What the PMO claims and what the facts are

The Hindu

New Delhi, 09 February 2011: The Prime Minister’s Office (PMO) on Tuesday said in a brief statement that it had not taken any decision to allocate ‘space segment’ (wireless radio frequency under the control of the Department of Space) in the S-band spectrum to Antrix Corporation or Devas Multimedia Private Limited. The statement claimed that the question of any revenue loss did not arise; reports to that effect were without basis in fact.

 

The PMO was responding to reports that appeared in The Hindu and Business Line on Monday, and in other media outlets on Tuesday, which referred to the contract entered into between Antrix, the commercial arm of ISRO, and the Bangalore-based Devas engaged in developing multimedia and information services via satellites.

 

The reports had pointed out that the equivalent of about Rs. 500 crore for which the agreement for the lease of transponder capacity was entered into was grossly short of what the initial estimates from the audit carried out by the Office of the Comptroller and Auditor General had suggested.

 

The 3G auction of radio frequencies available with the Department of Telecommunications had offered a clear benchmark. But an analysis of the Antrix-Devas agreement throws up pointers that are at variance with the contention of the PMO.

 

According to the terms of contract made in January 2005, Antrix represented that it has the power to enter into and perform this Agreement (the agreement to deliver space segment communication capacity). The contract was to deliver to Devas a leased capacity on the primary satellite, five transponders of 8.1 MHz each and another five transponders of 2.7 MHz capacity, within a period of 36 months (including a grace period of six months).

 

In satellite communications the grant of transponder is tantamount to allocation of spectrum, as they are designed to work at specific frequency bands. In this case, as and when the transponders are allotted in the S-Band, it follows that spectrum in the 2500 MHz band would be allotted. This is akin to the way DTH operators are given transponders for broadcasting.

 

When a Tata Sky, Dish TV or other DTH operator is offered a transponder, it is essentially offered frequency in the Ku band, which is a different set of radio frequencies.

 

Termination clause

The Government has also contended that there is no revenue loss from the legal arrangement between Antrix and the private company. The extent of revenue foregone may be open to interpretation.

 

However, for the government to contend that there is no financial loss whatsoever is clearly at variance with the financial penalties that Antrix is liable to pay out, and hence, by extension, the government, for any default in the timely delivery of promised transponder capacities.