ISRO Chairman claims decision to scrap contract was taken in July 2010, admits ISRO did not inform government of exclusive use of two satellites by Devas; PMO claims ‘no revenue loss’

The controversy-ridden S-band deal between the Indian Space Research Oragnisation's commercial arm, Antrix Corporation, and Devas Multimedia Private Limited is heading for annulment, the Government of India indicated on Tuesday.

With the Opposition demanding a probe into allegations that high-value S-band spectrum worth an estimated Rs 2 lakh crore had been made freely available by ISRO to the Bangalore-based private company, the Manmohan Singh government on Tuesday went into damage control mode. Two top space officials were fielded to deny there was any “dilly-dallying'' in terminating the agreement while the Prime Minister's Office issued a statement of double denial. The PMO claimed that “no decision was taken by the Government to allocate space segment using S-band spectrum to Antrix or Devas” and “hence, the question of revenue loss does not arise.”

“The decision to scrap the contract was taken in July 2010 itself by the Space Commission following an internal review by ISRO…currently consultations are on at various levels of the government and a decision on the issue would be taken soon,” K. Radhakrishnan, the ISRO Chairman and Secretary in the Department of Space, told journalists here.

Denying any revenue loss to the government from the use of spectrum, Dr. Radhakrishnan, however, said there was a possibility of financial implications when the deal was annulled. “We will ensure that the government does not incur any damages,” he added.

Asked why the deal, which was highlighted in a detailed expose published in The Hindu and Business Line on Monday, was being scrapped, Dr. Radhakrishnan said the two satellites — GSAT 6 and GSAT 6A — ISRO was planning to launch were primarily intended to be used by Devas Multimedia, a firm headed by former Scientific Secretary at ISRO, M.G. Chandrasekhar. The ISRO chief conceded that Devas Multimedia was to utilise 90 per cent of the capacity of the two satellites that would use 70 MHz of S-band spectrum. However, ISRO later decided that the two satellites and the spectrum were needed to meet India's strategic needs and societal services like education, healthcare, communication, and disaster management.

Dr. Radhakrishnan, who addressed the media along with Planning Commission Member (Science) and former DoS Secretary and ISRO head K. Kasturirangan, admitted that ISRO did not inform the government that the two new satellites were planned for exclusive use of Devas Multimedia. “One point that was not explicitly mentioned [to the Union Cabinet] was that GSAT 6 and GSAT 6A satellites are going to be predominantly used for a novel and commercial application developed by Devas Multimedia in association with global experts,” he said. “Ideally we should have informed the government about it…an internal review is as to why it was not mentioned to the government,” the ISRO Chairman stated, adding that action would be initiated against the guilty.

Asked why no competitive bidding took place for the use of satellite, Dr. Radhakrishnan contended that what Devas Multimedia was developing was a new application and there were no other player. “When the dialogue started with Devas Multimedia in 2003, it was an emerging scenario and a new application was being developed…as there was no other players, hence no bidding.”

Asked whether the Prime Minister was aware of the Antrix-Devas deal, he answered that the contract was finalised by the Antrix Board and he had taken the matter up to the Space Commission. “After the decision [to annul the deal was made],” he disclosed, “I broached the matter with the Prime Minister, who is our Minister in-charge and that is how the PMO issued a press statement today.”

Earlier in the day, the PMO issued the following statement:

“This office has seen reports alleging loss of Government revenue in a contract entered into by Antrix and Devas Multimedia Pvt. Ltd. due to lease of space segment capacity which would use S-band spectrum. The Comptroller and Auditor General's office and the Department of Space have already issued statements stating the factual position on the matter. It is further clarified that no decision has been taken by the Government to allocate space segment using S-band spectrum to Antrix or Devas. Hence, the question of revenue loss does not arise and any such reports are without basis in fact.”

Meanwhile, Union Law Ministry sources told The Hindu that as early as July 2010, the government was advised to terminate the agreement by Additional Solicitor-General Mohan Parasaran.

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