Context: India aims to increase participation in the global space economy by encouraging private investment and participation, as announced recently at the G20 Space Economy Leaders meeting.
India’s Space Industry
- According to a report by the Confederation of Indian Industry (CII), the Indian space industry is expected to reach USD 50 billion by 2025, driven by the demand for satellite-based services such as telecommunication, navigation, and earth observation.
- The report also estimates that the industry has the potential to generate around 100,000 direct and indirect jobs. The space industry has been predominantly controlled by government-owned organizations.
- Indian industry had a barely 3% share in a rapidly growing global space economy. Currently, the value of the global space industry is estimated to be $360 billion.
Indian Space Policy (ISP) 2023 : A Boon for Private Sector Participation
- The Indian Space Policy 2023 has been approved by the Union Cabinet to boost private investment and encourage private participation in all aspects of space activities.
- The policy seeks to institutionalize the private sector’s participation in the space sector while allowing the Indian Space Research Organisation (ISRO) to focus on research and development of advanced space technologies.
- The policy delineates the roles of ISRO, New Space India Limited (NSIL), and Indian National Space Promotion and Authorization Center (IN-SPACe), and the operational part of ISRO’s missions will be moved to NSIL.
- IN-SPACe is a single-window, independent nodal agency under the Department of Space that seeks to promote and enhance the role of Non-Government Entities in the Indian space sector.
- New Space India Limited (NSIL) is the country’s first public sector undertaking in the space sector and commercial arm of ISRO aimed at production and marketing of space-based services, also empowered to own the operational launch vehicles and space assets of ISRO.
- ISP encourages the private sector to invest in creating new infrastructure for the sector and outlines the framework for the private sector to use ISRO facilities.
- It also provides much clarity on the regulatory framework concerning activities ranging from remote sensing to deep-space exploration, as well as directing resources towards deep-space scientific and technological research.
- Space activities envisaged to be taken up by private sector under ISP 2023:
- Private players can produce components and subsystems of a launch vehicle, reducing costs and developing indigenous space industry. Example: AgniKul Cosmos developing a small satellite launch vehicle.
- Private players can produce components of a spacecraft and carry out integration and testing, reducing costs and developing private capabilities. Example: Bellatrix Aerospace collaborating with ISRO to develop electric propulsion systems.
- Private players can launch spacecraft on board a launch vehicle and establish and operate launch infrastructure. Example: Skyroot Aerospace developing small satellite launch vehicles and signing an agreement with the Satish Dhawan Space Centre.
- Private players can provide space-based services and operate ground stations for spacecraft. Example: OneWeb partnering with Bharti Airtel to provide high-speed internet services across India.
- Private players can develop space-based applications using satellite data, providing valuable data for various sectors. Example: India’s startup Pixxel is developing a constellation of earth observation satellites to provide high-resolution imaging services for various industries.
Advantages of Private Sector Participation in Space Programme
- Reduction in cost: Participation of private sector and start-ups in the space sector have an advantage in terms of low-cost operations.
- Technology and innovation: Participation of the private sector will give rise to new innovations and technology.
- Investment and capacity development: Private sector facilitates investments in technology development and acquisition, capacity-building and space exploration, including planetary exploration.
- Harvesting talent pool: India has a huge talent pool and is searching for opportunities. So, participation of private entities in the space sector helps to harvest a sizable talent pool available outside ISRO.
- Transparency and accountability: Expanding the number of stakeholders with participation of private entities will ensure more transparency and better accountability and regulatory practices.
- Competitiveness: With low cost, innovation and better talent pool in India’s space will make it more competitive with respect to globally reputed, private space industry.
- Fill communication infrastructure deficit: The vast amount of potential and resources available with the private sector will help the space industry to grow and fill in the communication infrastructure deficit by looking beyond the traditional modes of internet delivery and look for space-based solutions.
Challenges Associated with Private Sector Participation
- Conflicts of interest: Private sector participation in space in India may lead to tensions with government agencies due to conflicting interests between profit-making and national interests. For example ISRO acts both as operator and regulator which is a conflict of interest.
- Procedural hurdles: Private sector participation in space in India faces complex regulations and lengthy approval processes, which can result in delays and increased costs. For example in 2017 a US based company that announced a 500 million dollar satellite communication in India is yet to receive any approval or timeline.
- Lack of clarity on the level of private involvement: There is a lack of clarity on the extent to which private players can participate in the Indian space industry, leading to confusion and uncertainty.
- Absence of coherent policy: The absence of a comprehensive policy framework for private sector participation in space in India has created uncertainties regarding investment and technology transfer.
- Limited technological advancements: The Indian space industry lags behind in terms of technology development and innovation, which can limit the scope of private sector participation.
- Monopolistic trends: The entry of large private players in the Indian space industry may lead to monopolistic tendencies, reducing competition and innovation and excluding smaller players and start-ups.
- Social welfare may take a backseat: The focus on profit-making and commercialization may lead to neglect of public goods such as infrastructure, education, and healthcare.