The 2G Spectrum Controversy

How the 2008 allocation of 2G telecom licences on a first-come-first-served basis led to allegations of a huge loss to the government, the 2012 Supreme Court cancellation, and the 2017 acquittals.

In 2008, the government allotted 2G telecom licences and spectrum.

The allocation

Licences were allotted on a first-come-first-served basis at 2001 prices, rather than through auctions.
Some companies received licences and later sold stakes at much higher values.

The CAG estimate

The Comptroller and Auditor General estimated a presumptive loss of up to 1.76 lakh crore rupees, a figure widely debated.

Supreme Court

In February 2012, the Supreme Court cancelled 122 licences, ruling that natural resources should generally be allocated through auctions.

Trials

Politicians and executives were charged.
In December 2017, a special court acquitted all accused, citing lack of evidence; appeals followed.

Lessons

Auctions became the norm for spectrum and other resources.
The case shaped debates on transparency in allocating public resources.

Economic impact

Cancellations disrupted the telecom sector and investment for a time.

The auction shift

After 2012, spectrum was sold through open auctions, raising large sums for the government.

Thinking the 2G case ended in convictions

A special court acquitted the accused in 2017.

Key takeaways

2G licences were allotted first-come-first-served in 2008.
The CAG estimated a presumptive loss of up to 1.76 lakh crore.
The Supreme Court cancelled 122 licences in 2012.
A special court acquitted the accused in 2017.