India boosts space investment by raising limits on foreign funding

Image credits: R. Satish Babu/AFP/Getty Images

After opening up its space sector to private companies four years ago, India has updated its official space regulations to attract global investors and companies. A new foreign direct investment (FDI) policy could raise limits on foreign investment and spark renewed interest in South Asia’s space community.

Indian public and private stakeholders are taking steps to increase the country’s participation in the space sector. India’s space agency, the Indian Space Research Organization (ISRO), has also been attracting global attention in recent months, including the successful landing of the Chandrayaan-3 spacecraft on the moon and its partnership with NASA to join the Artemis Accord. made great progress. However, restrictions on foreign direct investment have limited India’s ability to attract foreign investors and delayed funding for some of India’s growing space technology startups.

On Wednesday, Prime Minister Narendra Modi’s Cabinet approved amendments to FDI norms to allow increased foreign investment in the space sector, in some cases up to 100%. Under the revised policy, the Government of India has defined three different categories.

• Up to 49% (foreign ownership) for launch vehicles and related systems and subsystems, creation of spaceports for launching and receiving spacecraft
• Up to 74% in satellite manufacturing and operations, satellite data products, terrestrial and user segments
• Up to 100% for manufacturing components and systems and subsystems for satellites, ground segments, and user segments

Foreign investments above prescribed thresholds require government approval.

In June 2020, the Indian government passed space sector reforms and established a new agency, the National Space Promotion and Licensing Center, to enable private companies to utilize ISRO’s resources and infrastructure.

The country also introduced a space policy last year that sets out detailed guidelines and rules for private participation. New Delhi also replaced century-old rules with a new telecommunications law to enable the foundation of a global satellite-based broadband service provider, including Elon Musk’s Starlink.

India is home to around 190 space technology startups, offering solutions such as launch vehicles, space situational awareness, and hyperspectral imagery. Investments in Indian space startups reached more than $124 million last year, according to government data. The country’s space economy is projected to reach $44 billion by 2033, up from $8.4 billion last year.

The Indian Space Association, an industry body whose members include space technology start-ups and private companies, expects the latest FDI norms to increase India’s presence in the global space economy from its existing share of just over 2%. There is.