India's former telecommunications minister A Raja has been arrested in connection with an alleged multi-billion dollar corruption scandal.
Mr Raja, who has denied any wrongdoing, was forced to quit in November over the sale of mobile telephone licences for a fraction of their value.
Ex-telecommunications secretary Siddharth Behuria and Mr Raja's aide RK Chandolia have also been held.
Mr Raja belongs to the DMK party, an ally of the ruling Congress government.
A DMK spokesman said Mr Raja's arrest would not affect the party's ties with the Congress.
The arrests were made in the capital, Delhi, by the federal investigation agency, the Central Bureau of Investigation (CBI).
According to the national auditor, the so-called 2G spectrum phone licences were sold in 2008 for a fraction of their value, costing the government $37bn (£23bn) in lost revenue.
Mr Raja is accused of issuing the 2G licences on a "first-come, first-served" basis instead of auctioning them.
Critics said the low return was underscored when India's auction in May last year of 3G bandwidth for mobile phone services ended up reaping $15bn, twice the sum expected.
Mr Raja presided over the world's fastest growing mobile market - there are about half a billion mobile phone subscribers in India.
The 2G spectrum scandal has prompted the most serious political stand-off in recent times in India.
The winter session of parliament was deadlocked over opposition demands for a major inquiry.
India has seen a slew of high-profile corruption investigations in recent months.
Organisers of the Delhi Commonwealth Games are accused of swindling millions of dollars during the October event.
The Congress party in November ordered the chief minister of the western state of Maharashtra to quit over his alleged role in a scam involving homes meant for war widows being given to relatives and bureaucrats.