Budget 2022: Triggering space revolution for India

Indian Space sector is evolving as a major contributor to the economy thanks to the proactive policies adopted by the government in recent years. As per the Economic Survey 2021-22, the Indian Space sector is predicted to acquire a bigger portion of the global space economy, largely driven by private sector participation with investments flowing from within and outside the country. As per the latest government estimates, more than 100 startups are engaged in the space industry, with 47 of them registering with the government in 2021 alone. The private sector and academia have submitted around 40 proposals to the interim IN-SPACe board for operations ranging from the launch vehicle and satellite manufacture to earth observation applications.

Pursuant to the Make in India initiative, the industry also witnessed the active participation of private players in several initiatives like ISRO’s recent Earth Observation Satellite project with two co-passengers on PSLV-C52. Several components for the launch were indigenously manufactured by private startups. To further engage private sector participation in the space sector, the government has undertaken the initiative of liberalising traditional Satellite Communication and Remote Sensing sectors. Also, with an aim to spur innovation and encourage competition at the global level, the government has eased access to geospatial data as well as mapping restrictions. On the disinvestment front, the government has identified Space &Defence as one of the strategic sectors for disinvestment. With increased investment and engagement with private players, the industry is preparing for the next phase of growth in India.

The government is keen to make steadfast progress in the space sector by pushing massive investments as announced in the Union Budget 2022 and with the Space related policies.

This year, the Department of Space (DoS) has been allocated Rs13,700 crores in the annual budget, Rs7465.60 crores of which is earmarked for capital expenditure, a quintessential approach for the industry that has embarked on several major missions for the upcoming months. Rs13,700 crore was allocated for the DoS to carry out ambitious projects like the Gaganyaan, the scheduled launch of Aditya L1 to the Sun and the development of a trip to Venus. Further, inclusion of space technologies like spatial planning tools with ISRO imagery developed by BiSAG-N (Bhaskaracharya National Institute for Space Applications and Geoinformatics) as part of the Pradhan MantriGati Shakti National Master Plan (NMP) highlights the commitment to increase collaboration between the government and the space sector. The allocation of funds to academic bodies such as Indian Institute of Space Science and Technology (IIST), Semi-Conductor Laboratory (SCL), North Eastern Space Applications Centre (NE-SAC), National Atmospheric Research Laboratory (NARL) and Physical Research Laboratory (PRL) will further boost research and innovation in the space sector.

Space startups in India have also achieved significant growth over the past one year and is expected to attract more investments across key verticals in the coming years. In a major drive to incentivize the startup ecosystem, the Budget has extended tax benefits to the eligible entities. In addition, the government has announced plans to establish an expert committee to address the regulatory concerns raised by private equity and venture capital investors while engaging with the startup ecosystem.

India currently holds a meager 2.6 % of the global space industry. With the government’s vision to make India a significant part of the global space economy, detailed regulation in the form of a comprehensive policy encompassing Spacecom, remote sensing, transfer of technology, Satnav, and all other space aspects will help to shape up the sector and direct a structured flow of more and more investments either from the government or through domestic/foreign investments. This will be an outlay for the next decades which can make India a global destination for space technologies all around the globe.