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All about the Antrix-Devas deal and other related scams

analysis Updated: Aug 13, 2016 08:29 IST

In January 2005, Antrix and Devas finalised the deal in principle to provide 70 MHz of S-band satellite spectrum to Devas for providing multimedia services

Unfortunate is hardly the word for what’s happening to the Indian Space Research Organisation (Isro), which is suddenly making headlines for all the wrong reasons as it stares at one of its worst ever crises. In a charge-sheet filed on Thursday, the Central Bureau of Investigation (CBI) has reportedly accused former ISRO chairman G Madhavan Nair and other senior officials of misusing Antrix — Isro’s commercial arm — to facilitate an undue gain of ₹578 crore to Devas, a Bengaluru-based multi-media company in which they apparently had vested interests. This follows close on the heels of an international tribunal slapping a multi-million dollar penalty on Antrix after it lost an arbitration case over scrapping the Devas deal.

Read| Isro ex-bosses named in CBI’s Antrix-Devas deal charge sheet

In January 2005, Antrix and Devas finalised the deal in principle to provide 70 MHz of S-band satellite spectrum to Devas for providing multimedia services. The CBI contends that Antrix delayed signing the compact so that two of the accused, who represented a US company at the time, could become majority stakeholders in Devas. This, the CBI points out, violated the Shankara Committee recommendations that Antrix could enter into such an agreement only with an Indian entity. Antrix, say investigators, never bothered to verify this. From all accounts, Devas eventually sold its shares at a huge premium and even offloaded them to the German telecom giant, Deutsche Telekom and other investors, including some former Isro scientists in 2008. As it happened, however, a leaked comptroller and auditor general report in 2011 exposed these irregularities, forcing New Delhi to hurriedly scrap the deal citing “national security” issues. Never mind if the use of the S-band — other than in World War II radars — was always sketchy, thanks to its high failure rate during rains that interfere with the signal.

Read | Devas deal: The government acted within its rights

But the controversy kept snowballing, with the surfacing of some allegations even hinting darkly at a witch-hunt by the top echelons of the space agency at the time. It turns out Deutsche Telekom, invested more than $100 million in the deal under an Indo-German Bilateral Investment Treaties (BITs). Under international law, BITs can sue host states for treaty violations, and so the Germans lost no time in claiming a whopping $8 billion in damages from India for cancelling the deal.

Read| India loses Antrix-Devas arbitration case, may have to pay $1bn compensation

It may be cold comfort for Isro, but space agencies across the world are not always insulated from the scams, scandals and intrigues that swirl around them. It is too soon to forget how, in 2010, Nasa administrator Charles Bolden was accused of trying to sabotage Nasa’s ground-breaking Offshore Membrane Enclosure for Growing Algae (OMEGA) project. The allegation was that he held a million-dollar stock in Marathon Oil, a company with a competing biofuels project. Bolden was eventually absolved after an internal Nasa investigation found nothing in the allegations. In February 2014, Italian Space Agency (ASI) chief Enrico Saggese had to resign in the face of alleged irregularities in the award of contracts by the agency. And just last year Russia’s deputy prime minister Dmitry Rogozin openly blamed corruption in that country’s space industry for the recent spike in accidents involving Russian spacecraft. The state company producing Proton rockets for the Russian space agency Roscosmos currently faces a dozen criminal cases.

Read| India to appeal against Hague tribunal’s verdict on Antrix-Devas deal

This is not the first time Isro is weathering a scandal, and it won’t be the last either. The space agency would do well to leave it to the investigators to sort out the corruption mess and its leadership stay dedicated towards what it does best: Space exploration. With some exciting projects on the horizon — including the country’s second Moonshot and, later, the follow-up mission to Mars — Isro can’t afford to shift its focus.

Prakash Chandra is a science writer. The views expressed are personal