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Coal scam loss figure too will prove mythical: FM

Coal scam loss figure too will prove mythical: FM
After terming CAG’s estimate of Rs 1.76 lakh crore loss in 2G spectrum allocation as a ‘myth’, Finance Minister P Chidambaram on Sunday said the projected Rs 1.86 lakh crore loss in coal blocks allocation would also turn out to be a ‘mythical’ and ‘fancy’ number.

Fresh from the just-concluded auction of 2G mobile phone airwaves that tested if the government could actually get what the official auditor had projected as loss from allocating the spectrum on first-come-first-serve basis, Chidambaram said the loss estimated in coal block allocation was ‘another fancy number’.

‘One (well respected) business house told me that they were allotted a coal block some seven-eight years ago. (But) he has not been able to enter that area yet for a variety of reasons. His officers (have) not entered the area yet. Now what’s the point in saying that some loss is there. What is the loss?,’ he asked.

‘Yes, if there is any irregularity in allocating the block then that’s a different matter. But where is the loss,’ he asked.

CAG, which had in 2010 estimated that the exchequer lost Rs 1.76 lakh crore in revenue because the then Telecom Minister A Raja allocated spectrum along with mobile permits to 9 telecom companies without bidding, this year estimated a loss of Rs 1.86 lakh crore in allocation of coal blocks since 2004.

‘Ultimately that number which is being put out in the coal scam would also turn out to be mythical number,’ he told PTI in an interview.

Chidambaram was, however, quick to say there was ‘no sense of vindication or celebration’ in the government over last week’s 2G spectrum auction failure.

‘Nobody feels vindicated, nobody is celebrating anything.

All that we have pointed out is that Rs 1.76 lakh crore was a pure myth and I think everybody has candidly admitted that they bought this myth, we never bought this myth,’ he said.

The government, which had set a reserve price of Rs 14,000 crore for pan-India spectrum on the basis of CAG’s assumption in calculating the loss in the previous sale in 2008, managed a meagre Rs 9,407.64 crore in the auction that lasted barely two days.

‘(From) day one, the minister concerned (Kapil Sibal) has said this number is a mythical number... it has no relation to the alleged loss. Now this auction reveals that this number has no relevance,’ Chidambaram said. ‘That’s all this auction has revealed.’

The recent auction for 1800 MHz band got total bids worth Rs 9,407.64 crore, just one-third of the minimum Rs 28,000 crore that the government had expected. The auction was a far cry from the 35-day bidding for the 3G spectrum in 2010 that got Rs 67,719 crore.

However, Chidambaram expressed confidence of meeting the Rs 40,000 crore revenue target from sale of spectrum as the ‘auction process is not (yet) complete.’

Chidambaram said the government has more spectrum to auction.

‘There are four GSM circles (that got no bids in the recent auction), CDMA (band spectrum), 900 MHz, spectrum refarming and the spectrum available is likely to be auctioned by 31 March,’ he said.
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