Director General of the Indian Space Association, Lt Gen (retd) AK Bhatt, has said the Foreign Direct Investment (FDI) policy, which is in the final stages of being announced by the Government, would be critical for the development of the space sector.
“We believe once the FDI policy is in place, funds will flow from Indian big companies once they become profitable. There will be financial incentives for private players to be able to operate and they will be able to get finances not only from the country but from international sources too,” Bhatt said, in its outlook for 2024.
According to the Indian Space Association (ISA), India’s upcoming FDI policy for the space sector may allow 100 per cent foreign investment in satellite operations, launch vehicle manufacturing, and subsystem production.
The current FDI policy allows up to 100 per cent FDI in the area of satellite establishment and operations, but only through the Government route. The Government plans to allow up to 74 per cent overseas ownership through the automatic route and up to 100 per cent through the Government route.
The new policy aims to attract global investors in satellite communications. The need for the policy is higher as the Indian space startup ecosystem is expected to attract more investments than the $110 million it landed last year.
In a stellar display of prowess, India soared to new heights in 2023 with the successful landing of Chandrayaan-3 and the launch of Aditya-L1, India’s first solar mission. These milestones not only secured India’s standing in the global space economy but also fueled the engines for the private space sector in India.
While many important events unfolded in the Government sector, the private sector also witnessed major milestones this year. Firstly, the launch of the second batch of 36 satellites of OneWeb by ISRO/NSIL in March 2023.
OneWeb India recently became the first company to receive approval from Indian space regulator IN-SPACe for satellite broadband services. The company is soon to roll out space-based communication services in India. The company is soon to roll out space-based communication services in India.
Marking a significant milestone for India’s burgeoning satellite communication sector, the Telecommunications Bill, 2023, recently secured legislative approval with its passage through both houses of Parliament.
Indian Space Association termed the Bill a “landmark”, stating that it will pave the way for the administrative allocation of satellite spectrum in India.
“The decision by the government to allocate the satellite spectrum through a globally harmonised administrative method in the Telecommunications Bill, 2023 will pose a greater good for the nation and will spur growth in the nascent space industry, especially the downstream sector, foster healthy competition, and ensure a level playing field for all stakeholders involved,” the space association’s DG said.
Indian space startups have become a strong pillar for the private space industry in the last decade, especially after the landmark move to open the Indian space sector to private companies in 2020.
“With total funding of USD 123.90 million received in 2023, India’s space startups are not just stargazers but trailblazers in the commercial space race. This brings the total funding to USD 380.25, received by the Indian space startups to date. In the past year, a total of 54 new space startups have emerged, bringing the current count of space startups in India to 204,” Bhatt noted.
In October, the Indian National Space Promotion and Authorization Centre (IN-SPACe), the nodal agency under the Department of Space (DOS), unveiled the decadal vision and strategy for the Indian space economy.
IN-SPACe is an autonomous nodal agency formed in June 2020 to “promote, enable, authorize and supervise non-government entities” to undertake space activities.
The current size of the Indian Space Economy is estimated at around USD 8.4 billion (around 2-3 per cent of the global space economy) and it is expected that with the implementation of the Indian Space Policy 2023, USD 44 billion Indian space economy can be achieved by the year 2033.
The role of the private sector will be prime to achieve the expected economic figure. It is expected that the private sector will take up independent end-to-end solutions in satellite manufacturing, launch vehicle manufacturing, provide satellite services, and manufacture ground systems.
(with inputs from ANI)