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Devas and its affiliates are currently owed more than $1.5 billion by the Government of India, as confirmed by three separate independent international arbitration panels.

Devas Multimedia Pvt Ltd was conceived in the early 2000s by global pioneers in the fields of satellite communications. Devas (Digitally Enhanced Video Audio Services) built a team of unrivalled expertise and industry experience, supported by investors with a global track record in the satellite communications space:

Devas’ founders believed there was enormous potential and opportunity to deliver cutting-edge digital multimedia broadcasting service and mobile broadband across India using the S-band spectrum. This would positively impact the lives of hundreds of millions of people by ensuring they have access to high-speed communications and internet.

Devas Multimedia Pvt Ltd entered into an Agreement (the ‘Devas Agreement’) with Antrix and the Indian Space Research Organization (ISRO) on January 28, 2005 to build out a hybrid satellite and terrestrial communications service throughout India, leveraging similar technology and systems that the founders and investors had successfully deployed in the U.S.

The partnership was ideal for ISRO and India.  ISRO would elevate its satellite-building capabilities and reputation. India would preserve its national entitlement to the hitherto unused S-band frequency, and further benefit from utilizing the space segment spectrum terrestrially.

The Devas Agreement required Devas to bear most of the financial burden and commercial risk of building out the satellite network. From the date of execution in January 2005 and for almost five years thereafter, Antrix and Devas together worked intensively to develop a first-of-its-kind integrated satellite system in India. This system was uniquely capable of delivering state-of-the-art communications applications for 1) consumer applications, 2) rural development, 3) e-governance, 4) emergency communications, 5) remote connectivity, and 6) societal services. Successful experimental trials of the system were completed in 2009.

During this time, Devas scaled up – both financially and technically, with world-leading investors and pioneers from the communications and satellite community. In 2008, Deutsche Telekom took a 17 percent stake in Devas for almost $75 million. Columbia Capital and Telecom Ventures contributed additional investment to Devas. Devas expanded its board of directors to include Kiran Karnik, a former President of Nasscom; Larry Babbio, a former vice-chairman of Verizon; and Gary Parsons, the founder and former Chairman of SiriusXM Satellite Radio.

Then, unbeknownst to Devas and its investors, the Government of India secretly moved to unlawfully terminate the agreement.

As part of its calculated strategy, the Government of India appointed a new head of ISRO/Antrix, Dr K. Radhakrishnan. His first order of business: instruct a “one-person committee to investigate” the Devas Agreement to expedite its termination. The committee of one, comprised of Dr B. N. Suresh of the Indian Institute of Space and Technology (the “Suresh Report”), concluded in May 2010 that the Devas Agreement was above board.

Simultaneously, a sinister campaign began to take shape in the Indian press, claiming (without evidence) that the Devas-Antrix Agreement was executed in bad faith, as a purported fraud.

In July 2010, dissatisfied with the result of the Suresh Report,Dr K. Radhakrishnan sought a formal opinion of the Additional Solicitor General (ASG) of India, Shri Mohan Parasaraan. The ASG advised that Antrix didn’t have grounds to terminate the contract for cause, as Devas had fulfilled all responsibilities under the contract.  Parasaraan then advised that the only route to terminate the agreement was for the Government of India to invoke the“doctrine of force majeure.”

On February 25, 2011, Devas was notified that India’s Cabinet Committee on Security (CCS), decided to terminate the agreement based on the “doctrine of force majeure.”

In July 2011, Devas initiated the first of three arbitration actions relating to the Devas Agreement.

  • The first was initiated by Devas against Antrix before a tribunal seated in New Delhi under the rules of the International Chamber of Commerce (ICC), as per Article 20 of the arbitration provision of the Devas Agreement. In September 2015, the tribunal ruled in favor of Devas, resulting in an Award in favor of Devas and against Antrix for $672 million for “unlawfully terminating” the agreement. This Award, which has, with interest, grown to over $1.2 billion, was confirmed and a judgment entered against Antrix in November 2020 in the U.S. District Court Western District of Washington.
  • The second arbitration was commenced by Mauritius-based shareholders of Devas against the Republic of India in July 2012 at a tribunal seated at The Hague and administered by the Permanent Court of Arbitration, under the Arbitration Rules of the United Nations Commission on International Trade Law (“UNCITRAL”). In 2016, the UNCITRAL tribunal found India liable for “unlawful expropriation” of the Mauritian shareholders’ investments and “failure to provide fair and equitable treatment” in violation of India–Mauritius Bilateral Investment Promotion and Protection Agreement (BIPA), Articles 6 & 7. In October 2020, the tribunal issued the award on quantum (known as the BIT Award), ordering India to pay the Mauritian shareholders damages totaling $160 million including accrued interest.
  • The third arbitration was brought by Deutsche Telekom, an investor in Devas, against the Republic of India in September 2013 before an UNCITRAL tribunal seated in Geneva.  In 2017, the tribunal ruled that Devas had been intentionally misled by the Government of India throughout the process of the Agreement, which was wrongfully terminated.  The tribunal held that India had violated the 1995 Bilateral Investment Treaty between India and Germany by expropriating Deutsche Telekom’s investments in Devas and failing to provide fair and equitable treatment to the company. On May 27, 2020, the tribunal issued a final award to Deutsche Telekom totaling US$132 million plus interest until paid in full.

Saddled with arbitration decisions now exceeding $1.5 billion, the Government of India has resorted to unsavory tactics under Prime Minister Modi, going on “a war footing” (according to an official government document) to evade lawful payment at all costs.

First, in a move unworthy of any lawful democracy – the Government of India changed their arbitration law. The order, issued by the Indian Ministry of Law and Justice, amends the Indian Arbitration and Conciliation Act of 1996 to require that Indian courts “unconditionally” stay enforcement of an arbitral award when there is a prima facie showing that the “arbitration agreement or contract which is the basis of the award . . .was induced or effected by fraud or corruption.”

Second, the Government of India initiated tax proceedings that appear designed to generate large tax bills, penalties, and interest large enough to offset the ICC Award.

Third, the Government of India has contrived criminal investigations against Devas executives and investors, persons of international stature, as an intimidation tactic.

Fourth and finally, the Government of India allowed Antrix, the debtor to Devas, to petition for the winding-up of its creditor Devas before the National Company Law Tribunal (NCLT), a specialized companies court in India, based upon false and unproven allegations that the Devas Agreement “had been obtained fraudulently.” Antrix has been represented in those proceedings by none other than Prime Minister Modi’s legal right-hand, Solicitor General Tushar Mehta, and his assistants, and to no one’s surprise, the NCLT appointed a provisional liquidator who has moved quickly to disable Devas’ legal representation around the globe.

Why has the Modi government taken this action? The liquidator will have the power to dispose all of the company’s assets, including the arbitration Award from the International Chamber of Commerce (ICC) tribunal. 

Let’s be perfectly clear about what this means: India is an unsafe place for investors, and has taken on the worst qualities of countries like Russia and China. It has weaponized its judiciary to sabotage Devas’s rights to enforce an international arbitration Award, defied its international treaty obligations, made false accusations of fraud, including initiating criminal proceedings and using the media to tarnish their image. As this becomes better known, it will surely tarnish India’s standing in the community of nations.