Indian parliamentary committee may scrap bribe-tainted telecom licenses

Two Indian painters work on a cellular phone billboard in Calcutta. (DESHAKALYAN CHOWDHURY – AFP/Getty Images)

The parliamentary committee charged with investigating the alleged 2G telecom scam may recommend the cancellation of spectrum licenses approved by former minister A. Raja, India's Mail Today newspaper reports.

Quoting sources close to the committee deliberations, the paper says it is likely to advocate making an example of the corporations that allegedly used bribes and shell companies to obtain spectrum licenses at bargain rates–and in some cases, illegally.

In particular, cancelling the licenses could hit Tata Teleservices, the telecom arm of Ratan Tata's multibillion dollar Tata Group, as well as Reliance Telecom, the telecom arm of billionaire Anil Ambani's Reliance Anil Dhirubhai Ambani Group (Reliance ADAG).

Considering that experts have tabbed the losses from allegedly improper allocation of licenses at $13 billion to $39 billion, scrapping the existing licenses and offering the spectrum could cost these existing players billions of dollars — especially considering that they have already committed huge investments in their telecom operations.