Private Sector Participation in Space 

Syllabus :GS 3/Economy 

In News 

• The Union Cabinet has approved a ₹1,000 crore venture capital fund to support firms in the space technology sector. 

Historical Developments

• India’s space programme has evolved over more than five decades, focusing on application-driven initiatives to serve the common man.
• Indian Space Research Organisation (ISRO) is advancing with missions to the moon and sun, and plans for space telescopes and manned missions.
• ISRO has partnered with both public and private firms like HAL, Antrix, and Godrej Aerospace to manufacture space components.
  • Antrix Corporation (1992) was created to commercialize ISRO’s products internationally.
• ISRO’s growth is complemented by a burgeoning private space sector.
• ISRO is now one of the six largest space agencies globally, operating a significant fleet of GEO communication and LEO remote sensing satellites.

Private Sector Involvement

• The past few years have been significant for the growth of India’s private space sector. 
• Over 200 start-ups have emerged since the early 2010s, focusing on satellite design, manufacturing, and launch services.
• Key start-ups include: Dhruva Space: Custom satellite design and ground stations.
  • Skyroot Aerospace: Private launch vehicles and successful launches.
    • Skyroot Aerospace launched the first Indian private rocket, Vikram-S, in 2022.
  • Agnikul Cosmos: Innovative mobile launchpad and propulsion systems.
    • Agnikul Cosmos launched the world’s first rocket with a fully 3D-printed engine from its private launch pad in 2024.
  • Manastu Space: Green technology for propulsion and satellite services.

Regulatory Framework:

• IN-SPACe: IN-SPACe is an autonomous agency under the Department of Space, established in 2020 to facilitate private sector participation in space activities.
  • IN-SPACe has signed around 45 MoUs with NGEs and has implemented various supportive schemes like the Seed Fund Scheme and Technology Transfer initiatives.
• Anusandhan National Research Foundation:This foundation aims to enhance public-private partnerships in scientific research, with a projected budget of ₹50,000 crore over five years, largely sourced from non-government funding.
• National Geospatial Policy (2021): Facilitates private access to geospatial data.
• Indian Space Policy (2023): Allows private companies to operate satellites and launch vehicles, enhancing market participation.
• FDI Policy: The Indian government allows 100% foreign direct investment (FDI) in the space sector, attracting overseas funding.
  • Amendments:Centre amended its FDI policy, allowing up to 74% FDI for satellite manufacturing and operation, up to 49% FDI for launch vehicles, spaceports and associated systems and 100% FDI to manufacture components and systems/sub-systems for satellites, ground and user segments.
    •  Beyond the above mentioned limits investment is allowed in these segments via the government route.
• NewSpace India Limited (NSIL):Established in 2019 to enhance indigenous production and support domestic customers.

Recent Developments

• IN-SPACe has proposed a Rs.1000 crore Venture Capital Fund to support the growth of India’s space economy, currently valued at 8.4 billion dollars , with a target to reach $44 billion by 2033. 
• The fund will be deployed over five years, starting with ₹150 crore in the 2025-26 financial year, followed by ₹250 crore annually for the next three years, and ₹100 crore in 2029-30.
• It will serve as an Alternative investment Fund under SEBI regulations, providing early-stage equity to startups and enabling them to scale for further private equity investments.

• The proposed fund is expected to boost employment in the Indian space sector by supporting startups across the entire space supply chain—upstream, midstream, and downstream. 
• It will help businesses scale, invest in R&D, and expand their workforce. 

Future Prospects:

• Despite private sector growth, ISRO remains the key player, launching numerous foreign satellites and leading various significant missions.
• The goal is to grow India’s space economy from $8 billion to $100 billion by 2040, with continued leadership from ISRO and collaboration with private start-ups.
• The sector’s future success depends on robust policy implementation, supportive ecosystems, and seamless collaboration between the government, ISRO, and private entities to realize India’s space ambitions both domestically and globally.

Source: TH