Elections rouse emotions. Especially one where 900 million people will vote to elect their leaders this month. That, to an extent, explains the timing and the ensuing chest-thumping after India demonstrated its ability to destroy targets in space by shooting down one of its own satellites late last month. It, however, doesn’t explain this under-the-radar activity: creating a new public sector company under the Department of Space (DOS), which already owns another public sector company, Antrix Corporation Ltd. Created 26 years ago, Antrix has since been the commercial arm of ISRO, selling its technologies and services.
On 19 February, a 9:30PM Press Information Bureau release said that the Union Cabinet chaired by Prime Minister Narendra Modi had approved setting up of a new company, “to commercially exploit the research and development work carried out by Indian Space Research Organization (ISRO) Centers and constituent units of DOS.”
Conspicuously, the news went unreported.
On 6 March, Newspace India Ltd was incorporated with D Radhakrishnan and Suma Devaki Ram as its two directors, according to the documents filed with the Ministry of Corporate Affairs. The two ISRO directors, of launch services and operations respectively, also serve on the management team of Antrix. On the face of it, Newspace looks no different from Antrix. Like Antrix, Newspace is attached at the hip to ISRO. This relationship has been awkward, thorny even, for industry partners and customers because it comes in Antrix’s way of independent and fair commercial operations. Nonetheless, it’s the timing of the new company rather than its ownership structure that is important. Is it a safety net for ISRO when Antrix stares at a liability payout of at least Rs 7,000 crore ($1 billion) in just one of the three arbitration cases that it has lost?
In 2011, the ISRO leadership unilaterally broke a commercial agreement between Antrix and Devas Multimedia Pvt Ltd, a newly set up communications services company. It was a decision that would go down in the history of ISRO as mysterious and irresponsible. One that would make India’s space establishment pay through its nose: all put together, close to $1.5 billion in penalties paid out of the Consolidated Fund of India.
Devas had signed an agreement with Antrix in 2005 to lease transponders on two of ISRO’s yet-to-launch communications satellites, GSATs, to launch hybrid satellite-terrestrial broadband services. It would use spectrum in the 2.5 GHz or S-band, then an unutilised resource. It was a unique business deal—ISRO would build customised satellites for a private company. Everyone was getting along with their business until India’s purported satellite, GSAT-4, failed in 2010 due to a rocket failure. Soon after, India’s 2G spectrum scam would consume everything telecom and communications, dragging the S-band project into controversy. A leaked CAG report hinted at irregularities, mostly procedural lapses, in the Antrix-Devas contract.