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Does India need to put more effort towards privatizing the Space Industry?

Does India need to put more effort towards privatizing the Space Industry?

Ever since 2004, when privatized space travel was legalized in the United States, the number of private companies playing the “Space” arena has only increased. Private firms like SpaceX, Virgin Galactic, Indian billionaire Naveen Jain promoted Moon Express and Jeff Bezos owned Blue Origin serve as robust examples for privatization in space.

Privatization of space in India

Bangalore startup team Indus wins at Google Lunar XPrize

American counterparts privatizing the space industry have spawned similar developments within India. With more private firms joining the fray, India is poised to emerge as a key center for space activity in the coming years.

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Until now, the private space companies in India were only allowed to supply components, or build engines and satellite launch vehicles for ISRO. But the recent developments in the space will allow startups to both integrate and launch satellites. Moreover, to keep up with the race globally, India must at least launch 10-12 satellites, every year. Dr. M Annadurai, Director, ISRO’s Satellite Centre explains, “The goal can be met only by a synergy between ISRO and Industry, and such a partnership will mark a win-win situation for both.”

Transition from “Traditional Space” to Privatization

The traditional business model across the space sector has transformed significantly, over the years. ISRO has been encouraging the development of India’s private space sector since the 1970s. Today, the traditional space agency-driven model has grown to include several Small-Medium-Enterprises (SMEs), that mostly cater within the traditional space model.

However, the onslaught of time has introduced several new initiatives to support space privatization, and the new startups that emerge in the landscape. The private space industry in India has been more of a tier-based vendor ecosystem. The space was devoid of firms that could provide end-to-end systems, until now, as most of the fresh players today are striving to provide end-to-end systems for both the launch vehicle and satellite segments.

The “traditional space” has witnessed India as one of the most successful nations to have developed the capacity to deliver payloads to space, or to develop satellites for services. The current outlook for space in the country looks bright, as initiatives are being undertaken to step of industry participation in launch vehicles and satellites. These will help the homegrown enterprises to expand products and services for the domestic market, as well as participate in the $300-billion global space industry.

Emergence of “New Space” in India

New Space” can be essentially described as a global phenomenon where entrepreneurs develop products, and service enterprises focus on space. The approach uses private funding to fuel initial developments, and strives to challenge the “traditional space” methods, as they are expensive, time- consuming, and unusually lack the room for inventive risk-taking.

SpaceX, OneWeb, Blue Origin, Moon Express and Planet Labs, are primarily funded by private capital and fall within the definition of “New Space” companies. They build products and services that challenge the cost to either obtain access to space itself, or to access services based out of assets in space. Within the next 10 years, more than 10,00 New Space startups are expected to kick-off around the world.

India isn’t far behind when it comes to understanding and integrating the scope of “New Space.” The ecosystem supporting “New Space” in India is a very recent development, and aims at inspiring other Indian entrepreneurs and startups to venture into business areas involving space products and services.

Successful launch of the Geosynchronous Satellite Launch Vehicle

The ecosystem for “New Space” has seen the advent of several innovative startups, which include Team Indus, Earth2Orbit, Astrome Technologies, Bellatrix Aerospace, and SatSure, and more. These startups are proposing value by introducing an array of “New Space” applications, like developing space-based internet service, developing a private launch vehicle, landing a rover on the Moon, and more.

The “New Space” approach will assist in diversifying the customer base for Indian industry in the space sector at the global level. However, the companies entering the New Space arena will require huge investments to support the essential objective of building end-to-end products and services models.

Interestingly, the business model for most of these startups is strikingly different, with the possibility of either serving private businesses, or consumer themselves. Moreover, most of these startups in the country focus on the possibility of exporting their offerings, as opposed to traditional business models.

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Why should space industry be privatized?

Extensive privatization of space would help towards forging a comprehensive ecosystem. Besides allowing the industry to support the needs of the local market, the move will also assist in taking up the turnkey development of upstream and downstream products, and services as well, for the global marketplace.

Some of the key benefits include:

  1. This will help towards boosting India’s foreign policy drives, where space will act as a major emerging tool in fostering relationships
  2. New jobs will be created in the in the high-skilled-labor market to address the needs of the private space industry
  3. The new focus on privatization of space will help in reversing brain-drain from the country
  4. This will also instrumental in creation of more opportunities that support foreign direct investments (FDI) through the ‘Make in India’, or the ‘Digital India’ campaigns
  5. This will also be directed towards avoiding circulation of tax-payer money within the ecosystem, in favour of foreign clients procuring turnkey products and services

Fuelling the development of private space industry

The Indian ecosystem must develop and incorporate mechanisms of continuous tracking and monitoring. This will help in enabling businesses from a policy framework perspective, and lay down a solid foundation. A long-term roadmap must be drawn by the policymakers, which will assist towards creating an environment of multiple industry players or industry consortiums, who reflect the ability to deliver end-to-end systems.

64th International Astronautical Congress in China

Key pointers for promoting Space privatization:

  • The Confederation of Indian Industry (CII) can recognize and award Indian companies who have made considerable progress in the space industry.
  • It’s an efficient step to initiate a space directory of companies, capabilities, and others; which can be accessible to anyone in the international markets.
  • The private industry for space must be encouraged to participate along with ISRO in the largest space conference in the world – the International Astronautical Congress (IAC).


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