Tuesday, March 1, 2011

Haha....Kalmadi being accused of a 16 crores scam???! Is there egg on media's face????

Remember what I wrote in my post dated 25th December, 2010? That the size of the CWG scam had been bloated up (or mis-understood) by almost all sections of media? I had also alleged that this was the handiwork of the media....mostly TV news channels to shore up their viewership? Looks like the investigations are proving my point!

My point was that there probably was corruption in the CWG games. That was never in doubt. But the size of the scam was far far smaller. Apparently, the budget that the OC handled was just about Rs 1,600-2,000 crores and I had suggested that between 10-15% of this must have been paid to Kalmadi and Co as bribes. That’s the norm in India and we should recognize this. That would amount to about Rs 200 crores or so. It appears that that’s what is being detected by the investigating agencies in gradual and small steps. Today, the CBI charged Kalmadi with a Rs 16 crores fraud in the tendering of a contract for catering at the games village. Rs 16 crores????! Further, this is not the bribe that Kalmadi allegedly made; this is the total size of the catering order.....so Kalmadi must have made 10-15% or just about Rs 2 crores! Was it really worth all the front pages and 9 pm prime time it got then? Likewise, Kalmadi’s cronies (Bhanot and Verma) have been hauled up for a fraud related to some Swiss logistics company......again the size of the order was Rs 107 crores. So the size of the scam would be around 10-15% or about Rs 15 crores!

Sounds un-exciting? But exactly how much did you think the size of the scam would be? Frankly, I don’t blame us people from being a little disappointed. Media has made a mess of this matter and of course, it won’t apologize. Not only will it not apologize, it won’t even show-case the story on the front page.....because it knows how embarrassing the size of the scam now looks like. Its egg on their face. Let me remind you how media added masala to the story at that time. They always knew that a scam of Rs 200 crores would hardly be worth the effort. It wouldn’t get them TRPs or readership. So they increased the size of the CWG budget to some Rs 70,000 crores and then imputed that the scam must have been much higher. How did they do this? By adding the cost of the new T3 airport, the several flyovers that came up in Delhi, the stadia, the games village....and many more such to make the budget look much bigger. In reality, there were totally different governmental bodies handling each of these things. But the media preferred to suggest that Kalmadi was involved in everything.It had nothing as evidence. Some TV channel sent an ignorant irritating journo to the UK to do some amateur-grade “investigation” and came back with some midget-size so called evidence. And they put it on prime time! They somehow had to get Kalmadi. There was no story of interest in the Games otherwise. How to perk up their ratings in such trying times?! Hence the strategy to scale up the budget and suggest a higher level of corruption. Now the chickens are coming home to roost.

Unfortunately now, no one can blame the CBI. No one can say that the CBI has been asked to go soft on Kalmadi. After all, Kalmadi is every one’s enemy. The CBI is trying its best to nail him. There is no other explanation here.

It’s the same story with the 2G issue (I refuse to call it a scam). The CAG had no business to comment on government policy. That’s clearly the government’s job. The Rs 1.25-1.75 lac figure was intentionally put out to scandalize the government. It’s like the CAG saying that the Defense budget should not be Rs 1.75 lac crores and then randomly multiplying it by a factor of 10 (say....to account for the past Defense spends) and announces it as a Rs 17.5 lac crore spends! It will immediately be given front pages and prime times on media. But honestly, who is the CAG to question government policy? In the 2G case, I have always argued that the government was right in not auctioning the spectrum. Mobile telephony is a “basic” service and the government’s job was rightfully to focus on tele-density instead of revenue maximization. There was a scam in the 2G issue also. The usual 10-15% scam. So if a dozen new entrants were given licenses for a total of some Rs 20,000 crores, then chances are that Raja must have made about Rs 2,000 to 3,000 crores (10-15%). Incidentally, that’s what the CBI is now accusing Raja of. A figure of Rs 2-3,000 crores. Again, nothing’s proven yet. The real sums may be far smaller. We tend to think it’s easy to do so, but in reality it’s quite difficult for corporates to hide so much money away from their books and siphon it out of the country. I personally feel the scam would be of a much smaller order. And it would be in the form of equity stakes given to Raja in a benami name. I doubt if Rs 3,000 crores can be taken out of the country through hawala in this manner.

The real truth is that the scam is within media. That it’s getting very clear now in every case that media sensationalizes matters. That media should apologize. It should apologize not for “un-earthing” the scam.....but for sensationalizing matters so much. They must apologize to their viewers and readers for misleading them in this manner. And for conducting a trial without following any process. They must apologize to Kalmadi for accusing him without evidence. They must apologize. But will they? Impossible. After all, they have a business to protect!


  1. Good to see Prashant Panday, CEO of ENIL, a Times of India group company, take on the media that went hammer and tongs at the CWG and Kalmadi. Interestingly, the two media entities most vocal about the misappropriation of monies were The Times of India and Times Now.

  2. Why the media should appologise . Only media is saving this country. if they dont sensationalise things how cbi and all will come to picture so easily. by adding masala they are only making the case more stronger ,so that it gets everybodys attention. corruption is corruption be it 2 crores or 2000 crores and Kalmadi or any body involving in these scams should be punished heavily. according to you people can make frauds of 2-3 crores and escape easily !! what a gr8 mind you are .