On June 11 this year, India’s Prime Minister Narendra Modi inaugurated the headquarters of the Indian National Space Promotion and Authorization Centre (IN-SPACe). It was a significant step in the operationalization of reforms launched by the Government of India to promote private sector participation in India’s space sector, providing access to space assets, data, and facilities, which were hitherto entirely with the government entity Indian Space Research Organization (ISRO).
IN-SPACe is an independent single-window agency, which will permit and oversee the activities of private enterprises in building and launching satellites, and providing space-based services. It will evolve suitable mechanisms for sharing ISRO’s technologies and expertise at no cost or reasonable prices to avoid reinventing the wheel. ISRO’s capital-intensive, high-technology facilities will be made available for use by private enterprises. In short, the Indian government will, through IN-SPACe, ensure a level playing field for private industry with enabling policies and a friendly regulatory environment.
India’s space industry has recorded remarkable successes over the past decades in the face of a hostile external environment (sanctions, export controls, technology denials) for much of the period of its development. ISRO has developed end-to-end technologies for space-based services and applications in various sectors. It has indigenously developed sophisticated technologies of strategic importance. It designs, builds, and launches satellites for high throughput communications, geo-imaging and high-resolution earth observation, and operates an independent Indian stand-alone navigation satellite system (NavIC). In scientific and developmental applications, the Indian space program is, in some respects, ahead of that of some of the more advanced space-faring nations.
The global space industry today generates revenues of nearly $400 billion. This figure is projected to grow to over $1 trillion by 2040 and $2.7 trillion by 2050. This growth will be driven by increasing demand for new automation technologies and miniaturization, resulting in cost, time, and quality benefits. Space technology is already widely accessible, and more sophisticated versions will further widen its reach as new generation networks and enhanced satellite navigation services upgrade connectivity with faster communication and high-resolution images. In addition to Elon Musk’s SpaceX and Jeff Bezos’ Blue Origin, a flourishing private space industry has arisen, offering a range of space services.
Despite rising demand, India’s share in the global space market is miniscule. The reason is that ISRO has had a near-monopoly over the supply of these services, and its primary focus has been developmental and scientific applications for the use of the government and its agencies.
The demand for dedicated communication (Satcom) capacity, as well as Earth Observation (EO) applications, is rising rapidly. Large corporates are willing to invest in their own satellite, thereby ensuring captive capacity for their future needs. New applications like inflight and maritime broadband connectivity and government initiatives like Digital India and Bharatnet offer new opportunities for companies in the Indian Satcom market. With the growth in EO technology, mining companies can replace their field equipment with satellite-based analytical and monitoring tools.
As of now, Satcom services’ demand in India is estimated at around $11 billion. This does not reflect true demand because of the supply-driven framework. ISRO’s in-house capacity provides communication mainly to remote geographical areas and islands, which terrestrial cables cannot access economically. Imported satcom services are considerably more costly, thereby depressing demand. When the private sector manufactures and launches satellites, the market will move to a truly demand-driven situation. IN-SPACe will oversee the rollout of policies to enable privately-owned communication satellites and ground stations, with the allotment of suitable orbital slots.
The first important step in commercializing launch vehicle production was taken with the award of a contract for manufacturing five Polar Satellite Launch Vehicles (PSLVs) to a consortium of the public sector undertaking Hindustan Aeronautics Limited and the private sector company Larsen & Toubro for $103 million.
Earth observation data for satellite imagery is also an under-provided market since regulations hitherto mandated that data requirements of customers should be sourced only through ISRO. Again, ISRO’s capacity is almost fully utilized for the requirements of the government and its agencies. To meet the demand from other users, it imports and resells data, making it more expensive. The new policy will permit privately owned and operated space-based remote sensing systems for activities within and outside India.
The demand for geospatial data in India is projected to grow to nearly $12 billion by 2029-30. The government has recently taken measures to nurture and develop the geospatial ecosystem of the country. It has lifted the requirement of license or prior approval for the collection, generation, dissemination, storage and/or digitization of geospatial data and maps. This will spur growth in downstream applications by significantly reducing the price of high-resolution data and its applications.
As the repository of space technologies, ISRO has a crucial role to play in sharing them with the Indian industry. Indian entrepreneurs could also build technology partnerships with foreign companies willing to invest in bringing satellite technology to India.
ISRO has equipped IN-SPACe with a technical lab with state-of-the-art equipment for satellite design, fabrication, integration, and testing, which will be available to Indian companies. More modern facilities and infrastructure are to be made available to the space industry.
The use of space-based technologies in warfare, intelligence, and defense has been highlighted by recent conflicts in West Asia and Ukraine. Critical defense needs include space-based defense systems for defense communications, high-resolution imagery for target detection, and other real-time information. The secrecy involved in defense applications means that these products have to be indigenously manufactured, serviced, and upgraded. There may be opportunities for reputed Indian companies in this area.
There has already been a rapid growth in space start-ups and companies upgrading manufacturing capability in the space sector. An industry body, the Indian Space Association, has been formed to promote this nascent industry’s interests and policy advocacy with the government and its agencies. This is an important role at this stage when the government, ISRO, and the private space industry seek to evolve an optimal public-private partnership.
If the reforms progress as projected, the Indian space sector should generate – in domestic sales and exports – at least USD 50 billion of revenues by 2025.
Ambassador P.S. Raghavan
P.S. Raghavan, a Distinguished Fellow of the Vivekananda International Foundation, is a former diplomat.