The Andhra Pradesh government on Sunday decided to entrust the investigation into the alleged irregularities in AP State FiberNet Limited to the Crime Investigation Department (CID) as the Central Bureau of Investigation (CBI) is seemingly reluctant to proceed with it. In June last year, the state cabinet had decided to entrust the probe to the CBI and a confidential order was issued on July 13, according consent to the national agency to exercise powers and jurisdiction "for taking up regular investigation and follow up action pertaining to the scam in APSFL."
Subsequently, letters were written to the Union government and Chief Minister Y S Jagan Mohan Reddy personally took up the issue with Union Home Minister Amit Shah. However, with the case making no progress, Energy Secretary Srikant Nagulapalli issued a formal order on Sunday, directing the Additional Director General of CID to investigate the irregularities and submit a detailed report to the government.
On June 11, 2020, the state cabinet decided to order a probe by the CBI, based on the preliminary inquiry by a Cabinet Sub-Committee, into various "financial scandals" committed by the previous Chandrababu Naidu regime in different schemes, causing an alleged loss running into several hundred crore. The Union government initially provided a financial assistance of Rs 3,840 crore for the FiberNet project under the National Optic Fibre Network.
In the project, which was meant to provide internet and telephone services to all households, costs were allegedly inflated by at least Rs 700 crore, the Cabinet Sub-Committee, headed by Finance Minister Buggana Rajendranath stated. Also, inferior quality Set Top Boxes were purchased from different companies, sidestepping the lowest bidder (a South Korean firm) that came forward to supply high-end STBs at a lower price, it said.
"This alone cost hundreds of crores of rupees to the exchequer while the project remained unaccomplished," the Cabinet Sub-Committee said. It said that various lapses and favoritism were exhibited by the concerned people in power, in awarding contracts to the ineligible and in favour of the contractor who was not the lowest bidder.
"Tender conditions were relaxed to facilitate the award of work to one particular company, though the Central Public Sector Enterprise, Telecommunication Consultants India, emerged as the lowest bidder. It was not considered for 'Project Monitoring Authority' on inadequate grounds even though the firm quoted a lesser price, but instead APSFL chose to call for fresh bids. Non-selection of TCIL was due to the fear that the Central PSE would expose the compromised tender conditions to favour one particular company. Hence the decision to seek a CBI inquiry to unearth the massive irregularities," the state had then said, while seeking the central agency’s probe.
Meanwhile, the Andhra Pradesh government also ordered a probe by the CID into the alleged siphoning of public funds by some companies in the name of setting up skill development clusters in the state. Skill Development and Training Department Principal Secretary G Jayalakshmi issued a memo to this effect and directed the Additional Director General of CID to investigate the matter in detail and do the needful in accordance with law. The Principal Secretary said a forensic audit ordered by the AP State Skill Development Corporation concluded that two companies diverted funds to the tune of Rs 241.78 crore through various shell companies.
The report also revealed that the two companies utilised only the government contribution of Rs 370.78 crore in contravention of the original scheme, wherein six clusters of skill development centres, centres of excellence and technical skill development institutions were supposed to be set up. Each cluster was supposed to cost Rs 546.84 crore, with 10% of it being the state government contribution.
"It has been brought to the notice of the government by the central government agencies that a network of companies siphoned off funds from APSSDC through a bogus invoicing scheme pertaining to the project," Jayalakshmi said. The state government, hence, decided to entrust the case investigation to CID, she added.