The latest scam has allegedly caused the exchequer a loss in excess of Rs. 2 lakh crore
The controversy this time is over the high-value and rare S-band spectrum and the allegation is that a private company has been given the high-value bandwidth at thro throwaway prices without competitive bidding by the Indian Space Research Organisation or the ISRO.
Here too the Comptroller and Auditor General (CAG) has started probe into the alleged deal.
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The story revealed by the Hindu Business line says that Auditor General (CAG) has started probe into a 2005 agreement between the ISRO’s commercial arm Antrix Corporation Ltd. and Devas Multimedia Private Ltd.
The paper said that the agreement relates to ISRO’s launching of two satellites for Devas but automatically bestows on the latter a large hidden benefit: unbridled use of 70 MHz of the scarce S-band spectrum over a 20-year period.
ISRO is under the Department of Space (DoS), which is directly in the Prime Minister’s charge.
The department of space in statement today said that the Agreement entered into by Antrix, the commercial arm of ISRO, and M/s. Devas on January 28, 2005 is already under review by the Department. It said that the government would take whatever steps are necessary to safeguard public interest.
A decision on the matter is likely to be taken soon.
Earlier the CAG has clarified in a that the audit of the Department of Space is under way and that only preliminary queries have been raised on the matter.
According to the paper the preliminary CAG estimates shows that this spectrum largesse to a private customer could have caused the exchequer a loss in excess of Rs. 2 lakh crore. According to the contract with Devas, Antrix would have earned $11 million a year per satellite for 12 years.
By comparison, the presumptive loss incurred in the allocation of 2G spectrum by the DoT, as estimated by the CAG, is Rs 1.76 lakh crore.
Under the deal, Devas Multimedia is to get access to 70 Mhz of broadband spectrum in the 2500 Mhz band. This was once used by Doordarshan to deliver programmes by satellite to all parts of the country but is now considered to be of enormous commercial value for high-speed, terrestrial mobile communications. In 2010, the Union government got nearly Rs. 67,719 crore from the auction of just 15 Mhz of similar airwaves for 3G mobile services.
Devas Multimedia is a company in which Deutsche Telekom is a minority equity stakeholder. Dr. M.G. Chandrasekhar, Devas Multimedia Chairman, is a former Scientific Secretary at ISRO.
According to the contract, Devas Multimedia is entitled to get a total of 70 Mhz of the S-band spectrum on lease for 20 years. The contract requires ISRO to build and launch two communications satellites — GSAT-6 and GSAT-6A — at a further cost of Rs 2,000 crore. Devas Multimedia will get to use 10 transponders on each of the satellites.
The contract, unlike others ISRO has signed in the past, places no restrictions on Devas Multimedia for onward lease of spectrum.
It is the first time the S-band, which ranges from 2500 to 2690 Mhz, has been opened up to the private sector. And this has been done silently.
The S-band spectrum, which is part of the Devas-ISRO deal, is extremely valuable for mobile broadband services, in terms of usage as well as money. The frequency, also known as 2.5 Ghz band, is globally used for providing mobile broadband services using fourth generation technologies such as WiMax and Long Term Evolution (LTE).
Meanwhile Devas Multimedia, has clarified that there were factual inaccuracies in the newspaper report, and Devas Multimedia has not received any communication, regarding the contract, from ISRO/Antrix or any other government agency.