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Madhavan Nair on why the Antrix-Devas deal went sour

By Shobha Warrier
Last updated on: July 29, 2016 13:21 IST
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'Was Devas deliberately trying to get out of the contract and, while getting out, were they trying to make money?'
'Was the situation created by DoS and others to help Devas, and what we saw later a result of that?'

IMAGE: The Polar Satellite Launch Vehicle (PSLV-C25), carrying the Mars orbiter, lifts off from the Satish Dhawan Space Centre in Sriharikota, November 5, 2013. Photograph: Babu/Reuters

G Madhavan Nair was chairman of the Indian Space Research Organisation when it accomplished 27 successful space missions. He had also served as the secretary, department of space, Government of India, and also as chairman of the Space Mission.

In 2005, during his tenure as chairman of the governing body of Antrix Corporation, that Antrix signed a deal with Devas which later ran into a controversy. Nair, a Padma Vibhushan winner, is still fighting to clear his name.

After The Hague-based Permanent Court of Arbitration ruled against the Indian government over the cancellation of the Antrix-Devas deal in 2011, Nair, image, below, spoke exclusively to Rediff.com's Shobha Warrier on the deal and what happened thereafter.

The international tribunal at The Hague has ruled against the Indian government over the cancellation of the contract between Devas Multimedia and the Antrix Corporation Ltd, and asked the government to pay a compensation of approximately $672 million (about Rs 4,500 crore) to Devas. How did you feel when you heard about the ruling?

It is unfortunate that the cancellation of the agreement between Devas and Antrix Corporation has resulted in this.

As you are aware, the agreement with Devas was for a good cause, for providing mobile and multimedia services through satellite anywhere in the country. That was a unique thing, which not many countries have.

This agreement was also in line with other agreements we had signed with many other operators like Tata Sky, Dish TV, Airtel, etc for leasing of transponder capacity.

When the audit raised a question, and indicated a presumptive loss of Rs 2.8 lakhs crore without properly explaining the difference between the value of terrestrial spectrum and space segment and the agreement between Antrix and Devas, there was a panic reaction from the department of space and the Prime Minister's Office.

It was then reported that the leaked report in 2011 alleged that there were irregularities in the agreement, like conflict of interest, favouritism and financial mismanagement...

Those were all cooked up stories. Twenty such agreements signed with various parties indicate that the procedures adopted were as per the practices existing at that time, and this also was on the same lines.

You mean, there was no difference in the agreements Antrix signed with Tata Sky and Devas?

Right. The responsibility of Antrix was only to provide transponder capacity. They are not authorised to allot spectrum or give the licence to anyone, which was the responsibility of the department of telecommunications.

After launching the satellite and giving the capacity to the user, the latter had to approach DoT for licences. This particular case had not reached anywhere near the licensing stage.

But without properly understanding the situation, some people in the department thought otherwise and soon there was a panic reaction from the PMO. They then decided to cancel the agreement.

K Radhakrishnan was chairman of ISRO at that time and it was he who advised the government to cancel the agreement.

After annulling the contract, Radhakrishnan said S-Band spectrum was needed for larger national and strategic purposes. Do you agree?

At that time itself this comment was refuted. The spectrum that we are talking about is broadcast spectrum from space, and it cannot be used for security and other needs. Proof of that is, this declaration was in 2011 by Radhakrishnan and even today, after five years, not even one hertz of that spectrum is used for any such application. He was absolutely misleading the government on the issue.

In fact, initially they said there were procedural lapses or deviations in it and so they had to cancel the contract. Later they changed their stand, stating that S-Band spectrum was required for security needs. Both the arguments were wrong.

You mean ISRO misled the government and that was why the government decided to annul the agreement?

Yes, that was how the annulment took place. Even otherwise, if the government decides that we need the spectrum for any other purpose, we have all the right to cancel an agreement which was signed with other parties.

But here what has happened is, for cancelling the contract, Radhakrishnan and his team took the law in their hands. If you have an agreement with a party, you have to engage him in a dialogue, explain everything to him and discuss the terms and conditions of the cancellation and then issue a cancellation order. This has to be brought to the notice of the government before a decision is taken.

Instead of following the correct procedure, they simply sent the cancellation order and returned the advance paid by Devas. What they did was a one-sided action.

Devas wanted a discussion with the department but they never responded to the request.

Though it was an agreement between two parties, it became a one-sided culmination of the contract…

Yes, it was not only taken by one party but implemented also in a one-sided manner. There was no proper dialogue between the two parties. In fact, this is the issue which the international court took exception to.

India set up two committees to investigate the matter and they couldn’t find any evidence of a quid pro quo between ISRO and Devas. They said procedural lapses had taken place. What were they?

It is like this. Once you take a wrong decision, you have to take many wrong decisions to camouflage or whitewash it. These two committees were the outcome of that. They wanted to justify the wrong decisions by appointing committees.

The B K Chaturvedi committee was fair enough. They said there was nothing wrong with the agreement, there was no sale of the spectrum and there was no loss to the government.

Not satisfied with this, they appointed the Pratyush Sinha panel in which Radhakrishnan himself sat as a member. The complainant sitting as a member in the review committee is unheard of. They said there were procedural lapses and four administrators and four technical people were named responsible for the lapses.

Without giving a chargesheet or a memo, they took a unilateral decision to debar four scientists from government service, while no action was taken on the administrators.

Again, it was not based on any rule or law, but was a high-handed action.

So all that happened in the 2010-12 time-frame was totally unethical, without following any procedure and will not stand the scrutiny of legal framework.

Is that why both the international tribunals found the termination of the agreement unlawful?

Absolutely. They have not even gone into the merits of the issue. They said the procedure adopted by DoS was unilateral and without following legal procedures. Based on that, they have slapped a fine on the government.

Also, in the international tribunal, we did not defend the case properly. There was a provision for having one of the arbitrators recommended by us. We didn’t respond properly and they appointed somebody else. So we lost an opportunity to have a judge of our choice on the panel. If not, things could have been different.

I feel we should have fought the case properly. If we had, the result would not have been like this. Basically, we should have presented our case properly and defended well.

Do you feel vindicated that two international tribunals found unlawful the ISRO’s annulment of the agreement Antrix signed when you were its head?

I don’t look at it from that angle. I am sad that the department misled the government and we were put in such a difficult situation. They should have sought the opinion of some of us in defending the case.

It exposes that unlawful action was taken by DoS and the PMO at that time.

Because it was the PMO’s decision to annul the agreement and they were mislead by ISRO?

That’s right. One thing is very clear. The whole thing has two sides to it. On one side, you say there was a procedural lapse and the agreement had to be cancelled. Then this particular file was held up somewhere for almost a year, from June 2010 to February 2011 when this file was put up to the Cabinet Committee on Security. 

You have always said that some kind of witch-hunt was going on against you.

The matter was very simple. They wanted to shield the prime minister. For that, they had set up two pseudo committees so they could say they had taken action against the concerned people.

So this was actually a face-saving effort to protect the PM.

In between, what negotiations took place between Devas, ISRO and the PMO, you do not know.

You mean, it is not out in the open?

Yes. One can then ask, was all this drama performed to help Devas? That is, for Devas to get out of the contract and get some money?

I will give you a simple reason for that.

In 2005, when they signed the contract, there was a huge market for hand-held entertainment devices. But when 2G, 3G etc came, such content became available through the towers itself. So the relevance of this segment was down drastically. It was applicable only in remote areas, like in villages. So the market was to come down.

So the question is, was Devas deliberately trying to get out of the contract and while getting out, were they trying to make money? Was the situation created by DoS and others to help Devas, and what we saw later a result of that?

This is my doubt and somebody has to look into this.

At that time, it was reported that the estimated loss for the government because of the agreement was around Rs 2 lakh crore.

The preliminary inquiry only weighed this question. Vinod Rai, in his book Not Just An Accountant, has a page on this. He wrote that the calculation was absurd as the formula for space and ground is different. His final audit report also says the same thing, that there was no loss to the government as no spectrum sale had taken place and if at all, the government was not kept adequately informed.

Like I said in the beginning, dozens of such lease agreements were done, and the government was not in the picture at all. It was the delegated power through Antrix which was used at that time.

But was Antrix not created to promote commercial exploitation of space products?

There was no need to bring the government in between. If you look at it that way, even for cancelling the agreement we didn’t have to involve the government at all. It was a wrong decision by the management to involve the PMO in this.

Do you see professional jealousy behind all that?

That’s the starting point. I will say this happened because of ignorance coupled with arrogance. You may have a good technical understanding but you should be humble enough to realise that we basically work for the country and the people.

The Central Bureau of Investigation questioned you in May. What was it about?

It was about the origin of the Antrix-Devas agreement. I feel they have to look at what transpired while cancelling the agreement as well, and who has misled the government

Do you feel the witch-hunt will end with this?

I hope so. I know the three scientists who worked with me are absolutely clean and they will not get into any shady operations. I can vouch that in my time, no shady operation has taken place.

Yes, it is sad to have such an end to one’s career. But I am fully with the government and I am available for anything to solve this affair. It is definitely not an issue on which the government should be losing any money; not even a single paisa.

Now that the government has been asked to pay a hefty amount, who do you hold responsible for the situation – Dr Radhakrishnan, ISRO, or the then PMO?

In the verdict, they have named Radhakrishnan as the person responsible for this. However the time has come for our government to conduct a detailed enquiry and fix the responsibility on the person who has caused the loss, and who was misleading the government all along.

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Shobha Warrier / Rediff.com in Chennai
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