Business Standard

Rao'S Son Involved In Dubious Telecom Deal

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With every big scandal that hits the headlines, one name seems to figure with intriguing regularity "" P V Prabhakar Rao, son of former Prime Minister P V Narasimha Rao.

In the snowballing telecom scandal, Sinclair Electronics, promoted by Prabhakar Rao, figures on the list of suppliers involved in the deals that former communications minister Sukh Ram sought to push through without calling for tenders.

Sinclair was first given an 'educational order' for supplying multi-access rural radio (MARR) systems in 1994. Following this, in a tender that was opened in May 1995, Sinclair was among the companies which received orders for supply of MARR systems early this year.

 

Interestingly, the company figures in the list of companies on which Sukh Ram sought to place 'repeat' orders without going through the tender route. In a note dated April 3 this year, Sukh Ram wanted to order 165 MARR 4/36 systems from Sinclair, costing about Rs 16 crore.

The minister wanted a total of 2,495 such systems (worth some Rs 250 crore) sourced in this particular repeat order. His directive, however, was disregarded by the telecom commission citing the code of conduct guidelines of the election commission.

Prabhakar Rao came under the glare of public scrutiny in 1992 with a loan transaction of Rs 2 crore to Goldstar Steel and Alloys Ltd, a deal which involved Hiten Dalal, a broker accused in the securities scam.

The broker was alleged to have extended the loan to Goldstar to enable the promoters to subscribe to their share of a rights issue of Rs 8.8 crore. Prabhakar Rao was one of the directors in the company.

Early last year, the Central Bureau of Investigation (CBI) exonerated Prabhakar Rao from the episode and the agency's investigations found out that the loan agreement was a direct arrangement between Andhra Bank Financial Services Ltd and Krishna Mohan, one of the co-promoters of Goldstar. The investigations found that Goldstar had nothing to do with the loan extended by Hiten Dalal.

Soon after the former prime minister's son was exonerated of the charges, the department of fertilisers was in the process of clinching a deal with Karsan Ltd, a Turkish firm engaged in tourism, for the supply of two lakh tonnes of urea.

Among others who are alleged to have received pay-offs in the deal include Sambasiva Rao and Sanjeeva Rao, besides Prakash Chandra, son of former fertiliser minister Ram Lakhan Singh Yadav.

Prabhakar Rao is alleged to have purchased benami land in Nampally, with the registration done in the name of Sanjeeva Rao. While Prakash Chandra, Sambasiva Rao, Sanjeeva Rao and officials of National Fertilisers Ltd are cooling their heels at the high security Tihar jail at present, Prabhakar Rao managed to come through unscathed, notwithstanding Sanjeeva Rao's charge that Prabhakar Rao was one of the recipients of the kickbacks.

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First Published: Aug 26 1996 | 12:00 AM IST

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