Wednesday, September 07, 2005

Bouncing the member states?

There is something not quite right about the announcement today that India has signed an agreement with the EU, "sealing its participation in the Galileo satellite navigation system."

Participation was, in fact, agreed in principle in November 2004 when it was announced that India was prepared to pledge €300 million to the project (€100 million more than China). This, however, was followed a month later by news that New Delhi would pull out and join the Russians on a co-operative venture, unless the EU promised that India would be an "equal partner" and just a "mere customer".

Barring the occasional vague reference, the issue then dropped out of the public domain and only now has reappeared to conicide with the EU-India summit which started today.

What is totally missing from the official announcements is any reference to the amount India is prepared to pay for its participation. All the journalists got out of the joint press conference with Tony Blair was an enigmatic statement from G Madhavan Nair, secretary in the Department of Space and chairman of Indian Space Research Organisation. He dismissed calls for figures, saying: "The equity will be decided according to the extent of our participation."

One wonders whether this lack of detail has any connection with the fact that the whole Galileo project is in trouble, reported by this Blog last July. The operating concessionaires are demanding an extra €1 billion for the period 2007-2013 to pay for the running of the system, when the revenues will not match expenditure and, so far, EU member states have not approved the payment.

As it stood last July, without a guarantee of future revenues, the earlier phases of the poject were at risk because the contractors were unwilling to sign a contract until they were assured that a funding stream had been secured. A deadline was set for September for the member states to come up with the money.

Obviously, it can be no coincidence that one of the first agenda items of the EU parliament on its return from the summer break was to "approve" the spending of the extra billion, misleadingly announced by Ireland online as "EU approves funding for Galileo satellite system".

The parliament, of course, has no say in the money, as it is for the member states to find the money, and so far there has been no indication that they are prepared to stump up.

Added to this is another "coincidence", a sudden annoucement, for no particular reason, that Israel is set to join EU Galileo space project, something it has been thinking about for years. This, with the declaration yesterday between China and the EU on Galileo, and the India declaration today, combined with the EU parliament vote, and it begins to look like less than subtle pressure is being exerted on the member states to bounce them into opening the purse strings.

However, when push comes to shove, national governments are being presented with a pretty hefty bill for a system that is not yet online, and for a service that they already get for free from the US "Navstar" GPS system. It will be interesting to see whether the pressure works and, in the UK context, whether Mr Gordon Brown will be at all happy at being bounced into paying even more for this EU extravagence.


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