A Primer to kicking off India’s space economy

As a long-term investor in space technology and infrastructure, India counts to be one among the top nations in the world in terms of government space investments and achievements. Here are some key insights on what we can do to elevate India’s stance in the global space arena and aid the emergence of India’s NewSpace globally.

  • If Indian industry needs to claim a greater traction in the international space market there is a need to promote and develop a model for promotion of startups with independent technology ideas, which carry the potential of leapfrogging product/service offerings out of India and are scalable globally. If such an ecosystem needs to be established, the government must consider instituting a national fund for promotion of entrepreneurship in space industry on similar lines of the Small Business Innovation Research and the Open Sky Technology fund to replicate the success of promotion and development of startups by NASA and ESA.
  • The emergence of Bangalore as an IT and Aerospace hub for the country should be leveraged for the space industry as well. Dedicated infrastructure that shall enable technology development (E.g. Berlin Adlershof) should be allocated to space ventures emerging from India to assist them in the startup stage. In addition, mentorship by senior ISRO and Antrix executives will ensure they operate within the Indian space policy framework but are still able to leverage technical expertise built by ISRO in an appropriate manner.
  • FDI in defence has been opened up to 49 percent by the government. However, there is need for an active stand on leveraging outer space by defence forces. The first step in encouraging FDI in defence space shall be in rolling out a mandate in utilising outer space for defence operations and moving away from the present model of dual-use.
  • For the industry to establish and flourish in India, one can set up a dedicated fund vehicle which would disburse money based on a national prize event along the lines of Google’s XPrize with industry leaders (in CSR etc) being the primary promoters (with the backing of ISRO) and bringing potential investors and stakeholders on the same table to promote innovation and entrepreneur ship in this sector.
  • Enacting space legislation within the country to define regulatory, legal and procedural regimes with transparent timelines for pursuing space activities by the private space industry is currently at a nascent stage with no national legislation governing space activities, which however remains critically necessary. Enacting stand-alone policy packages for regulating a service/product as a retrospective measure on commercial interest can only be an initial step to the leap required in development of a holistic act for active promotion and encouragement of commercial space activities. The need of the hour is the development of time-bound, transparent procedural aspects of delivering authorisations, licenses, frequency allocations, and others.
  • The government has taken significant steps in the creation of an active investor mindset by rolling out programmes such as ‘Make in India’. Space has been an identified sector in the Make in India campaign. However, there have been no significant proposals made under Make in India for manufacturing space-related systems in India. There is a need for a transparent strategy on how the potential of space sector can be leveraged under Make in India. There are significant opportunities in manufacturing (e.g. small satellites) and services (e.g. GIS) for which a framework for engagement needs to be developed.
  • There is scope to establish an independent, wholly space activities focused think tank within the country on the lines of the European Space Policy Institute constituting distinguished experts in the space field while preserving its independence in the preparation of its various research outputs, research materials and expert gatherings. Such a think tank will not only provide a fair assessment in purview of national goals; it can potentially provide key insights on space programme management, dual-use of technologies, economic impacts of space expenditures, space law, international cooperative space agreements, among other matters.
  • Active engagement of clustered activities engaging academia- industry-agency is of significant importance for creating systemic changes in establishing a globally leading research output environment. One of the excellent methods of moving away from an ‘Islands of Excellence’ model to actively promoting inter- dependent engagement of academia-industry-agency is by creating flagship programmes (where each of these stakeholders have concrete involvement in deliverables and gain significant benefits having long term ecosystem prospects of spin-offs). Such templates are already available with programmes such as Hodoyoshi by the Japanese government.
  • In order to be able to even debate and discuss commercial space in India and their viability within the government or to make specific recommendations to the government, there needs to be a foundation that facilitates such a topical discussion. It is more important that this foundation remain without any conflict of interest in order to make recommendations to the Government of India. With no particular, dedicated, independent space commerce assessment body for space-related activities or a dedicated road map within ISRO for commercial space in India, there is a need to establish an ‘Office of Space Commerce’ that is independent of ISRO. The ‘Office of Space Commerce’ may be a principal unit under the Department of Industrial Policy and Promotion under the Ministry of Commerce and Industry, Government of India. The same department is in-charge of the much talked about ‘Make in India’ campaign, which also lists Space as a priority sector. Such a template is already present in the US with the Department of Commerce creating ‘Office of Space Commercialization’, legislatively established under Section 8 of the Technology Administration Act of 1998 (Public Law 105-309, as amended) by the US Congress as a principal unit for its space commerce policy activities, with a mission to foster the conditions for the economic growth and technological advancement of the US commercial space industry.
  • Issues around national security shall always be a concern when any actor chooses to pursue space activities. However, holding back possible commercial possibilities in utilising outer space hostage under the garb of national security will only hold back the country in expanding products/services globally. This may also lead to an ecosystem of Indian space entrepreneurs creating holding companies in space commerce friendly countries and operating their product/service, eventually creating loss of high-technology jobs and tax revenues for the country. Several scenarios of commercial space activities have played out in leading spacefaring nations and there already lies a template in steps taken by their respective governments in securing national security while actively promoting space commerce. These can provide significant lessons to the DoS in formulating an active commercial space strategy for promotion of Indian space industry.


This post is based on the an occasional paper titled ‘Space 2.0: Shaping India’s Leap into the Final Frontier‘ published by Observer Research Foundation.