According to senior officials in Videsh Sanchar Nigam Ltd (VSNL), Globalstar, had approached the service provider for setting up three earth stations in India and a memorandum of understanding (MoU) was to have beensigned in July 98, which was later postponed to September 98. But with Hyundai announcing its intention of pulling out, senior officials of Globalstar had apparently told VSNL that the MoU would have to be delayed further.

However, Globalstar has confirmed its committment to setting up the communications infrastructure in India, the sources said.

Globalstar is an international consortium of communications companies and was set up with the purpose of providing a worldwide satellite mobile communication system, through 66 low orbit satellites.

In India, Globalstar had set up a subsidiaryGlobalstar India Satellite Services (GISS) in which Crompton Greaves had a 34 per cent stake, Pertech Computer had a 17 per cent stake and Hyundai holding 49 per cent.

The Indian project envisaged setting up of three earth stations in Chennai, Calcutta and Dehradun and the operations were scheduled for launch in the middle of 1999. Company sources also said that Globalstar International was upbeat on the Indian market.

Globalstar India had gone on to identify the sites for the earth stations and negotiations with VSNL had been initiated, before Hyundai's pullout put a spoke in the wheel.

VSNL officials feel that since Globalstar India now has to be freshly set up with different promoters, it was a wise move to delay the MoU.

But while the Globalstar project is facing a delay, competition is riding strong. Iridium, a similar satellite communications project is scheduled to launch its services in September 98.