US-based Hughes’ $500 million FDI proposal to build a satellite communications system in India has not been cleared by the DoS for nearly four years.Kolkata: Global satellite builders and communications service providers have called on finance minister Nirmala Sitharaman to allow 100% foreign direct investment (FDI) through the automatic route to attract billions of dollars into the space/satellite broadband sectors from the likes of Amazon, Elon Musk’s rocket engine maker SpaceX, Hughes and Telesat, among others.
All FDI proposals in the satellites space are currently screened by the Department of Space (DoS) and its internal panel, the Committee for Authorisation of Indian Satellite Systems, a scenario that has held up big-ticket FDI proposals for years, say experts.
“The commercial satellite broadband segment is attracting billions of dollars across the globe from companies like SpaceX, Amazon, Hughes, Inmarsat, Telesat and Viasat, and to attract this investment into India, we recommend 100% FDI be allowed under the automatic route,” said TV Ramachandran, president, Broadband India Forum (BIF), in a May 28 letter to Sitharaman.
This, he said, would enable these top global players to set up Indian private companies for participation in space activities. BIF counts Amazon, Hughes, Viasat, Inmarsat, Intelsat, Google, Facebook, AT&T and Apple among its key global members.
The letter comes barely a fortnight after Sitharaman said a level-playing field would be created — for private satellite builders, launchers and space-based service providers to invest aggressively in India — with a new policy and regulatory regime.
Ramchandran said, “Though (India’s) existing policy allows 100% FDI in satellites, for both establishment and operation, subject to government approval, no one has been permitted so far.” ET has seen a copy of the letter.
For instance, US-based Hughes’ $500 million (Rs 3,800 crore) FDI proposal to build a satellite communications system in India has not been cleared by the DoS for nearly four years, even after Hughes sought intervention of the Prime Minister’s Office two years ago.
“This issue can ideally be addressed if FDI is allowed through automatic route,” a top industry executive told ET.
Source: indiatimes.com
