New Delhi: An affidavit was filed on behalf of prime minister Manmohan Singh in the Supreme Court today, in the 2G spectrum allocation case, PTI reports.
In the 11-page written declaration to the Court, the prime minister had rejected the charge of inaction on the part of his office in responding to a request by Janata Party president Subramanium Swamy, seeking sanction to prosecute A Raja, who was sacked as telecommunications minister last weekend after months of pressure from opposition political parties and the media. The affidavit was filed through V Vidyawati, director in the prime minister's office.
The Supreme Court on Tuesday, in a rare step, publicly criticised the prime minister for "alleged inaction", taking 16 months to decide if Mr Raja should be charged. It asked solicitor general Gopal Subramaniam, who was representing the prime minister in the court, to file an affidavit explaining what happened on the matter during these months.
Mr Raja is accused of selling 2G spectrum licences cheaply, causing potential losses of Rs1,70,000 crore to the state, according to a report of the comptroller and auditor general that was tabled in parliament on Monday. Mr Raja has denied the accusations. He is a member of the DMK in Tamil Nadu that has helped give the ruling Congress party a majority in parliament. Opposition parties say Dr Singh failed to act because he feared upsetting his coalition partner.
The 2G scandal is the biggest challenge to Dr Singh (78) since he became prime minister in 2004. Yesterday, attorney general Ghulam E Vahanvati, the country's top legal official, was given the charge to represent the prime minister in the case and he will defend Dr Singh in court when the case resumes on Tuesday. The sudden change suggests increasing concern within the Congress party over the widening scandal that has affected both political and corporate India.
The court cannot punish Dr Singh because no case has been filed against him, but mounting criticism could hurt his credibility. Yesterday, Rahul Gandhi, Congress party general secretary, seen as the prime minister-in-waiting, defended Dr Singh, saying there was no need for him to be embarrassed.
Global cues and institutional outflows were responsible for the Indian market ending lower for the second week in a row. The 2G spectrum allocation scandal, which has rocked the government, was responsible for the sharp plunge on Friday.
Monthly inflation data for September, along with buying on select counters in the post-noon session, perked up the market on Monday. However, deep cuts in the Asian bourses and institutional pressure back home pulled the market over 2% down on Tuesday.
Refreshed after a day's break, the local market opened in the green on Thursday. The 2% easing in food inflation numbers helped in perking up the indices and ensured a positive close on the penultimate trading day of the week. Nervousness ahead of the Chinese government's announcement of a rate hike spooked markets across Asia - India included - on Friday. The domestic market slipped into the red minutes after the opening bell and a feeble recovery attempt in the noon session was scuttled by across-the-board selling, which resulted in the indices closing in the red.
The market closed 3% lower on a weekly basis with the Sensex tumbling 571.45 points and the Nifty down 181.35 points.
The top gainers on the Sensex were Bharti Airtel and Hero Honda (up 7% each). The notable losers during the week included Reliance Communications (down 13%), Reliance Infrastructure (down 10%), Jaiprakash Associates (down 7%), Reliance Industries and DLF (down 6% each).
There were no gainers in the sectoral space this week. The top losers were BSE Realty (down 9%), BSE Consumer Durables (down 7%) and BSE Oil & Gas (down 5%).
The wholesale price index-based inflation fell for the second consecutive month to a nine-month low of 8.58% in October, which together with a slowdown in industrial growth may prompt the Reserve Bank of India (RBI) to halt its monetary tightening stance.
The 0.04% decline in inflation from 8.62% in September is significant, given that inflation stood at just 1.48% in the same month last year. As a result of the low base in September, 2009, the rate of inflation in September, 2010, appears elevated, which is known as the "base effect".
India's merchandise exports shot up by 21.3%, year-on-year, to $18 billion in October this fiscal, while imports grew by 6.8% to $27.7 billion, widening the trade gap to $9.7 billion.
During April-October 2011, exports have aggregated to $121.4 billion, increasing by 26.8% while cumulative imports for the same period went up to $194.2 billion leaving a large trade gap of $72.8 billion.
Food inflation fell sharply by 2 percentage points to 10.3% for the week ended 6th November from 12.3% in the previous week, raising hopes that overall inflation may decline to around 6% by the end of the year, as predicted by the government. Inflation stood at 13.99% in the corresponding period last year.
A slew of international news kept the market on its toes during the week. Japan's GDP rose an annualised 3.9% in the three months ended 30th September, following a revised 1.8% expansion in the previous quarter. The Bank of Korea, for the second time this year, raised interest rates by 0.25 percentage points to 2.5% on Tuesday. Irish central bank Governor Patrick Honohan said he expects the country to go in for a bailout from the European Union (EU) and the International Monetary Fund (IMF) to rescue its beleaguered banks. Ireland is likely pay an interest rate of nearly 5%, similar to that offered to Greece when it requested a bailout in April. The Chinese central bank on Friday raised the deposit reserve ratio for the fifth time this year and the latest hike is the second one in November. The People's Bank of China said the deposit reserve ratio has been further hiked by 50 basis points effective 29th November.
Back home, the Comptroller and Auditor General (CAG) has indicted former telecom minister A Raja for ignoring the advice of the prime minister, finance and law ministries to allocate second generation (2G) spectrum to new players in 2008 causing a whopping revenue loss of over Rs1.76 lakh crore.
In the report, tabled in both houses of Parliament on Tuesday, the CAG noted that the ministry of communication and IT "decided to go ahead with arbitrarily deciding that the cut-off date for issuance of Letters of Intent would be advanced to 25 September 2007 and applications received would be decided on FCFS (first-come first-served) basis."
Leading macroeconomic research agency Centre for Monitoring Indian Economy (CMIE) has forecast capital flows topping $91 billion by the end of the fiscal, a staggering 70% over the $53.6 billion that the country received in the last fiscal.
The agency's monthly macroeconomic report says this record spike is on the back of the massive inflow of $30.4 billion in the September quarter alone. For the foreign funds looking for high returns on the back of dirt-cheap funds from their home markets where returns are negligible, India-and especially its stock markets-has been a hot destination.
India's foreign exchange reserves slid by $1.9 billion to $298.31 billion on the back of a heavy decline in foreign currency. The total forex kitty had crossed the $300 billion mark for the first time since 2008 last week and stood at $300.21 billion.
Foreign currency assets, a major component of the forex kitty, were down by nearly $1.8 billion to $269.49 billion for the week ended 12th November, according to RBI data.
While global cues will provide direction to the domestic market next week, the political events following the telecom scandal will also have a say in the movement of the indices.
New Delhi: Prime Minister Manmohan Singh today promised action against anybody for any "wrong thing" done in the 2G spectrum allocation. Mr Singh also appealed to all political parties to allow parliament to function, and said that the government would discuss all the issues.
"There should be no doubt in anybody's mind that if any wrong thing has been done by anybody, he or she will be brought to book," the prime minister said in his first comments on the 2G issue that has paralysed parliament since the winter session began a fortnight ago. Dr Singh was replying to questions after a 23-minute speech on "Winning the next decade", at the HT Leadership Summit in the national capital, PTI reports.
The prime minister said that various aspects of the 2G spectrum allocation are being looked into by respective investigating agencies "in the domain of their interest". Then he added, "But for all these to happen, in a democracy we have to allow parliament to function... We are ready to discuss all issues. We are not afraid of discussions."
"I appeal to all political parties to let parliament to do its work. We need parliament to function more regularly to pass legislations, laws and supplementary demands for grants for various departments," Dr Singh said. "It is my humble request to all political parties to allow parliament to function. We can discuss everything."
While appealing to political parties to co-operate, the prime minister said that in a democracy there was need for "reasoned debate" to raise "nationally-acceptable" approaches. He desisted from going into details on the 2G issue, saying that parliament is in session. He did not comment on a rare demand by the Supreme Court to explain why he had failed to probe what could potentially emerge as the country's biggest corruption scam.
On the theme "Winning the next decade", Dr Singh mentioned the story about the hare and the tortoise, saying that one could choose to describe India as a hare, tortoise, or elephant, or whatever, But "the simple truth is that India is a nation of over a billion people eager to realise their destiny". The prime minister said that there is "no magic formula" or "magic wand", but the government has a lot to do to make this happen, and what it does must be innovative and must spur innovation.
The prime minister said the country must also address new challenges like the threat to the environment arising from inadequate regulation. "We need new thinking to prevent the degradation of land and water resources which endanger the livelihood of millions of our people living on the edges of subsistence," Dr Singh said.
He said that it is on the foundation of a better educated, more healthy and more skilled people that India must build its edifice of a more entrepreneurial society and leverage capacity for innovation. "The greatest battles of our times are not ones in which humans will win over humans, or a nation over a nation. The greatest tests of our times are ones in which humanity as a whole will have to fight and win together-these will be our collective fight against hunger, poverty, terrorism, disease, tyranny, corruption, bigotry and extremism," the prime minister said.