KARAN
Prime VIP
Reliance Jio got $530 million undue benefit: CAG
Reliance Industries Ltd's telecoms unit got an undue benefit of about $530 million after the Indian government allowed it to offer voice services over wireless broadband spectrum it had won in 2010, the government auditor said on Friday.
The energy-focused Reliance conglomerate, controlled by billionaire Mukesh Ambani, bought the company now known as Reliance Jio in 2010. It is the only firm in the country to have a licence for pan-India broadband wireless airwaves, though it has yet to start commercial services.
However, the auditor said the telecommunications department had allowed the company to migrate from being just an internet service provider to a full services provider at a cost far lower than prevailing market prices. The migration had been allowed at price levels seen in 2001.
The government's lapses resulted "in an undue advantage of 33.67 billion rupees ($528.56 million)" for the unit, Reliance Jio, "due to non-accounting of time value of migration fees," the comptroller and auditor general of India said in a report.
The report also noted that roll out obligations had not been met by the winners of the airwaves, even four years after the auction.
The company, which is expected to launch services later this year, said that no favours had been given to it and that it had acted in accordance to the regulations.
"We have acquired all our spectrum at market prices through open and transparent bidding processes, the conditions for which were same for all bidders," Reliance Jio said in a statement.
Reliance Industries Ltd's telecoms unit got an undue benefit of about $530 million after the Indian government allowed it to offer voice services over wireless broadband spectrum it had won in 2010, the government auditor said on Friday.
The energy-focused Reliance conglomerate, controlled by billionaire Mukesh Ambani, bought the company now known as Reliance Jio in 2010. It is the only firm in the country to have a licence for pan-India broadband wireless airwaves, though it has yet to start commercial services.
However, the auditor said the telecommunications department had allowed the company to migrate from being just an internet service provider to a full services provider at a cost far lower than prevailing market prices. The migration had been allowed at price levels seen in 2001.
The government's lapses resulted "in an undue advantage of 33.67 billion rupees ($528.56 million)" for the unit, Reliance Jio, "due to non-accounting of time value of migration fees," the comptroller and auditor general of India said in a report.
The report also noted that roll out obligations had not been met by the winners of the airwaves, even four years after the auction.
The company, which is expected to launch services later this year, said that no favours had been given to it and that it had acted in accordance to the regulations.
"We have acquired all our spectrum at market prices through open and transparent bidding processes, the conditions for which were same for all bidders," Reliance Jio said in a statement.
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