G Madhavan Nair, former chairman of the Indian Space Research Organisation (ISRO), and three other scientists have been indicted by a government committee set up to investigate a controversial 2005 spectrum leasing deal.
In a report made public on 4…
G Madhavan Nair, former chairman of the Indian Space Research Organisation (ISRO), and three other scientists have been indicted by a government committee set up to investigate a controversial 2005 spectrum leasing deal.
In a report made public on 4 February, the committee, headed by former chief vigilance commissioner Pratyush Sinha, highlighted alleged lapses of judgment on the part of a number of officials, and concluded that there had also been serious violation of norms and a breach of public trust.
It was investigating a transponder agreement signed on 28 January 2005 between local start-up Devas and Antrix, ISRO’s commercial arm. Under this deal, Antrix would lease Devas 90% of the capacity on two S-band satellites that it would build and launch on its behalf for around US$300m.
However, the committee found that Antrix and ISRO, both of which were chaired by Nair at the time, failed to undertake proper procedures in agreeing this deal. It highlighted how at the time Devas had no track record, financial clout or relevant technology to offer.
The fact that Devas was founded about a month before the Antrix deal by ISRO scientists, who also appear to have profited from foreign investment following the spectrum arrangement, also added to the committee’s suspicions.
“For Devas, an internet service provider with a share capital of Rs1 lakh (US$2,029) (about Rs5 lakh (US$10,147) on 31 March 2007 and about Rs18 lakh (US$36,529) on 21 March 2010), with no asset base and no IPR or patent in the relevant technology, and which has been making losses since inception, to collect Rs578 crore (US$117.3m) as share premium from foreign investors, appears to be unusual and can only be attributed to the agreement it had with Antrix,” detailed the report.
“Further, as a result of the increased share valuation, some of the early shareholders including an ex-ISRO scientist and members of the [founding entity] FA-USA team stood to make significant profits while divesting part of their shareholding in 2007-08.”
Following the report, which was submitted to the Indian government on 2 September 2011, Nair has been cited rejecting the accusations, pointing the finger at current ISRO chairman K Radhakrishnan.
Meanwhile, the government is drawing up a revised utilisation plan for the two satellites at the heart of the controversy, Gsat-1 and Gsat-6a, which it says will take “into account the strategic and societal imperatives of the country”.
In a statement corresponding with the release of the committee’s report, the government stated: “If and when the government decides to institute criminal or other charges against any person, that person will be provided appropriate opportunity and due process shall be followed.”
