In an interview to CNBC-TV18, senior Supreme Court lawyer Harish Salve says there is a pervading sense of gloom among everyone who brings in money and invests in India.
Below is the edited transcript of his interview on CNBC-TV18.
Q: Do you think this auction is going to be a dud, a flop? Will people in the government have to answer for this?
A: It is not a question of people in the government. I think all of us need to answer why India is in such a pathetic condition as we find it today. There is a pervading sense of gloom among everyone who brings in money and invests in India. All those, who enter into a venture in India, are open to attack, vilification. You have created a crazy society, I am sorry to say.
Which corporate is willing to bid? I have clients from the biggest corporates including overseas, nobody wants to put money in India. There is total uncertainty. People don't know. Today people invest, tomorrow somebody else will challenge it on some other ground. So, there is complete uncertainty.
Q: One of the irony is that we cannot ignore, at this point of time, that 2010 and 2008 led to the government actually exceeding revenue expectations and a fall in tariffs and higher competition in the sector, although there are questions on the manner in which that competition was introduced. Despite all that has happened in terms of a new policy over the last two years, today you are left with a situation where the government and the exchequer is not going to garner what they had targeted. Most importantly, customers are going to end up paying for whatever excess is levied on spectrum. Don't you think it's an irony Raja and Behura actually perhaps did more for consumers than what Sibal and Chandrashekhar are doing?
A: We have thrown the baby out with the bath water. It is alleged that Raja took a bribe. It is alleged that he tweaked this in favour of some people. The whole process maybe was started by Raja because he took a bribe or something. At the end of the day, when you sit back on such crucial economic decisions, the government catapulted, there is no other word for it. The government catapulted. They left it to the court.
What can a court do? The court can only say yes or no. Courts don't create clever economic policies. The government should have brought a law under which it should have saved the investments, saved what was good and dealt with Raja separately. Instead of that, the government also merrily went along and said, "We will cancel 122 licenses. We will trash Telenor, we will trash Etisalat." You don't know the problem they have created.
Q: The government clearly even failed to defend the case in the Supreme Court. While you make a distinction between criminality and other things, without prejudice to inviting any problems, isn't it a fact that the court itself went into areas where it perhaps should have avoided and left economic policy making to experts and to the government itself?
A: With great respect, I agree with that. It's very easy for you and me to criticise the judge. I agree with you there has been overreach. When Mr Raja wrote to the Prime Minister saying your suggestion to auction 2G is whimsical and arbitrary. The Prime Minister kept quiet. When the court saw this sight, which red blooded dud would not have reacted? And did the government defend it? How much did the government defend? The government gave the court an impression we sort of believe the whole thing is quite bad. So, the court quashed it.
Now I will tell you what is going to happen. The government, according to me, will have to return money to all the licensees which are cancelled. I hope they can raise in the auction enough money to return to these licensees. You are looking at a huge claim by Sistema. They court missed the detail that Sistema was the only CDMA bidder. It was the only person in the queue, there was no question of jumping the queue. Sistema, today, has not bid. There are no takers for CDMA. We would have had cheap Russian mobile for the poorest Indian which is gone forever.
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