Transponder charges: Plan afoot to retain DTH services on Indian sats

NEW DELHI: The Department of Space (DoS) has said that a technical strategy is under formulation to retain direct-to-home services in the indigenous INSAT/GSAT system as well as to migrate DTH services from foreign satellite systems to indigenous system.

This has been stated by the DoS to the Public Accounts Committee (PAC) of the Parliament, which had, early in 2016, in its fortieth report, complained about loss due to non-revision of transponder charges.

In its action-taken report (ATR) tabled in the Parliament by the PAC recently, it has also noted that a Committee to look into the subject matter is being constituted, and its recommendation will be addressed by the DoS.

Referring to non-revision of prices for transponders, the DoS told the PAC that lease agreements with foreign satellites are entered for a short term in order to make a provision for the end user to migrate the services from foreign satellite to the Indian satellite. This approach, the DoS claimed, is in line with the recommendation of the Cabinet approved 'Norm, guidelines & procedures for implementation of the policy framework for satellite communication in India'.

The Department said as the foreign operators quote lease charges in dollar terms, differential charges among indigenous capacity and foreign lease is unavoidable due to currency fluctuations and withholding taxes.

However, it said it will work towards a scenario wherein the best possible solution for DTH services will be arrived at.

In its original report last year, PAC had noted that DTH transponder lease agreements had a lease period from 5 to 10 years with no provision for revision of prices whereas lease agreement varied from 5% to 33%. The lack of such basic provisions resulted in revenue forgone to the tune of Rs 361.7 million.

Furthermore, Vetted Comments of Audit Central PAC in its report last year had also wanted the DoS to set up an inquiry to look into the lease agreements with various parties and take stringent action against those responsible for agreeing to terms that were against the interest of the exchequer and apprise the Committee of the action taken within three months.

However, it noted in the Action Taken Report that the Department did not initiate any action and instead said it had appointed a committee to look into these aspects as the lease agreements with foreign satellites are entered for a short term period and to examine periodic revision clause.

But, the Committee said the fact remained that DTH transponder lease agreements had a lease period from 5 to 10 years with no provision for revision of prices whereas lease agreements with foreign satellites ranged from one to 6 years with provision for price revision from 5 to 33%. The price revision clause is required to be there in all the transponder lease agreements which extend for more than one year irrespective of the fact that the contract is for a shorter duration or longer duration.

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