New Delhi: Finally, the government citing 'strategic interest' has scrapping the Antrix Devas deal. The Cabinet Committee on Security that decided to annul the contract India's Space Research Organisation's commercial arm Antrix entered into with Devas Multimedia was clear - the country's security forces needed the spectrum.
The crucial S-band spectrum is needed for national needs including defence, paramilitary and railways and can't be handed over for commercial use.
The strongest statement coming from the Defence Minister who said his Ministry was not even consulted when the deal was done.
Defence Minister AK Antony said, "We were not even consulted at that time."
Even so the government is confident that if taken to an international court, it stands on a strong legal wicket.
Law Minister Veerappa Moily said, "This is a matter in which even if they go to a court, they are not likely to succeed. And we will be able to face any challenge."
The Law Ministry, in its opinion in 2008 had made it clear to the government that in event of termination Antrix shall be required to reimburse Devas all the upfront capacity reservation fees and corresponding service taxes received till that date.
The annullment clearly hasnt dented the Oppositions attack. Allegations that the deal was heavily undervalued have already brought the Prime Minister Manmohan Singh into question. Since the Department of Space comes direvtly under the Prime Minister's Office.
CPM Politburo Member Brinda Karat said, "How was this deal permitted in the first place? The second question is, who are the investors in this?"
Many would say terminating a six-year-old contract maybe an admission that the government may have erred in okaying it in the first place. Annulling the Devas contract may have been damage control but spectrum is likely to dominate the political space for sometime to come.