidambaram several times between November 2007 and July 2008 — the period when the scam was perpetrated — to keep them informed of all 2G-related decisions, and that the Prime Minister agreed with him on all decisions.

The case is in court and it will hopefully expose the real culprits in due time. In 2011, Time magazine listed the 2G spectrum scam at number two on its ‘Top 10 Abuses of Power’ list (just behind the Watergate scandal).

Commonwealth Games Scam

One of the biggest sporting achievements for India was hosting the Commonwealth Games in October 2010. However, it was marred by allegations of large-scale corruption by the Commonwealth Games Organising Committee, headed by Congress MP from Pune, Suresh Kalmadi, in the months running up to the Games.This was the genesis of what is known as the Commonwealth Games (CWG) scam. The whispers got louder and louder as time progressed. At last, on October 15, 2010, a day after the CWG ended, the government named a high-level committee headed by former Comptroller and Auditor General VK Shunglu to examine matters related to the preparations for the CWG.

CBI came into the picture in November 2010, when it arrested TS Darbari and Sanjay Mohindroo - two former aides of Kalmadi - for their alleged involvement in the Queen's Baton Relay scam.Slowly others started getting caught in the net. Complaints were lodged against former OC Secretary General LalitBhanot and Director General VK Verma. Finally, law caught up with the defiant Suresh Kalmadi. On April 25, 2011, CBI arrested Kalmadifor being involved with financial irregularities during the preparations for the CWG. The next day, on April 26, he was sacked from the post of president of the Indian Olympic Association (IOA).

In August 2013, Kalmadi received another blow as he lost the membership of the powerful Council of the International Association of Athletics Federations (IAAF). Charges continue to be filed against him, with CBI filing one in June 2013 for alleged irregularities in over Rs 70 crore contracts given to Mauritius-based Event Knowledge System (EKS) for venue development and management, games workforce planning and project management services for the CWG.

Coal Scam

The coal blocks allocation scam or coalgate, as it is referred to in the media, is a political scandal concerning the allocation of coal blocks to private sector as well as public sector companies. In March 2012, the CAG’s office accused the government of allocating coal blocks without auction to 142 private and public sector companies between 2004 and 2009, resulting in a "windfall gain" or undue benefits to the allotees, and in turn, a loss, amounting toRs 10.67 lakh crore to the exchequer. The estimated windfall for private operators is about Rs. 2.90 lakh crore based on 2011 coal prices. Over the summer of 2012, the BJP lodged a complaint resulting in a CBI probe into whether the allocation of the coal blocks was in fact influenced by corruption.

In 2004, coal secretary PC Parekh informed the PM of the potential fraud inherent in the discretionary allocation of the captive coal fields and objected to it in writing. Still all the 142 coal blocks were allocated without auction during the time the PM held charge of the coal ministry. The Opposition demanded the resignation of Manmohan Singh alleging that he was using the law ministry to save himself from the probe. The Supreme Court observations on April 30 are undoubtedly harsh. Recently, crucial files relating to the case have gone missing from the coal ministry. The legalities of the case have proved troublesome for Manmohan Singh and the UPA.

Read more about the coal scam in the M3 Leads Archives >>

VVIP Chopper Scam

One of the latest scandals to hit the UPA regime is the helicopter purchase scam. Several Indian politicians and military officials are alleged to have accepted bribes from an Italian helicopter manufacturer, AugustaWestland to enable them to win the deal for supplying 12 helicopters for transporting VVIPs – the president, the prime ministers and other VVIPs. The Rs 3,727-crore contract for the 12 AW-101 helicopters for the Communication Squadron of the Indian Air Force, inked in February 2010, has emerged as a test case for Defence Minister AK Antony, who has built his entire political career on a reputation for honesty.

Controversy over the contract came to light on February 12, 2013, when Giuseppe Orsi, the CEO of Finmeccanica, the parent company of AgustaWestland, was arrested by Italian authorities. On February 13, AK Antony ordered a CBI probe into the contract.

The history of the helicopter deal goes back to March 2002 when the Ministry of Defence (MoD) floated a global tender for procuring 8 helicopters for VVIP travel, as the existing fleet of Russian choppers being used for the same purpose was growing old. While four vendors applied, just one met all the conditions.

At this stage, one crucial condition for selecting the helicopters was changed. Earlier, one of the requirements was that the copters should be able to fly up to an altitude of 6,000 metres. Principal Secretary to PM AtalBihari Vajpayee, Brajesh Mishra, changed that to 4,500 metres, and the mandatory ceiling height was made 1.8metres. The reason given was that VVIPs rarely travel beyond an altitude of 4,500 metres. Four more non-VIP copters were added, for ferrying special protections group (SPG) commandoes. Through this change, it was argued, more companies would be able to participate in the tender. Two were ultimately shortlisted based on the new conditions. Strict penalties were put in the contract against bribery and use of undue influence.

However, despite these measures, giving and receiving of bribes did take place. According to Italian court documents acquired by India, a payment of 51 million euros was allegedly made by AugustaWestland to swing the contract for them. By the time the scandal broke out, three copters had already been delivered. The delivery of the rest was put on hold. India has paid a little over 50% of the total amount.

Nuclear Fuel Scam

It is a scam that can put Coalgate and the 2G scam to shame and earn the tag of ‘mother of all scams’. Investigations by media houses have revealed that the precious nuclear fuel thorium, a naturally occurring radioactive element, to the tune of 60 lakh crore rupees is being squandered in southern India.

Thorium is extracted from monazite, a mineral found in beach sands mainly in the three southern states of Kerala, Tamil Nadu and Karnataka.30% of the world’s thorium reserves are in India. As per the government of India’s department of atomic energy (DAE), no private entity or individual has ever been given permission to process monazite. Indian Rare Earths Limited, a PSU under the Department of Atomic Energy (DAE), is the only organization that can mine it. 

Beach sands might contain other minerals which are allowed to be mined. Any monazite found has to be returned to the DAE. Yet the Tamil Nadu government and the central government have allowed the production and export of the nuclear fuel to continue unabated. The government has allegedly turned a blind eye to private monazite mining, from which thorium is extracted, in the beach sands of Tamil Nadu.

A report published in The Statesman in September 2012 had revealed how the government has failed to control the export of monazite, the raw material from which thorium is extracted, and has allowed 2.1 million tonnes of it to be extracted.

A recent report by the news channel, Times Now has shown how in an agreement between the Tamil Nadu government and a private entity for beach sand mining, monazite was conveniently edited so it could go unnoticed.

Since 1998, when the beach mining sector was opened to private entrepreneurs, nearly 7 crore metric tonnes of beach minerals have been exported, of which 0.20 crore(or 20 lakh) metric tonnes is estimated to be monazite. At 9.3% recovery, the thorium comes to 186,000 tonnes of thorium.

The state governments of Tamil Nadu, Kerala and Andhra Pradesh, where the private mining is allegedly taking places, and the government of India have some tough questions to answer as to how this has been going on for so long. After all, this is a question of energy security, as having one of the largest reserves of thorium should free India from having to import uranium and thus be dependent on the whims of other countries.

Parting thought

Corruption under the UPA Government has taken the shape of a profit-making industry, and the people are disillusioned with those that are at the helm of affairs. The upcoming Lok Sabha polls will be a fight between morality and immorality, and surely the aam admi of India will run a reality check on 'Bharat Nirman'.

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Comments (3)
Anirban Bhaduri Reply
September 20, 2013
Seven years of UPS have only been spent managing scams. Is this why they came to power?
Chandan Mandal Reply
September 20, 2013
This is very well-written, giving all the scams in a tight-knit article. The more the government has tried to hide, the more their scams have tumbled out.
Pinky Mahajan Reply
September 20, 2013
The UPA government should be thrown out immediately. It is simply a bunch a scamsters.
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