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Updated: February 6, 2012 02:40 IST

Norms and procedures flouted in Antrix-Devas deal

N. Gopal Raj
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Devas Multimedia Private Limited office at Jayanagar in Bangalore. File photo
The Hindu Devas Multimedia Private Limited office at Jayanagar in Bangalore. File photo

Reports say Space Commission & Cabinet were not told about the deal when their nod was sought for building two satellites

Established norms and procedures that had been followed in India's prestigious space programme were violated in the Antrix-Devas agreement, according to two government-appointed committees that went into details of the deal.

The committees, however, differ on how to apportion blame.

Last year, the government first asked a high-power committee to review the technical, commercial, procedural and financial aspects of the January, 2005 agreement between Antrix Corporation, the marketing wing of the Indian Space Research Organisation (ISRO), and the Bangalore-based private company, Devas Multimedia.

This committee, composed of B.K. Chaturvedi, member of the Planning Commission, and Roddam Narasimha, a distinguished academic and a member of the Space Commission, was also asked to suggest corrective action and fix responsibility for lapses, if any.

The government subsequently constituted a five-member, high-level team, under the chairmanship of the former Central Vigilance Commissioner, Pratyush Sinha. It was tasked to examine the entire decision-making process followed in the deal and identify acts of “omission and commission” by officials.

The reports of the two committees were released late on Saturday night by the ISRO.

The Sinha committee's report has been particularly scathing. It says: “It is very clear that there have been serious lapses of judgment on the part of a number of officials.” In the case of some, “their actions verged on the point of serious violation of norms and breach of public trust.” Others were just “file-pushers and passive onlookers.”

Both committees have noted how the Space Commission and the Union Cabinet were not told about the agreement when their approval was sought for building the GSAT-6 and GSAT- 6A satellites.

In the case of the GSAT-6, which came up for approval in 2005, both bodies were given the impression that Antrix and the Department of Space had been approached by several potential customers, but no agreement had yet been reached, according to the Chaturvedi-Narasimha committee's report. When it came to the GSAT-6A satellite in 2009, only “a very vague statement” was made in the note put up to the Space Commission. When the project proposal for the two satellites came up before the Space Commission for approval, it was important to have mentioned that the bulk of the S-band spectrum available with the Department of Space had been committed to one party. Instead, on both occasions, the Space Commission had been left “completely in the dark.”

Moreover, the amount of spectrum allocated for the Devas project seemed “disproportionately large,” compared with what had reportedly been given for similar services in the U.S., Korea and Japan.

They also observed that when the agreement was made operational in February 2006, the Department of Space did not have funds for building the second satellite. “To sign an agreement committing funds and satellite priority without such a commitment from the Ministry of Finance was not correct. Unfortunately, the Antrix agreement never went before the Space Commission, where the Finance Secretary is a Member. It did not even go to the Union Cabinet, where approval would have entailed commitment for expenditure for the second satellite. Thus, this commitment for building a satellite and the expenditure on it was without any financial authorisation.”

Further, both committees pointed out that the Insat Coordination Committee (ICC), which was established in 1977 for the overall management of the Insat communication satellites, had not met since 2004, and was bypassed when 90 per cent of the capacity on the two custom-built satellites had been allocated to Devas.

The ICC was the body meant for recommending utilisation of satellite capacities by non-government users authorised to provide various telecommunication services. As the matter never went before the ICC, “the Antrix-Devas project was thus a clear violation of government policy.” The capacity allotted to Devas effectively meant that a large part of the S-band spectrum reserved for broadcast satellite services would go to a single private user. That was against the ‘non-exclusive' approach that had been laid as Insat policy, the Chaturvedi-Narasimha committee said.

There was also a national security impact as a result of the transponder allocation to Devas not being cleared by the ICC. The allocation of a large part of the S-band spectrum to the company “was an unjustified risk,” and this issue seemed to have been completely overlooked, their report noted.

Like the Sinha committee, the Chaturvedi-Narasimha committee pointed out that Antrix had signed an agreement with a company whose paid-up capital was Rs. 1 lakh with two shareholders. Antrix and the ISRO had committed an investment of about Rs. 800 crore on two satellites “with a lot of other unusual concessions.” Consequently, “the ISRO was committing large funds for unproven technology and with players who had very little financial stake. Clearly, this was financially weak.”

The choice of Devas seemed to lack transparency and due diligence, the Sinha committee noted. Although the approved regulations governing satellite communications and the ICC's guidelines allowed for leasing of satellite capacity on a ‘first come, first served' basis, this did not prevent Antrix and the ISRO from following a “transparent process of adequately publicising its intent” to such services.

The penalty clauses in the agreement cast a larger responsibility upon the Department of Space. “This was not reasonable from the perspective of the functioning of the Department of Space and the risk they were taking considering the uncertainty inherent in space launches,” said the Chaturvedi-Narasimha committee.

A full chapter in their report was devoted to the reforms now required in the Space Commission and Antrix to meet the growing requirements of space activities. They felt that three officials were “primarily responsible” for the lapses. These individuals, who were identified only by their designation and not by name, were: Chairman of the Antrix Board and Secretary, Department of Space; Director of the SATCOM office at ISRO; and Member (Finance) of the Space Commission. These positions were held at the time by G. Madhavan Nair, A. Bhaskaranarayana, and S.S. Meenakshisundaram.

However, the Sinha committee placed only the first two of these individuals in the category of those “responsible for various acts of commissions,” along with K.R. Sridharamurthi, former Managing Director of Antrix, and K.N. Shankara, former director of the ISRO Satellite Centre. All the four persons in this category, who have retired, were recently barred from holding any official position.

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