On foot in the rain, late for an appointment and unable to locate Hercules Street near Waterloo station, I sought advice from a waiting minicab driver. He pored over his A-Z without success. Then he switched on his sat-nav system. At once a small screen showed the way. “Thanks so much,” I said.

“No problem. I'm losing the knack of map-reading these days. Anyway you don't pay extra to use the sat-nav once you've got it.”

And you don't. You pay for the box of electronics in your car, but not for the signals. Nobody does, I have since found out. It was there in the rain that a train of thought and inquiry began that now persuades me that the British Government must not go cold - as we are in danger of doing - on the EU's plans to build and operate a European global positioning system: Galileo.

I just said that nobody pays for the use of sat-nav's positioning system. In reality the US military does. The Global Positioning System (GPS), designed, built and maintained by the US Defence Department, and costing Washington approaching £500 million a year, has been free for civilian use worldwide since Ronald Reagan decreed this in 1983. Relying on an orbiting network of never less than 24 satellites, the Global Navigation Satellite System transmits to Earth microwave signals that, when we lock on to them from wherever we are, enable us to determine our own position - as well as our speed and direction of movement and, incidentally, the exact time.

This is done by measuring the distance between our receiver and three or more satellites. Distance is read by the time delay between transmission and reception of signals, since the speed at which the signal travels is known.

That is the theory. But the computation and adjustments and the feeding in of changing atmospheric data is fiendishly complex. The launching and maintenance of the satellites is vastly expensive. That is why only the US provides a 24-hour global positioning system.

America funded GPS for military reasons. At first civilian uses were just an extra. It is not obliged to make the system available to the rest of us and can, if it wishes, encrypt signals to deny others access. Until Bill Clinton rescinded the order in 2000, the Pentagon did restrict the civil availability of the most accurate readings, by using an encrypting system called Selective Availability. But pressure from the Federal Aviation Authority, and the fact that US troops were relying on private, personal GPS receivers, persuaded the Pentagon to disable SA.

Now anyone can receive the full service. Washington says - and may believe - that providing this gratis to the world for civilian use is intended for the public good. But one consequence is that it is very hard to find commercial backing from the private sector anywhere for the establishment of any rival to GPS. Why pay for your own system, when America's is free for all of us?

Russia, India and China have shrugged their shoulders at this. All are putting public money into systems of their own, all intended to be global, none yet close to full coverage. The EU, however, had always planned that Europe's global positioning system, Galileo, would be built partly with private sector investment. The principle was agreed in 1999. The system is to be primarily for civilian rather than military use and should provide a global service comparable to the American GPS, though it is projected to be even more accurate.

An unexpected spur to Galileo's go-ahead, agreed by France, Germany, Italy and Britain and others in 2003, was the extraordinary hostility of the US Government to the whole idea. After 9/11 Washington expressed its total opposition to our project. The Americans argued that this would undermine their control of the military use of global positioning. The vigour of Washington's reaction alarmed European governments, and a project that had seemed becalmed gained impetus. European governments decided they needed their own, independently operable, positioning system.

The current plan is for Galileo to be commissioned by about 2010, but this year the financing has approached something close to crisis. Private money in sufficient quantity is not forthcoming. Though no formal statement to this effect has been issued, there is a widespread impression that Britain (no doubt under private pressure from the Americans) and Germany (newly friendly to Washington now that Angela Merkel is in charge) are going cold on the plans. The French remain enthusiastic.

One should always be sceptical of the Gallic taste for carelessly costed grands projets; and the incipient anti-Americanism of French administrations needs cooling. But the case now for a dollop of political enthusiasm and public funds for a pan-European project whose immediate commercial prospects may be bleak seems very strong. We become so easily aerated over constitutional changes that may appear to threaten what we call our “sovereignty”. These make the headlines. But beneath the headlines, technological and commercial shifts - quiet but continuous - can leach autonomy away in less sensational but finally compelling ways.

When Britain ruled the waves our Navy gave us muscles that we only rarely needed to flex. Today Microsoft pursues its dominance over the global movement of information; while (less noticed) the developed world slips imperceptibly into a dependence on a US system of global positioning that is steadily supplanting traditional forms of mapping, map-reading, targeting, surveying, and navigating by sea, land and air. We may one day wake up to find that our national life could be paralysed in an instant, without a shot being fired.

We need not posit any present conspiracy in Washington. With today's technology it would be hard for the US to curtail access to GPS without damage to American as well as foreign interests.

But the means of selective denial of access - by encryption or by jamming - are likely to be developed and refined. And once a nation gains a potential stranglehold over others, it will sooner or later use it, convincing itself that this is in the interests of mankind as well. British Eurosceptics ( I am often one) can be rather quick to impugn not only the judgment, but also even the patriotism of British Europhiles. But there is also a patriotic British case for remaining vigilant over American ambitions: a case hardly heard in the watchtowers of Eurosceptics where telescopes are pointed in a different direction.

If asked for a modest additional contribution towards the costs of proceeding with the Galileo project, our Government should not hesitate. National interests alter; alliances shift; we cannot know how. Meanwhile, a critical dependency is creeping up on us unawares.

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